[SINGAPORE] Maybank Securities has sounded a positive note for the outlook for the Thailand technology services sector, on the back of support from the banks and government.
In a report dated Jun 6, Maybank Securities analyst Wasu Mattanapotchanart singled out tech consulting company Bluebik as the top pick for growth.
Maybank Securities estimated that the company’s FY2025 and FY2026 core profit growth to come in at 16 per cent and 25 per cent, respectively.
“Bluebik maintains its growth target of 20 to 30 per cent, thanks to more engagement with core clients, especially banks, financial services and insurance companies,” said Mattanapotchanart, noting that the consultancy’s core clients contributed to a third of Bluebik’s FY2024 revenue.
He is also confident about the consultancy being able to maintain its growth target because there has been more bidding from government projects. The revenue contribution from such projects is set to grow from under 5 per cent in FY2024 to approximately 10 per cent in FY2025, he noted.
The report also noted that Bluebik has grown in wallet share among customers seeking to save on cost, as it prices its services 20 to 30 per cent lower than those of its global competitors, such as Accenture, Deloitte and EY.
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The analyst reiterated a “buy” call on Bluebik, with a target price of 39.9 baht (S$1.57), noting that it is trading at 9.5 times the estimated FY2026 price-to-equity (P/E) ratio; this is the second-lowest among tech-service companies under Maybank Securities’ coverage.
“The target price implies the estimated FY2025 P/E of 22.5 times.”
Mattanapotchanart added that Bluebik has plans to undertake more projects in Vietnam; it also made its foray into the Indonesian market this year.
Bluebik’s chief executive officer Pochara Arayakarnkul expects the revenue contribution from foreign markets to rise from 5 per cent in FY2025 to 10 per cent or more in FY2026.
“The key risk for Bluebik is a recession in the second half of 2025, which could force its clients to delay tech investments,” warned Mattanapotchanart.
Moody’s Rating changed its outlook for Thailand’s economy from “stable” to “negative” in April.
Another stock highlighted by Maybank Securities was Netbay. It has projected FY2025 and estimated FY2026 dividend yields to come in at between 6 and 7 per cent.
Netbay, which is 24.9 per cent owned by Thailand tech-service company Ditto, boasts high potential earning upside from non-trade businesses, said the analyst.
Ditto, which specialises in data-management solutions and engineering projects for government agencies, is projected to have a net profit of 608 million baht in FY2025, assuming 3.0 billion baht revenue and 20 per cent net margin.
The 20 per cent net margin is on par with the net margin in the first quarter of 2025; the 608 million baht net profit of Ditto is a 33 per cent increase year on year.
Mattanapotchanart said: “Ditto is confident that Netbay would show earnings growth in the second half of 2025.”
“For Netbay, we forecast a core profit of 230 million baht in FY2025,” said Mattanapotchanart. This is a 7 per cent increase year on year.
Mattanapotchanart estimated Netbay’s core profit for the first half of FY2025 to be around 60 per cent of the full year forecast due to the pre-tariff export rush to the US, China and Europe.
“However, if the second half of FY2025’s net profit turns out to be on par with the first half’s estimated profit of 138 million baht, there is a 20 per cent upside to our FY2025 estimated earnings,” the analyst said.
This best-case scenario implies that FY2025 dividend yield of Netbay is estimated to be 7.1 per cent, higher than Maybank Securities’ current forecast of 6.1 per cent yield.
Maybank Securities has a “buy” call on Netbay with a target price of 25.3 baht, which is based on the estimated FY2025 P/E ratio of 22 times.
“This is 15 per cent lower than the five-year mean of one-year forward P/E ratio of 26 times.”
The last company cited by Mattanapotchanart was Samart Telcoms (Samtel), a system integrator specialising in government projects.
“Samtel targets record-high revenue of 6.5 billion baht in FY2025, on the back of project wins from the Ministry of Transport, the Provincial Electricity Authority, and state-owned banks,” said the analyst. This is a 53 per cent increase in year-on-year revenue.”
Mattanapotchanart added that Samtel now has about 8.4 billion baht in backlog, of which 3.2 billion baht is estimated to be scheduled to be realised as revenue of FY2025.
This means that 70 per cent of Samtel’s FY2025 revenue target is already secured by the backlog.
“In the year to date, Samtel has signed four billion baht in projects,” he said.
Samtel aims to sign 10 billion baht in projects in FY2025. This is an increase from 4.8 billion baht in FY2024, thanks to higher government capex in FY2025 and delays to government projects from last year, Mattanapotchanart added.
“Assuming the 6.5 billion baht revenue is achieved, and 3 per cent net margin, we forecast 195 million baht year on year FY2025 net profit for Samtel,” he said. This means that the year-on-year net profit will increase by 69 per cent.
“Samtel’s strong outlook is largely priced in, in our view, as evidenced in its FY2025 estimated P/E ratio of 18 times.”
Mattanapotchanart noted that Samtel aims to win a 20 billion baht concession project in the fourth quarter of 2025.
Samtel expects the government to announce the project details in July. The auction is expected to occur in August or September, and will be signed in December.
If the project timeline is uninterrupted, the revenue stream from this project is expected to start in FY2027, said the analyst.
