Bangchak Corporation: All units saw recovery in 3Q25F
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- Expect 3Q25F net profit at THB1.84bn (+188% y/y, +172% q/q), lifted by business recovery across all units and less inventory loss impact
- Market GRM and marketing margin estimated at USD7.5/bbl (+201% y/y, 69% q/q) and THB0.85/litre (+10% y/y, +16% q/q)
- SAF project to start in 2Q26F, supported by a 1% SAF usage mandate in Jan 2025 and improving margins
- Maintain BUY with an FY26F TP of THB41
Business recovery across all units to lift up 3Q25F. We expect BCP to report a 3Q25F net profit at THB1.84bn (+188% y/y, +172% q/q), Financial performance improvement is supported by i) expectations of a lesser inventory loss of THB1.2bn (vs. 3Q24’s loss of THB5.12bn and 2Q25’s loss of THB3.4bn), and ii) a q/q improvement in business performances of refinery, marketing, power, and upstream.
Market gross refining margin (GRM) and net marketing margin this quarter are estimated at USD7.5/bbl (+201% y/y, +69% q/q), and THB0.85/litre (+10% y/y, +16% q/q). Overall EBITDA is projected at THB9.38bn (+109% y/y, +184% q/q).
3Q25F key operating metrics
- Refining utilisation rate is expected at 90% (vs. 88% in 3Q24 and 82% in 2Q25). In 3Q25, JET/GO/ULG/HSFO crack spreads stood at USD16.1/18.7/10.3/-3.9 per barrel (+13%/+18%/-10%/n.a. q/q). The stronger spreads were lifted by a) tight global supply, b) increasing demand for motor oil during the driving season, and c) geopolitical conflict between Russia and Ukraine. Hence, market GRM is estimated at USD7.5/bbl (+201% y/y, +69% q/q).
- Regarding inventory impact, we expect BCP to book a net inventory loss of THB1.2bn (vs. 3Q24’s gain of THB5.12bn and 2Q25’s loss of THB3.47bn), USD-1.52/bbl, despite average Dubai price increasing by c.USD3.0/bbl.
- Marketing business performance is expected to improve both y/y and q/q. Total sales volume is projected at 3,400mn litres (+2% y/y, flat q/q). The flattish sales volume q/q was a result of a) 3% q/q decline in retail sales volume, and b) a 5% q/q increase in commercial sales volume of asphalt, fuel oil, and jet. Net marketing margin (MKM) is projected at THB0.85/litre (+10% y/y, +16% q/q).
- The renewable business’s core performance is expected to improve both y/y and q/q. Stronger electricity sales volume came from a) hydro power in Laos during the rainy season; b) stronger sales volume in Laos, Thailand, and Vietnam; and c) higher equity income from a higher capacity revenue US’s cogeneration power plan (from USD29/MW-day to USD270MW-day. Hence, EBITDA is projected at THB1.1bn (-8% y/y, +12% q/q).
- Upstream business performance deteriorated y/y but improved q/q. Total sales volume is projected at 34kboed (-17% y/y, +3% q/q). We estimate average selling prices and EBITDA in at USD64.7boe (-14% y/y, +3% q/q), and THB3.50bn (-43% y/y, +11% q/q).
- Extraordinary items in 3Q25F included a forex gain of THB150mn.
Outlook
Healthy refinery margins, supported by seasonal demand and supply concern. Given the seasonal demand for travelling during year-end and tight supply due to the increasing tension between Russia and Ukraine, refinery margins stood at healthy level where middle distillate margins averaged above USD22/bbl, the highest level since late 2023.
On a 4Q25TD basis, JET/GO/ULG crack spreads stood at USD21.5/22.9/14.3 per barrel (+34%/+23%/+38% q/q).
SAF project to kick-off in 2Q26. In Aug 2025, TTCL is filing a lawsuit of c.THB3.4bn in damages against BCP of the breaches of the EPC construction contract of SAF project. However, BCP's management insists that they have fully complied with the lump-sum EPC contract. This legal dispute could potentially delay the start-up of the SAF project, though BCP's management is making efforts to ensure that the commercial launch is not affected by the lawsuit.
In Oct 2025, the conciliation between TTCL and BCP came to an end; neither agreed to patch up with each other. Thus, the issue is currently in court and the timeline for a verdict remains unknown. In our view, this lawsuit could be a drag on both business performance and share price, even though BCP is not yet required to set aside a provision of around THB3.4bn as the case has just begun.
On the other hand, BCP has secured the new EPC for the construction of the remaining work of the SAF project as BCP is confident that SAF will start commercialisation in 2Q26F without further delay. Moreover, we deem the following two supporting factors could motivate the startup of the SAF project: a) The mandate for airlines operating in Thailand to use 1% SAF usage in Jet A1 fuel beginning in Jan 2026, according to Thailand’s draft Alternative Energy Development Plan (AEDP) 2024, targeting 8% by end of 2030; and b) improving SAF margins where 4Q25TD stood above USD2.0/litre.
Maintain BUY. We maintain BUY for BCP with an FY26F TP of THB41, pegged to a FY26F P/BV of 0.8x, equivalent to its five-year average. Our positive view is supported by i) BCP being one of the nation’s healthiest domestic refineries with a solid margin of safety; ii) its lack of exposure to the chemical industry, where outlook remains bearish; iii) its five-year average P/BV of 0.7x, still below local peers’ average of 0.8x; and iv) its relatively lower exposure to regulatory risks from domestic energy price cuts compared to domestic.
Note that we revised down our FY25F net profit project by 51% from THB8.19bn to THB4.02bn as we factored in expected 9M25F net inventory loss of THB4.96bn.
FY Dec | 3Q2024 | 2Q2025 | 3Q2025F | % chg y/y | % chg q/q |
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Revenue | 154,193 | 125,826 | 132,393 | (14.1) | 5.2 |
Cost of Goods Sold | (150,891) | (123,084) | (123,704) | (18.0) | 0.5 |
Gross Profit | 3,302 | 2,742 | 8,689 | 163.1 | 216.8 |
Other Oper. (Exp)/Inc | (3,391) | (3,999) | (3,853) | 13.6 | (3.6) |
Operating Profit | (89.0) | (1,257) | 4,836 | (5,531.3) | (484.9) |
Other Non Opg (Exp)/Inc | 3,092 | 1,342 | (200) | nm | (114.9) |
Associates & JV Inc | 474 | 301 | 600 | 26.7 | 99.1 |
Net Interest (Exp)/Inc | (1,740) | (1,858) | (1,850) | (6.3) | 0.4 |
Exceptional Gain/(Loss) | 4,111 | (1,527) | 150 | (96.4) | (109.8) |
Pre-tax Profit | 5,847 | (2,999) | 3,536 | (39.5) | nm |
Tax | (7,535) | (416) | (1,254) | (83.4) | 201.4 |
Minority Interest | (406) | 854 | (440) | (8.4) | (151.5) |
Net Profit | (2,093) | (2,561) | 1,842 | nm | (171.9) |
Net profit bef Except. | (6,204) | (1,034) | 1,692 | nm | (263.7) |
EBITDA | 8,056 | 4,946 | 9,787 | 21.5 | 97.9 |
Margins (%) |
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Gross Margins | 2.1 | 2.2 | 6.6 |
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Opg Profit Margins | (0.1) | (1.0) | 3.7 |
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Net Profit Margins | (1.4) | (2.0) | 1.4 |
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Source: Company, DBSVTH
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