Thailand Energy Crisis: Analyzing PTT, Bangchak & PTG Stocks

Rising tensions in the Middle East are emerging as a potential catalyst for a “new energy crisis,” as global oil prices initiate to climb amid supply concerns. Simultaneously, Thailand is facing compounding pressure from domestic energy policies, particularly the phased increase of diesel fuel price ceilings to a maximum of 33 baht per liter.

This confluence of factors is refocusing investor attention on Thailand’s major oil companies: PTT Oil and Retail Business Public Company Limited (OR), Bangchak Corporation Public Company Limited (BCP), and PTG Energy Public Company Limited (PTG). The performance of these companies is closely tied to crude oil prices, marketing margins, and their non-oil businesses.

PTT Oil and Retail Business (OR) reported total sales and service revenue of 658.723 billion baht in 2023, a decrease of 65.235 billion baht, or 9.0%, from 2022, due to declining global oil prices and reduced sales volume. Despite this, OR maintained strong cost management and operational efficiency, resulting in an EBITDA of 20.357 billion baht, an increase of 2.691 billion baht, or 15.2% year-over-year. This growth was driven by the Mobility business group, particularly aviation and diesel fuel, and improved performance in the Lifestyle business group, notably Café Amazon, which continues to be popular with consumers. OR reported a net profit of 11.304 billion baht in 2023, up from 7.65 billion baht the previous year, a 47.8% increase, translating to earnings per share of 0.94 baht.

In the fourth quarter of 2023, OR’s sales and service revenue reached 155.535 billion baht, a 1.3% increase from the previous quarter, driven by seasonal factors. The Mobility business group saw revenue growth due to increased sales volume of aviation and diesel fuel, whereas the Lifestyle business group benefited from both retail food and beverage and other retail businesses. However, the Global business group experienced a decline in revenue due to slower sales in some countries. OR’s Q4 EBITDA was 4.443 billion baht, with a net profit of 2.078 billion baht, lower than the previous quarter due to increased operating expenses.

OR’s portfolio includes 2,413 PTT gas stations serving 3.9 million customers daily, along with 355 international stations. The company also operates 111 FIT Auto service centers, 1,349 EV Station PluZ charging stations with 2,931 chargers, 4,742 Café Amazon branches (selling 429 million cups annually), 294 international Café Amazon locations (selling 24 million cups), 487 Thai Dett shops, 2,403 7-Eleven and Jiffy convenience stores, 12 found & found health stores, and boasts 9.3 million PTT Blue Card members. OR has also invested in brands such as Pacamara Coffee Roasters, Oh Kajoo, Kamu Tea, Dusit Food, Drink Enterprise, Otteri, and Central Plaza Hotels.

Bangchak Corporation (BCP) reported a net profit attributable to the company of 2.880 billion baht in 2023, a 32% increase from the 2.184 billion baht recorded in 2022, with earnings per share of 2.08 baht. Total revenue from sales and services amounted to 507.570 billion baht, and EBITDA reached 35.753 billion baht. The company’s normalized net profit (excluding special items) was 10.240 billion baht, a 67% increase from 2022, with synergy benefits of 7.3 billion baht realized throughout the year from integration efforts and efficient production management.

BCP has prioritized growth in its oil trading and exploration and production businesses for 2024, aiming to strengthen its regional competitiveness and support energy security. The company’s refining, marketing, and bioenergy businesses remain strong, poised to capitalize on favorable market conditions. BCP plans to begin commercial operations of its Sustainable Aviation Fuel (SAF) business in June 2024, marking a significant step in its transition towards low-carbon energy.

BCP operates 2,163 Bangchak gas stations, 365 electric vehicle charging stations with 1,096 charging points, 1,028 Inthanin coffee shops, 2,050 FURiO lubricant distribution points, and over 170 Bangchak Car Care centers. The company’s BCP Green Miles loyalty program is also a key component of its customer engagement strategy. BCP has also invested in brands like Jones Salad and Gateaux House, and operates lifestyle businesses including Code Clean logistics and automated vending machines.

PTG Energy (PTG) reported a net profit of 1.074 billion baht for 2023, a 3.1% increase year-over-year, with an EBITDA of 6.899 billion baht, up 11.3% YoY. Gross profit increased by 18.4% YoY to 17.489 billion baht, driven by strong growth in its non-oil business, which saw a 75.7% increase in gross profit. This resulted in non-oil businesses contributing 37.1% of total gross profit, up from 25.0% in 2022.

PTG’s total revenue from sales and services was 224.341 billion baht, a slight decrease of 0.7% YoY, due to lower average retail prices in the oil business. However, oil sales volume remained stable across all channels, reflecting the strength of its customer base. The non-oil business experienced significant growth, with revenue increasing 31.7% YoY to 23.654 billion baht, driven by the strong performance of its Pan Thai Coffee business, which expanded to 2,151 branches, an increase of 59.7% YoY, or over 2.2 branches per day, and continued growth in same-store sales.

PTG operates 1,347 PT gas stations, 190 electric vehicle charging stations, 2,151 Pan Thai Coffee shops, 24 Coffee World locations, 58 Subway restaurants, 345 Max Mart stores, 3 Kaew Ruam Mit noodle shops, 76 Autobacs locations, and 380 Max Mart convenience stores. The company’s PT Max Card and PT Max Card Plus loyalty programs have 25 million members.