Summary · why it matters
Bualuang Securities stated in an analysis dated September 15, 2026, that the issuance of exchangeable bonds referencing shares of Delta Electronics (Thailand) or DELTA by a company in the Delta Electronics group is likely to create share supply pressure, or overhang, on the stock price in the short term, rather than affecting fundamental earnings, since no new shares are being issued and therefore there is no dilution effect. Delta Electronics Taiwan is preparing to issue exchangeable bonds with a total value of 1.5 billion US dollars through Delta Electronics International Singapore, a wholly owned subsidiary that holds a 42.85% stake in DELTA. The bonds are zero-coupon exchangeable bonds, divided into two tranches: a 500 million US dollar tranche maturing in September 2027 and a 1 billion US dollar tranche maturing in September 2031. Bloomberg indicated yields of 2-4% for the 2027 tranche and 0.5-1.5% for the 2031 tranche, while TradingView, citing Reuters data, indicated negative yields in the ranges of 2-4% and 0.5-1.5% respectively, so final yield terms still await confirmation. Regarding put options, the 2027 tranche has no put option, while the 2031 tranche provides put rights in March 2028 and September 2029. Bualuang estimates that using a DELTA share price of 252 baht as the reference price and assuming a 10% discount to the share sale price, the sale price would be approximately 227 baht per share. Including the exchange premium, the exchange price of the 2027 tranche is expected to be approximately 261-272 baht per share and the 2031 tranche approximately 295-318 baht per share. The number of shares potentially available for exchange is estimated at approximately 160-170 million shares, or 1.3-1.4% of total shares, before including the greenshoe over-allotment option, while the previous transaction involved approximately 0.4% of shares. Bualuang views the overhang from this transaction as clearer than the deal in January 2025 because it is larger, the 2027 tranche has a short maturity, and the premium to the market price is lower, resulting in the share price being likely to fluctuate and be capped in the short term. However, the fact that Delta Electronics International Singapore, which holds a 42.85% stake in DELTA, is the issuer of these bonds, differs from the previous transaction conducted through DIH Netherlands, which held a 13.77% stake, and this may make the market more cautious about the possibility that the Delta group will use its holdings to create value through similar transactions in the future. Although the transaction creates short-term pressure, Bualuang maintains a positive view on DELTA's AI and data center business outlook and keeps its buy recommendation, but lowers the target price to 330 baht to reflect the overhang and reduces the valuation premium to a standard level.
Delta Electronics (Thailand) Public Company Limited
Delta Electronics Inc