KGI Research Singapore

Singapore's leading broker offering Futures, FX, Equities and Wealth Management.

Banyan Tree Holdings Ltd (BTH SP/B58.SI)

Company Update: 30 March 2023

On track to recovery

  • On the road to recovery. Banyan Tree Holdings Ltd (BTH) returned to profitability by year-end with a 23% increase in revenue and a 30% increase in hotel RevPAR. In FY22, the group also achieved record-high property sales with S$217.2mn properties sold.
  • New beginnings. It opened 8 new hotels and has 679 new keys in 5 countries and now has a portfolio of 63 properties with a total of 8,731 keys. In FY23, it opened 2 properties in China and 9 more openings in the timeline.
  • Maintain OUTPERFORM with a higher TP of S$0.43, as we anticipate a stronger FY2023 as the global economy reopens, and BTH is well-positioned to capitalize on growth opportunities. The company’s expertise in rebranding hotels and providing quality services aligns with the increasing demand for travel and hospitality services. Therefore, we maintain our OUTPERFORM rating with an unchanged TP.

1HFY2023 update

BTH has become more streamlined following the sale of their property in Australia during 1H22. In FY2022, it reported a net profit of S$8 million, a significant improvement from the net loss of S$163 million in FY2021. This was largely due to the strong recovery in travel demand, with revenue increasing by 82% YoY to S$228 million. BTH’s notable improved performance in Thailand and Malaysia contributed to the positive results. This performance represents a 62% recovery from pre-pandemic levels in FY2019. The group will be proposing a final dividend of 1.0 cent per share, subject to shareholders’ approval, reflecting its confidence in the ongoing recovery of the tourism industry.

New concepts

The Group has launched new, innovative brands, designed to cater to the evolving needs of their guests. By expanding beyond luxury offerings and creating diverse hotel concepts in multiple regions, they have set themselves apart from competitors and widened their appeal to a broader audience. This move enables the Group to capture new market segments and capitalize on emerging trends in the hospitality industry.

BTH occupancy close to pre-pandemic levelsNew openings.

The hotel segment of the group has experienced a significant increase in occupancy, with levels approaching those seen before the pandemic. Most of the guests are international travellers indicating a strong rebound in the hospitality industry.

Valuation & Action

We maintain an OUTPERFORM recommendation with a higher TP of S$0.43 based on 5-year average of 1.26x P/S. BTH has proven to have a resilient and adaptable business model that can weather the challenges brought by the pandemic. The group has a sizeable cash balance of S$92.8mn (33% of its current market capitalisation, S$281.6mn), supported by its strong free cash flows of S$113.15mn. BTH proposed a 1.0 Sing cents final dividend for FY2022.


High inflationary pressures and rising economic uncertainty.

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