Gunkul Engineering Public Company Limited, or GUNKUL, reported second-quarter 2569 core profit of 564 million baht, up 31.7% from the previous quarter and 17.8% from a year earlier, beating analyst expectations by 13%. Foreign exchange gains and derivative losses combined to a positive 10 million baht, bringing net profit to 575 million baht. Total revenue was 2.79 billion baht, up 9.9% from the previous quarter and 54.8% from a year earlier, roughly in line with expectations. Growth was driven by the EPC business, which rose 4.4% from the previous quarter and 188.0% from a year earlier, supported by power plant construction, government projects, and accelerated solar roof installations under government support measures. The electrical equipment distribution business grew 29.1% from the previous quarter and 22.0% from a year earlier, helped by government system investment. Private PPA revenue declined because of a high base from a major customer in the second quarter of 2568. Gross margin was 33.4%, above the expected 31.9%, as the electrical equipment distribution gross margin rose to 24.5% from 15.9% in the first quarter of 2569, and the private PPA business contributed a larger share of recurring revenue. Share of profit from associates was 132 million baht, down 12.3% from the previous quarter but up 4.5% from a year earlier, as more variable weather and monsoons increased wind strength compared with a year ago. The previous quarter also had one project whose adder expired, reducing the share of profit. Yuanta Securities expects the third-quarter 2569 trend to be similar to the second quarter at 500 to 600 million baht, with EPC and electrical equipment distribution remaining high from the previous quarter and growing strongly from a year earlier. Backlog currently stands at 4.3 to 4.5 billion baht, stable from the end of the first quarter of 2569, even after substantial revenue recognition in the second quarter. There are also projects under bidding with a chance of winning worth around 6 billion baht, plus or minus, during the third and fourth quarters of 2569. Share of profit from associates is expected to recover from the previous quarter because it is the high season. Current capacity attributable to the company is 2,121 megawatts, with more than 200 megawatts awaiting PPA signing, expected to be signed within the third quarter of 2569. Investment in the Philippines is expected to add at least another 200 megawatts, which is not yet included in estimates. In 2569 to 2570, new power plants awaiting commercial operation date total 88 megawatts and 801 megawatts respectively. The current market price trades at 2569 to 2570 price-to-earnings ratios of only 22 times and 18 times respectively, below the sector average, and GUNKUL benefits across all segments of the electricity and clean energy business. First-half 2569 core profit was 993 million baht, up 19.6% from a year earlier, representing 48% of Yuanta Securities' full-year core profit estimate. The firm maintains its estimates, keeps its end-2570 target price at 8.70 baht, and reiterates its buy recommendation.
Gunkul Engineering Public Company LimitedQ2 core profit beat forecasts by 13%, up 31.7% QoQ and 17.8% YoY, with higher margins.
