Following the Logistics & Transportation conference organized by DBS Vickers Securities (DBSVS) on June 29, 2021, Thoresen Thai Agencies Public Company Limited (TTA) is projected to recover in 2Q21, bolstered by its core business, “the bulk cargo,” and the global orderbook for container vessels falling to a 30-year low. Additionally, TTA’s earnings are projected to be boosted by its offshore business, as TTA is one of the few companies that can survive a downturn.
The management team of TTA stated that the company’s positive outlook will continue due to rising TC Rates, such as the Supramax index, which has hit US$30,000/day/ship and is likely to retain this level. Demand for bulk carriers is expected to increase by 4% this year, while supply of new fleets is expected to fall to 3%.
The company’s latest orderbook totals $241 million, with 31% of revenue coming from a high-margin “cable laying” business.
As a result, DBSVS has given a “BUY” rating on TTA with a target price of 22.20 baht, based on a 2022 forward P/BV of 2.15x, which is being supported by rising global oil prices.