Goldman Sachs on Aeon Financial Service (8570.T): Thai Subsidiary Q2 - Guidance Points to Continued Cautious Lending; Credit Loss Provision Ratio Edges Higher
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Goldman Sachs Japan reviews fiscal Q2 FY2/27 results (three months) at Aeon Financial Service's Thai subsidiary Aeon Thana Sinsap, released 7 October; the group reports 9 October. Aeon TS posted revenue of THB 5.15bn, down 5.8% year on year, prioritizing asset quality over new lending as Thai personal consumption slows (2Q +1.9% YoY) under cost-of-living and household leverage pressures. Credit card income fell 13.3% YoY, personal loans 6.9% and installments 1.3%, with the company still temporarily suspending new used-car installment loans while shifting toward motorcycle financing. Higher credit costs (+8.0% YoY) were largely offset by financial expenses (-12.7% YoY, reflecting prior-year policy rate cuts) and administrative expenses (-6.2%), leaving net profit at THB 642mn, down 18.8% YoY. Operating assets contracted across the board QoQ - credit cards -1.2%, personal loans -0.6%, installments -2.7% (their first decline after six quarters of growth). The ECL ratio reached an annualized 9.8% of operating assets (6.2% net of recoveries), provisions rose to 9.8% of assets, and the NPL ratio hit 5.9% (+0.3pt QoQ, +0.7pt YoY) on installment and Cambodia loan adjustments. For 3Q, Aeon TS guides to continued cautious lending amid Middle East-related uncertainty. Goldman's first impression: the softness was foreseeable given slowing domestic demand. The visible text lists no current rating; price history shows a ¥1,080 target from 8 January 2026.
Key exhibits
Exhibit 1
