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Published on April 1, 2008

BECL closed yesterday at Bt20.30, up from Bt20.20 last Friday.

After the opening of the ring road, BECL reported expressway traffic was down 3.88 per cent year on year in February, to 971,000 cars a day. Meanwhile, the average traffic on the ring road is 140,000-150,000 cars a day.

However, the decrease in expressway traffic has been lowered to 30,000 fewer cars a day now, from 50,000 fewer cars a day previously.

Kiatnakin Securities believes expressway traffic will return to normal once the ring road starts collecting tolls early next year.

Research by United Securities shows the opening of the South Outer Ring Road has affected BECL's toll revenue, especially at the Dao Khanong, Suksawasdi, Bang Na and Bangchak pay points. The brokerage house expects traffic on BECL's Expressway to shrink 2 per cent year on year.

Phillip Securities expects BECL to record traffic of 938,000 cars a day this year, down 0.16 per cent year on year. Based on increased tolls from last September, BECL's revenue is expected to reach Bt7.68 billion this year for a net profit of Bt1.78 billion. The brokerage house has placed a "buy" recommendation on BECL shares, similar to Kiatnakin Securities, because it feels BECL's performance is on an uptrend this year.

Research by Phillip Securities shows BECL now has lower financial costs, because it has continuously paid down its debts. In addition, a downtrend in domestic interest rates will reduce BECL's Bt17 billion worth of debt, which relies on floating interest rates.

Meanwhile, the proposed tollway should be finished in September. The research shows BECL should be allowed to increase its toll at least Bt5. BECL plans to issue Bt7.5 billion worth of debentures and is waiting for the right time, in line with a downtrend in US interest rates.

Kiatnakin Securities expects BECL's net profit to be Bt1.68 billion this year, with earnings per share of Bt2.18, up 19 per cent year on year.

The broker is optimistic about BECL's 2008 dividend payment, which is attractive at Bt1.20 per share, or 5.88 per cent of dividend yield.

BECL's consolidated 2007 revenue was Bt7.29 billion, up from Bt7.01 billion the year before. The company posted a consolidated net profit of Bt1.4 billion for last year, down from Bt1.53 billion in 2006.

The Nation