Energy: Renewable Energy
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Energy: Renewable Energy
- Benzene tax cut, diesel tax raised
The NCPO has approved a benzene price cut through reduction of oil fund
levy and excise tax and a diesel price raise through an increase of excise tax.
This will affect the government sector, while the refinery sector and PTT group
will continue selling oil based on global price.
The NCPO has approved the oil price restructuring, as part of the formerly
announced energy reform policy. According to the new structure, benzene
prices will be cut by B1-3.89/liter from reduction of oil fund levy and
excise tax. On the other hand, diesel price will go up by B0.14/liter from
an increase of excise tax, but will not exceed the existing ceiling of
B30/liter. However, the Energy Policy and Planning Office (EPPO) still has
no conclusion about LPG and NGV prices.
- No impact on refinery and PTT group
The above-mentioned oil price restructuring method is in line with our
previous projection. Since the restructuring is made through tax and levy
cut, ex-refinery oil price is still based on global price, thus no effect is
seen on refinery entrepreneurs i.e. TOP, PTTGC, IRPC, BCP, ESSO, PTT,
and oil retailers, but the government revenue will decrease instead.
- Good entry point in PTT group
We maintain OVERWEIGHT for the sector. The decrease in prices of shares
in PTT groups possibly resulted from lack of understanding in the oil price
restructuring, which is considered as a good entry point. We recommend
BUY for PTT (FV@B360), PTTEP (FV@B195), PTTGC (FV@B84),
IRPC([email protected]), and BCP (FV@B36), while HOLD is recommended for
TOP(FV@B560)
