Summary · why it matters
Kasikorn Securities assesses that the planned issuance of $1.5 billion in exchangeable bonds by shareholders of Delta Electronics (Thailand) Public Company Limited, or DELTA, will have a limited impact on fundamentals, as no new shares will be issued and therefore earnings per share, or EPS, will not be diluted by an increase in share count. The issuer is also subject to a 90-day lock-up on share sales, which should help limit short-term selling pressure. The research team therefore expects no significant immediate impact on DELTA's share price beyond negative sentiment. After the previous announcement of an exchangeable bond issuance in January 2025, DELTA's share price fell 5-6%, so the impact this time is expected to be smaller. However, the exchange price may still weigh on the share price and limit upside for DELTA shares in the short to medium term. Delta Electronics Int'l (Singapore) Pte. Ltd., a shareholder of DELTA and a subsidiary of Delta Electronics Inc., plans to issue zero-coupon exchangeable bonds overseas worth $1.5 billion on September 21, 2026, to fund working capital and support future business expansion. The issuance is split into two tranches. Tranche A has a principal amount of $500 million and matures on September 21, 2027, with a one-year term. Tranche B has a principal amount of $1.0 billion and matures on September 21, 2031, with a five-year term. The exchange price reflects a reference price of 232 baht. The initial exchange price for Tranche A is 266.8 baht per share, a 15% premium to the reference price of 232.0 baht per share, while the exchange price for Tranche B is 301.6 baht per share, a 30% premium. If conversion rights are fully exercised, this would amount to approximately 62.1 million shares for Tranche A and 109.9 million shares for Tranche B, for a total of 172.1 million shares, or about 1.38% of DELTA's issued and paid-up shares. DELTA's shares last closed at 252 baht on September 14, 2026, meaning Tranche A's exchange price is about 6% above the latest market price, while Tranche B's exchange price is 20% above the latest market price. The value of this issuance is far larger than the exchangeable bond issued in 2025. In January 2025, Delta International Holding Limited B.V. issued a zero-coupon five-year exchangeable bond worth $525 million, maturing on January 21, 2030, with an initial exchange price of 187.6 baht per share, a 40% premium to the reference price of 134 baht. If conversion rights were fully exercised, this would amount to 97.4 million DELTA shares, or about 0.78% of issued and paid-up shares. The 2026 issuance's potential underlying shares represent 1.38% of DELTA shares, compared with 0.78% previously. The research team maintains a "Buy" rating on DELTA with a mid-2027 target price of 300 baht, based on a target PER of 92 times, which is 1.5 standard deviations above the historical average.
Delta Electronics (Thailand) Public Company Limited
Delta Electronics Inc