BEM’s Revenue Unlikely to Take a Hit Despite MRT Blue Line Fare Reduction

The Royal Gazette has announced new fare regulations for Bangkok’s MRT Blue Line, setting ticket prices between Bt17 and Bt44, effective from July 3, 2026. Despite this slight reduction from the previous structure, Krungsri Securities maintains a positive outlook on Bangkok Expressway and Metro Public Company Limited (SET: BEM), expecting limited impact on the company’s profitability through July 2028. According to Krungsri Securities, while the revised fares appear to reflect a Bt1 decrease (about 2%)—mainly occurring after the sixth station—most segments remain unaffected, and not every station past the sixth sees a price reduction. The firm also anticipates that any lowered fares could drive higher passenger traffic, likely mitigating the effect on revenues. Krungsri Securities has not altered its revenue assumptions, projecting flat growth for toll road operations and a 3% increase in rail revenue, resulting in an overall revenue growth estimate of 0.2% for FY26F. The expected earnings growth for FY26F remains at 3.4% year-on-year. Sensitivity analysis indicates that a 1% decline in rail revenue would cut FY26F earnings by only 0.9%. With BEM’s share price still below pre-pandemic levels despite improved earnings prospects and asset base—including the Blue Line extension and the Orange Line—Krungsri Securities reiterates its ‘BUY’ rating and a target price of Bt8.20. The brokerage believes the current valuation does not fully reflect the value of these recent expansions.