Kiatnakin Phatra Bank (KKP TB)

Kiatnakin Phatra Bank is Maybank Securities’ top pick in the banking sector, with a “BUY” recommendation and a target price of THB65, reflecting a 20% upside. The bank is poised to deliver the highest return on equity (ROE) improvement within the sector, increasing from 8.1% in FY24 to 9.7% in FY26. This growth is driven by higher net interest margins (NIM), fee income growth, and reduced credit costs.

Key highlights include a strategic focus on high-ROE businesses such as wealth management fees, while reducing low-ROE lending activities in the low-yield segment. The bank also plans to sustain its dividend payout ratio (DPR) at 60-65% for FY25-26, supported by a loan contraction that enables room for share buybacks. Historical DPR ranged from 70% to 92% during slower loan growth periods.

Loans are expected to remain flat in FY25, with loan spreads potentially increasing by 10 basis points due to lower funding costs. Non-performing loans (NPLs) are forecasted to stabilize at 4.1-4.3%. Credit costs are projected to decline to 2.0% in FY25 from 2.3% in FY24, aided by reduced losses on car sales as car inventory drops to 3,200 units in 2024 from 4,600 in 2023. The bank is also executing a share repurchase program worth THB950 million, having already bought 16.2 million shares by January 2025.

FY24 net profit declined by 8% YoY due to lower NIM, but 4Q24 results exceeded expectations, with net profit jumping 110% YoY, driven by strong fee income and mark-to-market investment gains. Operating expenses fell 10% YoY, reflecting improved efficiency. The bank’s target for FY25 is to achieve fee income growth of 7%, primarily from wealth management and capital markets. Its long-term ROE target is 9.7%, supported by a solid capital management plan.

Bangkok Bank (BBL TB)

Bangkok Bank has been assigned a “BUY” rating with a target price of THB175, offering a 12% upside. The bank demonstrates robust financial metrics, with a P/E ratio of 6.8x for FY24 and 6.6x for FY25. It maintains a P/B ratio of 0.5x for both years and delivers an ROE of around 8%. The dividend yield is projected at 4.8% for FY24 and 5.1% for FY25.

Thai Credit Bank (CREDIT TB)

Thai Credit Bank is rated “BUY” with a target price of THB29, indicating a significant upside potential of 46%. The bank stands out with an ROE of 15.2% for FY24 and 14.6% for FY25. It trades at a P/E of 7.8x for FY24 and 7.0x for FY25, with a P/B ratio of 1.1x and 1.0x, respectively. The dividend yield is relatively low at 1.2% for FY24 and 1.4% for FY25.

Kasikornbank (KBANK TB)

Kasikornbank is another “BUY” recommendation with a target price of THB177, offering an 11% upside. It trades at a P/E of 8.1x for FY24 and 7.5x for FY25, with a P/B ratio of 0.7x and 0.6x, respectively. The bank’s ROE is forecasted at 8.6% for FY24 and 8.7% for FY25, with a dividend yield of 5.0% for FY24 and 6.0% for FY25.

Krung Thai Bank (KTB TB)

Krung Thai Bank has a “BUY” rating and a target price of THB25, reflecting a 9% upside. The bank exhibits attractive valuations with a P/E of 7.7x for FY24 and 7.3x for FY25. It trades at a P/B ratio of 0.7x for both years, accompanied by an ROE of 10.0% in FY24 and 9.9% in FY25. The dividend yield is estimated at 4.9% for FY24 and 5.4% for FY25.

TMBThanachart Bank (TTB TB)

TMBThanachart Bank is rated “BUY” with a target price of THB2.10, offering an 11% upside. The bank trades at a P/E of 8.6x for FY24 and 8.1x for FY25, with a P/B ratio of 0.8x and 0.7x, respectively. ROE is projected to improve from 9.0% in FY24 to 9.4% in FY25. The dividend yield is estimated at 7.0% for FY24 and 8.0% for FY25.

SCB X (SCB TB)

SCB X holds a “HOLD” recommendation with a target price of THB118, reflecting a downside of 5%. The bank trades at a P/E of 9.0x for FY24 and 9.1x for FY25, with a P/B ratio of 0.8x for both years. It delivers an ROE of 9.1% in FY24 and 9.4% in FY25. Despite limited upside, SCB X offers a high dividend yield of 8.9% for FY24 and 8.8% for FY25.

TISCO Financial Group (TISCO TB)

TISCO Financial Group is rated “HOLD” with a target price of THB105, offering a modest upside of 6%. It trades at a P/E of 11.4x for FY24 and 11.2x for FY25, with a P/B ratio of 1.8x for both years. The bank’s ROE remains impressive at 16.1% for FY24 and 16.2% for FY25, supported by a dividend yield of 7.9% for FY24 and 7.8% for FY25.