Company Coverage
KCE (Thailand) (KCE TB): 2Q26 Expected To Be The Weakest Quarter Before Earnings Improve In 2H26, But Upside Remains Limited
HOLD (Downgraded)
Current price:
Target price:
Upside:
Previous TP :
Bt41.75
Bt40.00
-4.19%
36.00
Analyst
Highlights
- We expect KCE to report a 2Q26 net profit of Bt212m (+16% yoy, -10% qoq), marking its weakest quarter this due to continued cost headwinds.
- 2H26 earnings could improve, as KCE could raise PCB prices by 10-12% for most customers in 3Q26.
- Downgrade to HOLD with the higher target price of Bt40.00, as we believe the share price has largely priced in the 2H26 earnings recovery. We view Bt45.00-50.00 per share as a stretched valuation range in 2H26.
Analysis
- Raw material cost pressure is expected to make 2Q26 the weakest quarter of 2026. We expect KCE (Thailand) (KCE) to report a 2Q26 net profit of Bt212m (+16% yoy, -10% qoq), marking the lowest quarterly earnings of the year before improving in 2H26. Sales are forecast to rise qoq to Bt3.31b (+0.6% yoy, +6.4% qoq), supported by a 5% depreciation of the Thai baht qoq and a full quarter resumption of gold-plated PCB production. However, earnings are projected to remain soft as continued raw material cost pressure is likely to keep gross margin broadly flat at 18.2% in 2Q26 (vs 17.7% in 1Q26), primarily due to a 16% increase in the average copper price to US$12,878/tonne in 1Q26, given the three-month lag.
Highlights
- We expect KCE to report a 2Q26 net profit of Bt212m (+16% yoy, -10% qoq), marking its weakest quarter this due to continued cost headwinds.
- 2H26 earnings could improve, as KCE could raise PCB prices by 10-12% for most customers in 3Q26.
- Downgrade to HOLD with the higher target price of Bt40.00, as we believe the share price has largely priced in the 2H26 earnings recovery. We view Bt45.00-50.00 per share as a stretched valuation range in 2H26.
Analysis
- Raw material cost pressure is expected to make 2Q26 the weakest quarter of 2026. We expect KCE (Thailand) (KCE) to report a 2Q26 net profit of Bt212m (+16% yoy, -10% qoq), marking the lowest quarterly earnings of the year before improving in 2H26. Sales are forecast to rise qoq to Bt3.31b (+0.6% yoy, +6.4% qoq), supported by a 5% depreciation of the Thai baht qoq and a full quarter resumption of gold-plated PCB production. However, earnings are projected to remain soft as continued raw material cost pressure is likely to keep gross margin broadly flat at 18.2% in 2Q26 (vs 17.7% in 1Q26), primarily due to a 16% increase in the average copper price to US$12,878/tonne in 1Q26, given the three-month lag.
HOLD (Downgraded)
Current price:
Target price:
Upside:
Previous TP :
Bt41.75
Bt40.00
-4.19%
36.00
Analyst
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