Share price of COM7, a Thailand-based IT products retailer, surged 7.80 per cent on Wednesday to a new high of 58.75 baht by the end of morning trading, with a transaction value of 1.47 billion baht, based on the promising IT demand uptrend.
The IT retailer has been boosted by the work-from-home demand during the Covid-19 pandemic that started in March last year. At the end of 2020, share price had risen to 39 baht.
KTBST Securities said it expects COM7 to “exceed the 10 per cent growth target this year” on the back of an increase of branches, a reduction of Covid-19 restrictions, improving online sales, and efficient cost management.
The company group had 911 branches as of the end of 2020 under the retail brands BaNANA, Studio7, and KingKong Phone. Of those, 124 were new branches opened last year amid the outbreak. COM7 aims to increase the number of stores to reach 1,000 this year.
COM7 posted net profit for 2020 at 1.49 billion baht, up 22.6 per cent. The KTBST analyst raised the net profit forecast of COM7 to 1.79 billion baht, up 24 per cent year-on-year, for 2021 and 2.17 billion baht, up 21 per cent year-on-year, for 2022.
The revision was based on expectation of stronger revenue from both on-and offline channels and reduced expenses given a cut in employees per store and lower rents, particularly from standalone stores, the analyst said. The average number of employees reduced to 4.3 per store in 2020 from 5.2 in 2019.
“We reiterate a buy rating on COM7 but raise our target price to 60.00 baht from 48.00 baht following our 2021 earnings forecast upgrade”
Meanwhile, another IT products distributor Synnex Thailand (SYNEX) also rose 13.66 per cent to 20.80 baht per share mid-day, accounting for 648 million baht of transaction value, after the company said it was expecting earnings growth of 10 -15 per cent this year. Synnex’s 2020 net profit was 642 million baht, up 22.53 per cent.