Company Report

At the current market price of VND 30,300/share, QNS is trading at 2019P/E and 2020 ratios of 7.7x and 7.4x, which is around a 50% discount compared to overall market valuation. We consider these price levels to be relatively cheap, despite the fact that we agree that the stock should be traded at some discount given its irregular approach to investor relations activities, and because of its large exposure on a commodity business like sugar. Our 1-year target price for QNS arrives at VND 35,400/share (from VND 37,500/share), based on a target P/E of 6x for sugar & biomass, and 10x for soymilk and other consumer businesses (confectionery, beer and beverages). With a 16.8% upside, we continue our Outperform rating for the stock at the moment.

KIDO Corporation (KDC) posted VND 3.22 tn in revenue (-14.7% YoY) and VND 113 bn of net profit (+135% YoY) for H1 2019. In terms of sales, a decline came about because of lower edible oil revenue (-28.9% YoY), while ice cream sales advanced 8.8% YoY. In contrast, strong growth in net profit on a low base from H1 2018 was thanks to (1) a general recovery seen for KDF, its frozen food operations (NPAT reached VND 92 bn vs. VND 45 bn in H1 2018) and consolidation of Golden Hope (GH) of approximately VND 11.5 bn in PBT, as KDC increased its stake in Golden Hope to 51% in November 2018, and then further to 76% in Q1 2019. Net earnings to parent shareholders totaled VND 49 bn, representing only 43% of net profit in H1 2019, yet was a turnaround from a loss of VND -11 bn in H1 2018.

At the current price, GEX is trading at a 2019 PER forward level of 12.3x. We maintain our Market Perform rating for the stock, with a 1-year target of VND 22,500/share based on the unchanged target PERs of electrical equipment, logistics, and utility segments of 11x, 9x and 8x respectively. Our valuation does not take into account the property segment until further project details and clear pipeline are provided.

At the current market price, VTP is trading at 2019F and 2020F P/E ratio of 21x and 15x respectively. We maintain our estimates that VTP earnings can grow at 41% YoY in 2019 and 40% YoY in 2020, thanks to strong growth in e-commerce activity driving delivery business forward. We also maintain our OUTPERFORM rating for the stock, with a target price for VTP at VND 170,900/share, based on a 2020 P/E target of 20x.

BID posted a Q2 PBT of VND 2.19 tn, -11.9% YoY. While pre-provision operating profit rose by +19.2% YoY, that gain was offset by higher provisioning costs to account for the treatment of credit losses, which rose by +38.5% YoY. We raise our target P/B ratio for BID from 1.8x to 2.0x, which results in a target price of VND 42,900 per share using 2020E BVPS (previously VND 35,700 based on 2019E BVPS). With a 1-year upside potential of 11.4%, we upgrade our rating on BID to OUTPERFORM from Market Perform.

At current price of VND 84,200/share, VHM is being traded at 2019 P/E metrics of 13.7x, which is low compared with industry peers. Regarding to valuation, after reviewing actual unit prices and sale progress (including both retail and bulk sales) at the three mega projects which are better than our previous assumptions, our target price is raised from VND 91,400/share to VND 99,000/share, implying an upside of 17.6% compared with the current market price. Hence, our rating is OUTPERFORM for the stock at present.

Our current base case assumption that Brent oil price will average at USD 65/bbl in 2019-2020. Accordingly, our 1-year target price for PVS arrives at VND 25,100/share (from VND 27,000/share) on a lower earnings forecast for 2019F/2020F, which is based on a lower target P/E of 12x (from 13x, vs. regional median level of 12.8x) and target P/B of 1x. We reiterate an Outperform rating for the ticker, based on current market price.

We raise our 12-month target price to VND82,400, based on an unchanged PBR target of 3.0x applied to our 2020E BVPS of VND27,452 (previously VND81,300 using 2020E BVPS of VND27,093), for a potential upside of 2.36% from the current price of VND80,500. Please note that this does not consider the cash dividend of 8% at par in 2019E and 2020E. Given the limited potential upside, we maintain our Market Perform rating.

At the current price of VND 103,700, shares of MWG are trading at 2019E and 2020E PERs of 12.0x and 10.1x respectively. The stock price has increased by 14% in the past one month. We think the main reasons for the good performance of the stock include: (i) the impressive business results of the company in 5M19, especially Bachhoaxanh; and (ii) the impressive performance of its covered warrants. We maintain our SOTP-based 12-month TP for MWG of VND160,300/share for a 54.6% upside potential, and reiterate our BUY rating.

At the current price, HSG is trading at 2019 and 2020 PER forward metrics of 9.4x and 9x respectively. We maintain our Market Perform rating on the stock, with a target price of VND 8,100/share based on consistent PE, PB and EV/EBITDA targets of 7x, 0.6x and 6.5x respectively. We think that the recovery in profit margin and the stabilization in the galvanized steel market can be supportive factors for HSG in the coming time. However, we think that the stock can be more attractive in case the company shows improvement in sales volume and market share.