Analysts recommend a "Buy" on North East Rubber Public Company Limited (NER), with a highest target price of 6.50 baht per share, citing expectations of a strong recovery in second-half performance driven by higher rubber prices amid tight supply. NER is one of Thailand's block rubber producers expected to benefit from the EUDR measures in Europe once enforced. The company has already received EUDR rubber orders of about 2,000 tonnes and has about 10,000 tonnes ready for delivery. It targets EUDR rubber sales of about 40,000 tonnes per year, or no more than 10% of total sales volume. Current block rubber selling prices have risen to 77-80 baht per kilogram, following SICOM rubber prices hitting their highest level in over a decade. In Q3/2026, sales volume increased to about 120,000 tonnes, and GPM has a chance to stay above 10%, bringing normal profit closer to the previous peak of 619 million baht. For Q4/2026, if El Niño intensifies, sales volume may drop to about 110,000 tonnes, but it will still be supported by higher selling prices and GPM. Normal profit for the second half is expected at 1.0-1.1 billion baht, pushing full-year profit to potentially reach 1.8 billion baht, about 4% higher than estimates. Currently, NER trades at a low PER for 2026 of only 5.0 times, compared to TEGH and STA at 6.0 times and 12.7 times, respectively, offering a dividend yield of 7% per year. With a positive business outlook, the PER used in valuation is raised from 6 times to 7 times, increasing the end-2026 target price to 6.50 baht, with an upside gain of 40.1%. The "Buy" recommendation is maintained. Meanwhile, KGI Securities (Thailand) states the consensus target for NER is 5.40 baht, assessing that rubber prices have risen sharply to test a 9-year high due to El Niño. Consensus expects a dividend this year of 0.35 baht (dividend yield 7.6%). In the first half of 2026, 0.05 baht per share has already been paid, leaving 0.30 baht per share (yield 6.5%).
North East Rubbers Public Company LimitedAnalysts maintain Buy and raise NER's target price to 6.50 baht on expected profit recovery to 1.8 billion baht.
