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Shares of PTT Pcl were down 0.63 percent at 314 baht on expectations of lower fourth-quarter earnings due to seasonal low gas sales and lower profits from affiliates, after Thailand's top energy firm reported an impressive third-quarter earnings on Wednesday.
PTT reported its biggest rise in quarterly net profit in more than a year, boosted by robust gas sales, higher income from its upstream unit, and rising profits from its refinery and petrochemical businesses.
State-controlled PTT posted July-September net profit of 36.1 billion baht ($1.2 billion), up 68 percent from a revised 21.47 billion a year earlier, and higher than the average 34.6 billion baht forecast by 11 analysts polled by Reuters.
Several brokers rated the stock a 'buy', while CIMB Securities maintained its 'outperform' rating with a target price of 391 baht, saying subsidy losses in natural gas (NGV) and liquefied petroleum gas (LPG) may pose downside risks to earnings growth.
"Stronger-than-expected third-quarter results came from higher earnings from subsidiaries which offset weaker core gas earnings due to larger subsidies for NGV and LPG. Future growth remains solid, though it could be tempered by growing subsidies," CIMB said in a note.
"We believe price caps are unlikely to improve until 2015 when the government may need to liberalise energy prices to prevent cross-subsidies in other ASEAN countries."
CIMB cut PTT's 2012-2014 earnings estimate by 3.4 percent to 8.1 percent to reflect rising subsidy losses, saying it preferred subsidiaries PTT Exploration and Production and PTT Global Chemical for "their limited downside from subsidies and more attractive growth potential".
Shares of PTT Global Chemical were down 1.67 percent at 59 baht, while PTT Exploration and Production was 0.92 percent lower at 161 baht.
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(Reporting by Sinsiri Tiwutanond in Bangkok; Editing by Subhranshu Sahu; firstname.lastname@example.org)
$1 = 30.7 Baht