Thailand’s second largest bank with dividend yield of 5%
KBank is Thailand’s second largest bank based on total loans and ranks first in SME products and mobile banking. In FY23, Kbank achieved growth of 13% and 18% in revenue and net profit, and has increased dividend distributions over the past three years. Here are the key takeaways from Beansprout evaluations on Kbank.
1. Loan growth targeted for 3-5% in 2024
Loan portion fell 1.1% QoQ in 1Q24. Kbank expects loan growth to pick up in 2H24driven by stronger economic momentum (i.e., boosted by the resumption of government investment budget disbursement and tourism rebounding towards the pre-pandemic level).
2. Net Interest Margins (NIM) expanded in 1Q24
Kbank’s 2023 NIM rose to 3.66% from 3.33% in 2022, driven by rising rates,expects to maintain NIM in 2024. 1Q24 NIM was higher at 3.76%.
1. Loan growth targeted for 3-5% in 2024
Loan portion fell 1.1% QoQ in 1Q24. Kbank expects loan growth to pick up in 2H24driven by stronger economic momentum (i.e., boosted by the resumption of government investment budget disbursement and tourism rebounding towards the pre-pandemic level).
2. Net Interest Margins (NIM) expanded in 1Q24
Kbank’s 2023 NIM rose to 3.66% from 3.33% in 2022, driven by rising rates,expects to maintain NIM in 2024. 1Q24 NIM was higher at 3.76%.
3. Fee based income up 10% in 1Q24
One of KBank’s core strategies is to scale up on fee income businesses, leveraging its key strengths are in two areas including Wealth and Payment. Kbank dominates the digital payment with K PLUS App being number one in mobile banking platform.
4. Trades at deep discount with dividend yield of 5%
Based on its share price of Bt128.5/share, KBank is trading at deep discount to its Book Value with a price-to-book valuation of 0.57x. KBank has also increased its dividend payout ratio from the low of 20% in 2020 to 37% in 2023, significantly above its minimum payout policy of 25%.
One of KBank’s core strategies is to scale up on fee income businesses, leveraging its key strengths are in two areas including Wealth and Payment. Kbank dominates the digital payment with K PLUS App being number one in mobile banking platform.
4. Trades at deep discount with dividend yield of 5%
Based on its share price of Bt128.5/share, KBank is trading at deep discount to its Book Value with a price-to-book valuation of 0.57x. KBank has also increased its dividend payout ratio from the low of 20% in 2020 to 37% in 2023, significantly above its minimum payout policy of 25%.
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