Kasikorn Bank's 2Q13 profit predicted to jump to THB10.5-11b

Flat NIM is also expected.

According to Maybank Kim Eng, although nothing there has been no fundamental changes, the 19% share price drop in the past month on foreign sell off has made KBANK more attractive as a long-term investment. 

In 1Q13, loan growth was unimpressive due to seasonality with some debt repayment from the business segment.

However, loans accelerated in May, expanding 1.3% MoM (+3.5%YTD), driven by all segments, corporate, SME and retail.

Here's more from Maybank Kim Eng:

We expect stronger growth momentum in 2H13 on seasonality and increased exports due to expected global economic recovery. 

We roughly forecast the 2Q13F net profit at THB10.5-11.0b, up both QoQ and YoY. Loan and fee income should continue to grow, with an expected flat NIM. NPLs will remain low, with declining credit costs from the extra 1Q13 provisioning.

Solid earnings growth with a flat ROE. KBANK set a loan growth target of 9%-11% and Non-NII growth target in the mid teens for this year and identified fee income and insurance premiums as drivers.

It expects the NIM to remain steady at 3.4%-3.6%, with projected cost-to-income ratio maintained at 45%-46%. Credit costs are expected to rise to 70-80bps vs
65bps in 2012. It also set aside additional provisioning as a conservative buffer against future economic uncertainty.

Our assumptions are inline with the bank’s targets and we forecast 16% net profit growth for this year. However, we do not expect further ROE expansion for KBANK in
2013F despite its outstanding ROE expansion last year.