Kasikornbank

Kasikornbank Plc (KBANK) 
 

KBANK’s Q1 2012 core net profit surpassed our and market expectations by 18% due to surging fee income and lower operating expenses. The bank appears to be finally reaping the benefits of investments in its banking platform, underpinning a more profitable future. With increases in our FY12-14 net profit forecasts, we raise our target price, now pegged to 2.4x P/BV (from 2.2x previously). This target P/BV is derived from GGM with long-term assumptions of 16.5% ROE (from 16% previously), 11.7% COE and 8.2% growth. Maintain Outperform.