Company Report

We reiterate our OUTPERFORM rating on the shares of VPB with 1Y target price of VND 70,700/share. Even though FeCredit is going through a hard time with aggressive writing off and low profitability in 2021, gradual recover should be expected in 2022. Besides, we do see better than expected income generating capacity at  the parent bank in 2022, fueled by the upcoming capital infusion. Net profit from the FeCredit divestiture and proceeds of the planned private placement support the bank’s ambitious long-term expansion. On a consolidated basis, PBT for 2021 and 2022 are projected at VND 16.8 tn (+29% YoY) and VND 21.4 tn (+27% YoY). 

FY21 NPAT growth is forecast at 23% YoY. According to management, CTR expects higher growth of 30% YoY under base case. Our forecast is a bit more conservative, given the potential impact from Covid-19. Key CTR growth drivers are from ‘defensive’ segments such as telecom infrastructure operations, telecom infrastructure leasing segment, and telecom construction which likely will be less sensitive to Covid-19, and are a good defensive play. CTR also offers more attractive EPS growth in FY21/FY22/FY23 of 22%/15%/25%, respectively, comparing favorably to Asian peers of 20%/10%/8% over the same timeframe. With 1Y target price of VND 88,900 - representing 6% upside, we call for Market Perform rating on the shares of CTR. 

At the current price of VND 49,000/share, VEA is trading at a 2021 P/E forward of 10.8x and 2022 P/E forward of 10.0x. From our last call in Feb, VEA share price has risen 10% and reached our target price. Therefore, combined with a lower-than-expected dividend payout for 2021 – 2022, possible prolonged pandemic impact up to 2022, and a further delay on the HNX listing plan, we decided to rerate VEA from MARKET PERFORM to UNDERPERFORM. We keep our earnings estimate for VEA similar to previous report at VND 6.02 tn (+9% YoY) in FY21 and 6.52 tn (+9% YoY) in FY22, thus result in 1-yr target price for the stock of VND 42,000/share using both P/E and DCF valuation method (equal to total return of -3% from capital loss of -13% & expected dividend yield of 10%). 

The Bank has been delivering strong earnings results over the past several years, backed by robust credit growth, improved NIM, and lower CIR, thanks to digitalization. The 2021 business plan is ambitious but feasible, reinforced by 1Q 2021 business results and the prolonged low-rate environment which lowers overall funding costs. However, a capital raise (equivalent to 9.3% of the Bank’s pre-money charter capital) could register a minor dilutive impact. We raise our PBT forecast +6% for TPB 2021F to VND 5.8 tn (+32% YoY). 2022F PBT is forecast at VND 7.1 tn (+21.9% YoY). We roll forward our valuation to June 2022, and raise our 1Y target price for TPB to VND 37,600/share, which implies 17.7% upside. We reiterate our Outperform rating on the shares of TPB. 

The 2021 AGM held on Apr 27 approved the annual plan, featuring 20% PBT growth and a 38% increase in charter capital. The Bank also released its 1Q 2021 earnings, which exceeded consensus with total operating income (TOI) of VND 9.1 tn (+45% YoY) and pretax profit of VND 4.6 tn (+109% YoY and 79% QoQ). Solid performance was fueled by all income streams, and reasonably controlled asset quality. The customer base continued to expand by 1 mn (+17% YTD) during 1Q 2021. We forecast MBB to achieve VND 13.6 tn in pretax profit (+28% YoY, completing 106% of the AGM plan) for 2021. For 2022, PBT is expected to reach VND 16.4 tn (+20% YoY). We also roll forward our valuation to June 2022, and our 1Y target price for the shares of MBB is VND 36,000/share (+20% upside). We reiterate our BUY rating on the shares of MBB.

DXS is set to IPO this April, and its listing on the HOSE is expected to occur in May 2021. The charter capital of DXS prior to the IPO is VND 3.2 tn. A total of 71.7 mn shares (equivalent to a 20% stake post-IPO), which comprises of 35.8 mn new shares from the Company and 35.8 mn existing shares from current shareholders, will be on offer at a price of VND 32,000/share. 

In the coming time, DXS plans to further strengthen its leading position in the primary real estate agency industry, by further expanding its capabilities to provide end-to-end real estate brokerage services. As such, the Company will continue to focus on primary brokerage, while further expanding to the secondary brokerage by utilizing its “online to offline” technology platform. For the 2021 – 2023 period, the Company ambitiously forecasts its revenue and NPATMI to grow at a CAGR of 53% and 45%, respectively. Such an impressive feat of growth is predominantly driven by its growing the primary brokerage business, with an increasing number of units to be distributed during the period. According to the firm’s management, approximately 70% of units have been committed by developers, and they are quite confident to achieve the plan. Provided that the real estate market continues its positive momentum, coupled with the increase in income from full-service brokerage, secondary brokerage and non-cyclical fee-based services to total income, we believe that DXS could achieve its target in 2021. 

We reiterate our OUTPERFORM rating on the shares of GMD, and increase our target price to VND 38,500/share (from VND 30,800/share) – implying 11% upside. Our positive stance on the shares is supported by an improving outlook on Company performance in 2021 and beyond led by Gemalink port trends, hence we revised up our 2021 earnings forecast for GMD by 22% from our last report. From a broader perspective, we observe that a strong recovery in Vietnamese trade is well underway, which support GMD’s seaport and logistic businesses. Being one of the few logistic providers in Vietnam that possesses a fully integrated logistics network nationwide, GMD should benefit from a rapidly growing Vietnamese economy that is increasingly integrating into global manufacturing and supply chain. 

BID’s AGM was held on 12 March 2021, putting forward an optimistic PBT target for 2021 of VND13tn (+44% YoY). It also proposed a stock dividend equivalent to 12.2% for 2019 and 2020. We estimate BID’s 2021 PBT at VND13.5tn (+49.4% YoY), based on respective credit and deposit growth of 10% and 12% YoY, respectively, as well as a well-contained NPL ratio of 1.6%. Although earnings may surge in 2021, the possibility of growth beyond 2021 depends on the ability to raise capital and it will be the key upside catalyst for the stock. We reiterate our 12-month target price of VND46,430/share, which represents 7% upside. We maintain our Market Perform rating on BID. 

We maintain a MARKET PERFORM rating for VEA, with the target price of VND 46,000/share. This equal to a total return of 16% from both capital gain of 3% from the current price as of March 2^nd, 2021 and 13% from expected dividend payment of VND 6,000/share in FY21. We expect VEA gross revenue and net profit in FY21 to reach VND 3.93 trillion (+7% YoY) and VND 6.23 trillion (+10% YoY) respectively. While VEA profit may recover sluggishly in FY21, we see an attractive dividend yield of 13% in FY21 from the current share price, and an average dividend yield of 9 - 11% in the years following thereafter.

During 4Q 2020, BID’s NIM expanded by 33 bps (QoQ), pushing NII and TOI to increase 10.3% and 11.7% YoY, respectively. However, 4Q 2020 PBT plunged to VND 2.2 tn (-42% YoY) driven by a +93% surge in credit provisions. PBT in 2020 was only VND 9.21 tn (-14.1% YoY), and ROE declined to a 15-year low of 9.45%. The increase in provisioning and bad debt write-offs had quite a positive impact on BID’s asset quality, as the NPL (including VAMC bonds) and LLC ratios were each at their strong levels over the past six years. For 2021, we have increased our pretax profit forecast by 2.2% to VND 13.5 tn (+46.4% YoY). Our 2021 earnings forecast has not changed significantly, the cash dividend payment of 8% was higher than our expectation of 5%. This higher dividend negatively impacts our 2021 BVPS estimate. As a result, we lower our 1-year target price by 1.5% to VND 46,430/share, based on an unchanged P/B target multiple of 2.2x applied to our 2021F BVPS. Although earnings may surge in 2021, the possibility of growth beyond 2021 depends on the ability to raise capital and it will be the key upside catalyst for the stock. Our new price target on the shares of BID implies upside of +5.5%, and we recommend a MARKET PERFORM rating.