Last Update 11 Dec 25
Fair value Increased 0.45%ADVANC: Sports Content Expansion And Leadership Transition Will Support Stable Outlook
Analysts have nudged their price target on Advanced Info Service slightly higher to approximately 343.37 from 341.84 Thai baht, reflecting marginally stronger profit margin assumptions and a modestly higher future earnings multiple.
What's in the News
- AIS entered a strategic partnership with the PGA TOUR, securing exclusive rights to broadcast all PGA TOUR tournaments in Thailand via AIS PLAY and becoming the sole official telecommunications sponsor in the country (Key Developments).
- The deal includes major events such as the FedExCup Playoffs and the Presidents Cup, which will be offered at what AIS describes as accessible pricing, with plans for joint marketing to grow the local golf fan base (Key Developments).
- AIS plans to use the PGA TOUR partnership to strengthen its position as a leading sports and entertainment platform in Thailand. This supports its “All Sports in One Platform” strategy across football, tennis, basketball, American football, and golf (Key Developments).
- The Board approved the promotion of Deputy Chief Executive Officer and Chief Operating Officer Pratthana Leelapanang to Chief Executive Officer, effective 3 November 2025, succeeding retiring CEO Somchai Lertsutiwong, who will remain on the Board (Key Developments).
Valuation Changes
- Fair Value: Risen slightly from THB 341.84 to THB 343.37, reflecting a modest uplift in the intrinsic value estimate.
- Discount Rate: Unchanged at 7.44 percent, indicating no revision to the perceived risk profile or cost of capital.
- Revenue Growth: Effectively unchanged at about 3.02 percent, suggesting stable expectations for top line expansion.
- Net Profit Margin: Risen slightly from approximately 21.90 percent to 21.91 percent, pointing to marginally stronger profitability assumptions.
- Future P/E: Risen slightly from about 23.55x to 23.65x, implying a modestly higher valuation multiple on future earnings.
Key Takeaways
- AIS's focus on AI-driven data consumption and IT integration is expected to boost revenue through increased ARPU and enhanced operational efficiency.
- Strong financial health, improved sales margins, and exceeding synergy goals with Triple T Broadband support earnings growth and profitability.
- Limited operating leverage, spectrum costs, and changing market dynamics, such as broadband demand shifts, could constrain earnings and pressure revenue growth.
Catalysts
About Advanced Info Service- Operates as a telecommunications and technology company primarily in Thailand.
- AIS anticipates growing data consumption driven by AI technology, which is expected to increase data usage by 15% year-on-year over the next 3 to 5 years. This trend could positively impact future revenue through increased ARPU from higher data demand.
- The company plans significant IT integration by 2025, aiming for a unified operation by 2026, which could enhance operational efficiency, potentially improving net margins.
- AIS has lowered its leverage ratio from 2.9x to 2.2x, reflecting strong financial health and potentially increasing its capacity for strategic investments, which could support earnings growth.
- The company has improved its sales margin by optimizing handset subsidies, enhancing profitability and potentially leading to increased net margins.
- AIS's integration with Triple T Broadband has exceeded synergy expectations, suggesting potential cost savings and revenue growth opportunities, positively impacting EBITDA.
Advanced Info Service Future Earnings and Revenue Growth
Assumptions
How have these above catalysts been quantified?- Analysts are assuming Advanced Info Service's revenue will grow by 2.8% annually over the next 3 years.
- Analysts assume that profit margins will increase from 17.9% today to 21.2% in 3 years time.
- Analysts expect earnings to reach THB 51.1 billion (and earnings per share of THB 16.37) by about September 2028, up from THB 39.6 billion today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting THB58.3 billion in earnings, and the most bearish expecting THB43.9 billion.
- In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 23.9x on those 2028 earnings, up from 22.4x today. This future PE is greater than the current PE for the TH Wireless Telecom industry at 22.4x.
- Analysts expect the number of shares outstanding to remain consistent over the next 3 years.
- To value all of this in today's terms, we will use a discount rate of 7.42%, as per the Simply Wall St company report.
Advanced Info Service Future Earnings Per Share Growth
Risks
What could happen that would invalidate this narrative?- The company's EBITDA growth guidance is closely aligned with its core revenue growth guidance, potentially suggesting limited operating leverage despite being in an infrastructure-heavy industry, which may impact future earnings growth.
- There is an expected slowdown in data consumption growth, partly due to market rationalization efforts, which could impact future revenue growth from mobile services.
- Concerns about spectrum auction outcomes and potential spectrum acquisition costs could lead to increased capital expenditures, impacting net margins and possibly depressing earnings if cost savings are not realized as anticipated.
- The integration and synergy benefits from the 3BB acquisition may already be factored into current financial performance, suggesting limited additional improvements to margins and earnings in subsequent years.
- With changes in market dynamics, such as the shifting demand for broadband versus mobile, there's a potential risk of ARPU pressure if new market segments and innovative products do not drive anticipated revenue growth in broadband services.
Valuation
How have all the factors above been brought together to estimate a fair value?- The analysts have a consensus price target of THB331.211 for Advanced Info Service based on their expectations of its future earnings growth, profit margins and other risk factors.
- In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be THB240.6 billion, earnings will come to THB51.1 billion, and it would be trading on a PE ratio of 23.9x, assuming you use a discount rate of 7.4%.
- Given the current share price of THB298.0, the analyst price target of THB331.21 is 10.0% higher.
- We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.
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AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.