RELATIVE VALUATION OF HOME PRODUCT CENTER PUBLIC COMPANY LIMITED

Abstract

The objective of relative valuation report is to find the target price of Home Product Center Public Company Limited. The company is in Thailand-based company engaged in retail home improvement business under the name of HMPRO that is listed in the commerce sector on the stock exchange of Thailand (SET50). The relative valuation of HMPRO is based on two parts which are the relation to itself and peers' valuation. For the relation to itself is determined from 5 years of historical data on 6 multiples consists of 1) Trailing P/E, 2) Forward P/E, 3) Trailing P/BV, 4) Forward P/BV, 5) Trailing EV/EBITDA, and 6) Forward EV/EBITDA For peer valuation, we estimate HMPRO's target price by taking the average of all multiple bands of target price. So, the target price of HMPRO in 2023 is 15.71 THB/share and in 2022 is 13.87 THB/share, both of which are lower than the current price (16.20) THB and represent a 14 percent approximately decrease from the stock price as of April 6, 2022. Based on the relative valuation, the current stock price is overvalued, and our recommendation is to "SELL" at the current price.