Company Coverage
Central Plaza Hotel (CENTEL TB): A Brilliant Earnings Outlook For 2H26
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
Bt41.00
Bt50.00
+22.0%
Bt45.00
Analyst
Analyst
Nonpawit Vathanadachakul
Highlights
We attended CENTEL’s analyst meeting to review its 2Q26 results and the tone was very positive.
Cost of debt continues to decline from refinancing, which is a strong catalyst for CENTEL’s earnings.
Earnings outlook remains brilliant as hotel bookings are strong and the performance of food business is robust. CENTEL remains our top pick in the hotel sector, Maintain BUY with a target price of Bt50.00 (previously Bt45.00)
Analysis
Strong positive tone during analyst meeting. We attended Central Plaza Hotel’s (CENTEL) analyst meeting to review its 2Q26 results and the tone was very positive.
Strong forward bookings from 3Q26 onwards. Bangkok will host Gastech, a major global event, in Sep 26, attracting around 50,000 participants from 150 countries. We expect hotels to benefit from strong event-driven demand, with some visitors potentially extending their stays beyond the event. Based on current bookings, Bangkok hotels are expected to deliver robust mid single-digit yoy RevPar growth in 3Q26. Upcountry hotels should also benefit from short-haul substitution as Chinese arrivals continue to recover strongly, with the Thailand portfolio expected to achieve high-teens RevPar growth. Meanwhile, Maldives RevPar growth should remain strong at high-teens yoy, while improving occupancy of Centara Dubai should support a return to net profit breakeven. If we exclude Dubai and a new hotel in Japan, the overall portfolio RevPar in 3Q26 is expected to show a robust mid-teens growth yoy.
Robust food performance in Jul 26 despite pressure. Thais Help Thais Plus (60/40 copayment scheme), the 2026 domestic consumption stimulus scheme, is a key pressure point for the food business from Jun to Sep 26. This campaign diverts consumer demand away from large businesses as only small businesses are eligible. CENTEL’s food business performance in Jun 26 was decent, with same-store sales growth (SSSG) remaining flat, a clear improvement from the previous similar campaign, when SSSG contracted sharply. The performance in Jul 26 is even more encouraging, with a 3% SSSG. This was mainly due to active promotions and launch of new products, which was successful in attracting customers. CENTEL will maintain this strategy for the rest of 2H26.
Lower interest expense from refinancing. Interest expense in 2Q26 dropped 4.0% qoq and 12.4% yoy despite a higher amount of outstanding loan due to the lower cost of debt from refinancing. For 6M26, CENTEL’s cost of debt was 2.9% down significantly from the average cost of 3.4% in 2025. By the end of Sep 26, CENTEL aims to refinance another Bt2.5b loan, which will result in cost of debt being reduced from around 3.0% to around 2.0%. This will provide additional interest savings of around Bt16m per year. Management insists that there will be no prepayment fees incurred from the refinancing. We see this declining cost of debt as a positive catalyst for CENTEL’s earnings going forward.
Targets to maintain margins in 2H26 for both businesses. CENTEL’s overall EBITDA margin in 2H25 is considered high at 29.6%. Management targets to maintain this high EBITDA margin in 2H26 despite several headwinds. The biggest headwind is rising costs in CENTEL’s food business caused by the war. According to management, some plastic costs have softened and CENTEL has placed some orders which will reduce the impact of the rising plastic costs. CENTEL is also closely monitoring the margins of food brands that are conducting promotions. Once the margins are affected by the promotions, CENTEL will switch to a different promotional bundle.
Highlights
We attended CENTEL’s analyst meeting to review its 2Q26 results and the tone was very positive.
Cost of debt continues to decline from refinancing, which is a strong catalyst for CENTEL’s earnings.
Earnings outlook remains brilliant as hotel bookings are strong and the performance of food business is robust. CENTEL remains our top pick in the hotel sector, Maintain BUY with a target price of Bt50.00 (previously Bt45.00)
Analysis
Strong positive tone during analyst meeting. We attended Central Plaza Hotel’s (CENTEL) analyst meeting to review its 2Q26 results and the tone was very positive.
Strong forward bookings from 3Q26 onwards. Bangkok will host Gastech, a major global event, in Sep 26, attracting around 50,000 participants from 150 countries. We expect hotels to benefit from strong event-driven demand, with some visitors potentially extending their stays beyond the event. Based on current bookings, Bangkok hotels are expected to deliver robust mid single-digit yoy RevPar growth in 3Q26. Upcountry hotels should also benefit from short-haul substitution as Chinese arrivals continue to recover strongly, with the Thailand portfolio expected to achieve high-teens RevPar growth. Meanwhile, Maldives RevPar growth should remain strong at high-teens yoy, while improving occupancy of Centara Dubai should support a return to net profit breakeven. If we exclude Dubai and a new hotel in Japan, the overall portfolio RevPar in 3Q26 is expected to show a robust mid-teens growth yoy.
Robust food performance in Jul 26 despite pressure. Thais Help Thais Plus (60/40 copayment scheme), the 2026 domestic consumption stimulus scheme, is a key pressure point for the food business from Jun to Sep 26. This campaign diverts consumer demand away from large businesses as only small businesses are eligible. CENTEL’s food business performance in Jun 26 was decent, with same-store sales growth (SSSG) remaining flat, a clear improvement from the previous similar campaign, when SSSG contracted sharply. The performance in Jul 26 is even more encouraging, with a 3% SSSG. This was mainly due to active promotions and launch of new products, which was successful in attracting customers. CENTEL will maintain this strategy for the rest of 2H26.
Lower interest expense from refinancing. Interest expense in 2Q26 dropped 4.0% qoq and 12.4% yoy despite a higher amount of outstanding loan due to the lower cost of debt from refinancing. For 6M26, CENTEL’s cost of debt was 2.9% down significantly from the average cost of 3.4% in 2025. By the end of Sep 26, CENTEL aims to refinance another Bt2.5b loan, which will result in cost of debt being reduced from around 3.0% to around 2.0%. This will provide additional interest savings of around Bt16m per year. Management insists that there will be no prepayment fees incurred from the refinancing. We see this declining cost of debt as a positive catalyst for CENTEL’s earnings going forward.
Targets to maintain margins in 2H26 for both businesses. CENTEL’s overall EBITDA margin in 2H25 is considered high at 29.6%. Management targets to maintain this high EBITDA margin in 2H26 despite several headwinds. The biggest headwind is rising costs in CENTEL’s food business caused by the war. According to management, some plastic costs have softened and CENTEL has placed some orders which will reduce the impact of the rising plastic costs. CENTEL is also closely monitoring the margins of food brands that are conducting promotions. Once the margins are affected by the promotions, CENTEL will switch to a different promotional bundle.
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
Bt41.00
Bt50.00
+22.0%
Bt45.00
Analyst
Analyst
Nonpawit Vathanadachakul
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