Company Report

ACV’s 2018 consolidated revenue (ex-landing charges) reached VND 16.136 tn, up 16.3% YoY driven by (1) a 7% YoY increase in passenger traffic as well as (2) a 28% YoY rise in average domestic passenger charges. Further, NPAT reached VND 6.215 tn, up 51% YoY thanks to (1) GPM expansion and (2) high net financial income. At the current price of VND 88,600/share, ACV is trading at a 2019-2020F EV/EBITDA (ex-landing charges) of 14x and 12.7x, respectively, which is in-line with the average for global airports.

BIDV (BID: HOSE) posted VND9.473tn in PBT, translating into 9.3% YoY growth in 2018. This level of PBT growth is quite weak compared to the industry average of 31.6%, but this was not a surprise as the bank was still making progress in resolving its legacy bad debt, while desperately lacking capital to fuel credit growth. At the market price of VND32,850 per share, BIDV is trading at a 2019E PBR of 2x and a post-money 2019E PBR of 1.7x.

Net sales in 2018 went flat at VND 3,920 bn (+2.5% YoY) with total sales volume virtually unchanged at 94,582 tons (+0.2% YoY) and falling short of 5.4% of the volume targets. Although the sales of the PPR products more than double compared to last year, its contribution to the overall sale growth is minimal as it just accounts for 1% of total volume. Meanwhile, PVC products stills accounts for the majority of 85-86% of total sale volumes, whereas PE makes up a smaller share of 7%. At the current price, BMP shares are trading at 2019 PER of 9.6x, which is below the historical 3-year average of 12x due to the slowdown in BMP’s business results in the recent years.

In its unaudited financial statements for 2018, PetroVietnam Gas (GAS) reported VND 75.6 tn in net revenue (+17.2% YoY) on a consolidated basis, and VND 12.36 tn in consolidated net profit (+24.3% YoY). We revise upwards our 12-month target price for GAS to VND 106,000 from VND 95,500 after taking into account our upward earnings revisions, based on an unchanged target P/E of 17x and EV/EBITDA of 10.5x.

Military JSCB (MBB: HOSE) posted robust PBT growth, with a consolidated pretax profit (PBT) of VND 7.767 tn (+68.3% YoY). Again, this growth level is something we expected (i.e. 2018 PBT of VND 7.626 tn) as stated in previous report, but it’s worth reiterating that this kind of growth trounces 2017 PBT growth levels of 26.4% YoY. Parent bank PBT also grew 31.3% YoY to VND 7.03 tn. Similar to 2017, earning growth is driven by customer loan growth, especially individual loans, and NIM expansion. Non-NII also showed an outstanding growth at 87% YoY, resulting in 25% of Total operating income (TOI). CIR was higher as expected (i.e. 44.7%). Provision expenses were slightly higher than forecasted. At VND 22,050 per share, MBB is currently trading at 2019 PBR of 1.3x. We recommend a BUY rating with a 1-year target price of VND 30,800, equivalent to PBR 1.8x.

In 2018, TCM posted net sales of VND3.66tn (+14.1% YoY) and net profit of VND260bn (+35.2% YoY). Excluding one-off items relating to one closed-down spinning factory and the provision of doubtful debt for Sears, net core profit would have arrived at VND284bn (+78% YoY). Gross profit margin expanded from 15.7% in 2017 to 18.5% in 2018 thanks to: (i) change in the sales mix towards fabrics and garments, which had higher margins than yarns; (ii) the increase in woven fabrics’ gross margin and (iii) yarn margin turning positive in 2018, from negative in 2017. At the current price of VND29,600/share, TCM is trading at 2019 and 2020 PERs of 7.4x and 6.1x respectively. Our rating for the stock is Market Perform with a 12-month-target price of VND30,700 (+3.7% upside), based on the industry average PER of 7.5x.

Vinhomes JSC posted 2018 net revenue of VND 38.8 trillion, an increase of 154% YoY, which largely originated from the handover of units relating to Vinhomes Metropolis, Vinhomes Green Bay, Vinhomes Golden River and Vinhomes Central Park. As such, sales of inventories made up 92.2% of total revenue, staging an increase of 179% YoY. Meanwhile, other businesses including leasing, property management, and construction services also accelerated in 2018 due to corporate restructuring practices carried out during the year.

HPG’s revenue and net profit for 2018 came in at VND 55.8 tn (+21% YoY) and 8.6 tn (+7% YoY), respectively. On a standalone basis, revenue in the final quarter reached VND 14.4 tn, an increase of 13% YoY. Meanwhile, net profit dropped by 26% YoY to VND 1.76 tn, mainly attributed to the contraction in the gross margin. Gross margin shrank from an average of 22.8% in the previous 4 quarters to 17.8% in Q4, which was largely attributed to the 11% correction in the steel price during the last 2 months of the year, with a 17% decline in Chinese steel prices reported over the same period. At the current price, HPG is trading at 2019 and 2020 forward PERs of 7.5x and 5.6x respectively. We cut our 2019F revenue and net profit by 7-10% to reflect the 4Q18 results. As a result, we lower our 12-month TP to VND 39,300 (from VND 44,700) based on an unchanged target PER and EV/EBITDA of 9x and 7.5x respectively, but reiterate our BUY rating for the stock.

2018 consolidated revenue of VND28.561tn (+5.2% YoY) came in line with guidance, yet was 2.5% below consensus due to several project delays. CTD’s revenue growth of 5.2% YoY in 2018 was lower than the 31% YoY and 52% YoY achieved in 2017 and 2016, respectively, but still positive when compared to several listed peers amid the slow housing market.