Leasing

Top picks 1H58

Leasing

- 4Q14: high season for retail leasers

2H14 earnings of 14 leasing companies under our study are projected to

continue growing from 1H14, thanks to a spending season in 4Q14.

Although the leasing business has not been fully recovered as expected, it

has improved from 1H14 where the political unrest took place. 3Q14

earnings of 13 leasing companies (AEONTS’s earnings result has not been

reported yet) was B1.02bn, growing 14.0%qoq and 4.3%yoy. Earnings of

GL, SINGER, GCAP, and KCAR declined as a result of a low season.

Meanwhile, net profit of TK grew most outstandingly, followed by LIT, AUCT,

SAWAD, JMT, MTLS, THANI, IFS, and ASK; earnings of some companies

have rebounded from the bottom despite a low season.

- SAWAD, MTLS, LIT, GCAP, AUCT to have strong profit in 4Q14

SAWAD, MTLS, LIT, GCAP, and AUCT are projected to grow most

outstandingly in 4Q14 (peak spending season). SAWAD's profit is estimated

to continue growing and make a new quarterly high in 4Q14, accounting for

28% of FY2014 earnings forecast, thanks to aggressive branch expansion.

MTLS's 4Q14 earnings are expected to make a new high and make up 31%

of FY2014 earnings forecast. Focusing on factoring loans and government

leasing, LIT’s profit has rebounded since 2Q14, projected to continue

growing in 4Q14 and make up 31% of FY2014 earnings forecast. AUCT's

profit is projected to peak in 4Q14 and account for 30% of FY2014 earnings

forecast. Similarly, GCAP's 4Q14 earnings are expected to revive and make

up 27% of FY2014 earnings forecast due to a high season.

- 2H14 top picks: AEONTS, SINGER, KCAR

Top picks in 2015 are ASK([email protected]), LIT([email protected]), and

AEONTS(FV@B138) for potential strong growth, not very high share prices,

high upside, and high dividend yield in 2015.