Strong Q3 Forecast for Thai Hotels Despite Seasonal Dip
KGI Securities (Thailand) has maintained its ‘Overweight’ rating on the Thai hotel sector, projecting that key Thai hotels operators, specifically Central Plaza Hotel (CENTEL), The Erawan Group (ERW), and S Hotels and Resorts (SHR), will achieve stronger normalized profits for the third quarter of 2025.
This positive forecast comes despite the period traditionally being regarded as a softer quarter for tourism activity across the region.
For CENTEL, KGI anticipates a normalized profit of THB 141 million in the third quarter of 2025.
While this figure represents a 13.7% decrease compared to the previous year, it marks a significant 34.8% improvement from the results posted in the immediately preceding quarter, signaling a strong sequential recovery.
The overall revenue per available room (RevPAR) for Thai hotels operated by the group is forecast to grow by 4% from the previous year.
This growth is primarily driven by an expected 12% year-on-year RevPAR growth in Thailand itself and an 8% year-on-year growth in its Japanese properties, demonstrating regional strength.
In contrast, CENTEL’s properties located in the Maldives are expected to experience a RevPAR decline of 27% year-on-year, though this is still an improvement over the sharp 46% year-on-year contraction reported in the previous quarter.
Looking forward, CENTEL’s earnings for the fourth quarter of 2025 are strongly anticipated to increase even further, driven by the arrival of the crucial high tourism season and the continued positive impact of government stimulus measures, positioning the company for sustained financial momentum.
Profit Recovery and High Season Expectations for Key Operators
The outlook remains positive for ERW and SHR, with both companies benefiting from strategic positioning and the approaching peak season for the Thai hotels market.
ERW’s normalized profit for the third quarter of 2025 is expected to reach THB 86 million, which is a decline of 30.8% year-on-year, but a healthy 39% increase quarter-on-quarter.
The company’s diverse portfolio of economy-to-luxury hotels is forecast to see a 10% year-on-year decline in RevPAR, yet the sequential figures should improve by 4% quarter-on-quarter, accompanied by a high occupancy rate of 76%.
The popular Hop Inn brand is a standout performer, projected to see a RevPAR rise of 14% year-on-year, supported by a 12% year-on-year expansion in its room count, totaling 7,700 rooms.
Similar to its peers in the Thai hotels sector, ERW’s earnings in the fourth quarter of 2025 are predicted to increase substantially, fueled by the high tourism season and ongoing government support.
KGI estimates ERW’s normalized profits at THB 765 million for the full year 2025 and an THB 871 million for 2026, maintaining an ‘Outperform’ rating.
For SHR, the normalized profit in the third quarter of 2025 is impressively projected at THB 144 million, representing a significant swing from a THB 20 million loss recorded in the third quarter of 2024, and a strong increase from THB 11 million in the second quarter of 2025.
This marks four consecutive quarters of profit turnaround for SHR, showcasing operational improvements.
Renovations and Strategic Market Performance Bolstering Confidence
The strategic investment in renovations and focused performance in key markets are key factors underpinning the optimistic outlook for these Thai hotels operators.
For SHR, RevPAR is forecast to increase by 11% year-on-year in US dollar terms for its Maldives hotels, which translates to a 2% increase when measured in Baht.
More significantly for its core market, SHR’s Thai hotels are expected to see a strong 31% year-on-year uplift in RevPAR.
This remarkable increase is largely attributed to the successful completion of the renovation of the SAii Laguna Phuket property, which now commands higher rates and occupancy.
Conversely, the RevPAR for SHR’s UK hotels is expected to remain largely flat, a condition primarily due to the ongoing appreciation of the Baht against the Pound, which impacts the translation of foreign earnings.
This demonstrates the varied impact of currency fluctuations across international portfolios.
CENTEL is also well-positioned for future growth following renovations that were completed during 2025, ensuring its properties are competitive and appealing as the tourism recovery continues.
Overall, KGI Securities maintains a clear optimism towards the entire Thai hotel sector.
This positive stance is justified by multiple compelling factors, including the observed positive trends in RevPAR, a robust earnings outlook driven by the year-end high season, and the sustained, favorable benefits derived from various government tourism incentives designed to boost domestic and international visitor numbers, promising a successful period ahead for the industry.
