ASL Securities says OSP posted second-quarter 2026 net profit of 1.1 billion baht, down 5% quarter-on-quarter but up 8.9% year-on-year. Gross margin continued to expand to a record high of 42.8%, up from 41.9% in the second quarter of 2025 and 42.5% in the previous quarter, thanks to lower unit costs and a premiumization strategy, especially support from sales of new products such as C-vitt, 150-Sparkling, 150-milliliter Lipo, and Babi Mild brand products. Selling and administrative expenses as a percentage of sales fell to 22.5%, compared with 24.4% in the second quarter of 2025, due to production centralization, but rose from 21.9% in the previous quarter because of higher transport costs following global oil prices. Total revenue was 6.1 billion baht, down 3.6% quarter-on-quarter and 10.2% year-on-year, affected by lower overseas revenue, especially the inability to ship products to Myanmar for about 45 days. First-half 2026 net profit was 2.2 billion baht, down 0.8% year-on-year, accounting for 59% of the full-year 2026 estimate. The research team raised its 2026 profit forecast by 7% to 3.8 billion baht, up 4.7% year-on-year, to reflect first-half results and management guidance. It expects third-quarter 2026 earnings to contract seasonally during the rainy season in ASEAN, with a recovery in the fourth quarter. Key growth drivers are a higher gross margin reaching 41%, compared with 40% in 2025, and selling and administrative expenses as a percentage of sales falling to 23.5%, compared with 25.2% in 2025. Pressure comes from total revenue shrinking to 25 billion baht, down 1.1% year-on-year. Although management has obtained an import license in Myanmar, overseas revenue is still contracting due to weaker purchasing power and transport problems, especially in the Middle East. The broker recommends buy with a 2027 target price of 20.00 baht, based on a price-to-earnings ratio of 14.8 times, which is close to the five-year historical average of 29.3 times. The current price-to-earnings ratio is 14.5 times, an attractive level. OSP stands out for its profitability, especially gross margin and return on equity that are higher than peers. It also announced an interim dividend of 0.45 baht per share, with the ex-dividend date on 27 August 2026 and payment on 10 September 2026, representing a dividend yield of 2.6%, with an expected 2026 dividend yield of 4.8%.
Osotspa Public Company LimitedBroker raises profit forecast and recommends buy on record-high gross margin and cost control.
