Company Report

We have witnessed encouraging quarterly results and the prospect of an improved economy reinforces our confidence in SAB’s growth going forward. However, we remain cautious regarding potential headwinds, including regulatory challenges, intensified competition, and the risk of further increases in aluminum prices. As a result, we lower our forecasts for 2025E net sales and NPATMI to VND 33.3 tn (+4.4% YoY) and VND 4.6 tn (+6.2% YoY), respectively. Our earnings forecast for 2025 is 7% lower than our previous forecast, as we lower the GPM forecast from 31% to 30.2% and increase the A&P-to-sales margin from 12% to 12.7% to match 2024 spending levels.

We continue to rate the shares of SAB as MARKET PERFORM, given the challenging outlook. Our 12-month target price for SAB is lowered to VND 58,000/share (from VND 64,500/share), indicating an 11% potential upside.

2025 growth should likely converge to an organic level, without outliers.

Between 2025-2026, HHV plans to issue around VND 1 tn in charter capital to support new BOT infrastructure projects, while potential BOT projects likely require substantial additional funding.

With stable operations and the government's ambitious public investment plans, we believe that the shares of HHV are  well-positioned to benefit from accelerated public investment.

Our 2025 sales and NPAT estimates are approximately VND 3.7 tn (+11% YoY) and VND 519 bn (+9.7% YoY), respectively. Our DCF model provides a one-year target price of VND 15,100 per share, and we reiterate our Outperform rating on the shares of HHV.

While the company's operations remain stable, supported by a robust construction backlog and the government's ambitious infrastructure development targets, we believe that the stock is an opportune vehicle to capitalize on the theme of public investment acceleration, which could boost infrastructure development-related stocks.

Becamex IDC (BCM) is the undisputed leader in Vietnam’s industrial and urban development, uniquely positioned to capitalize on surging land values, rapid industrial expansion, and strategic joint ventures. With an extensive land bank in Vietnam’s top manufacturing hub, BCM is set to deliver significant earnings growth fueled by upcoming land price adjustments, high industrial demand, and a thriving partnership with VSIP. Notably, in a market where major deals have been scarce in recent years, BCM’s current proposition stands out as an exceptional entry point for investors. We believe BCM is at the early stages of a multi-year growth cycle, making this a rare and compelling investment opportunity. Given these outstanding fundamentals, our rating for the stock is OUTPERFORM with 1-year target price of VND 89,900/share.

• Market share gain to offset tepid consumption recovery for ICT & CE
• Accelerated grocery new openings to secure long term growth
• Both the Erablue and Avakids chains turned profitable (as of 3Q24 and September 2024 respectively), while the An Khang pharmacy chain is expected to reach breakeven in 2Q25.

Investment view: The management has set a 2025 revenue target of VND 150 tn (+12% YoY) and net income at VND 4.85 tn (30% YoY), which implies stable earnings for ICT & CE segment, consistent with the gradual recovery in consumption spending. Despite the slow pace of consumption recovery, MWG’s robust business model across major segments and the anticipated mobile phone replacement cycle are expected to drive significant earnings growth in 2025.  However, we may need to revise our 2025 earnings estimates on weaker consumption growth, and detailed projections and valuation will be provided in our fortcoming report. 

We reiterate our OUTPERFORM rating on the shares of HDG, along with our 1-year TP of VND 33,100/share (representing 19% upside).

2024 results trailed our forecast primarily due to higher-than-expected bad debt provision in 4Q24 related to receivables from the Hong Phong 4 solar farm. As expected, HDG did not launch the next sales phase of Hado Charm Villas project during the year. The electricity segment continued to be the dominant segment in terms of both revenue and earnings.

Outlook: We expect 2025 NPATMI growth of 43% YoY, primarily driven by the real estate and electricity segments. Specifically, we expect the next sales phase(s) of Hado Charm Villas for 2025 to support 69% YoY revenue growth for the real estate segment, along with the continuing recovery of the hydropower portfolio. Meanwhile, we remain concerned about the legal risk related to Hong Phong 4 solar farm (we apply a -10% discount on our valuation for HDG). Over the longer-term, we forecast that the Hado Green Lane and Hado Minh Long projects will realize revenue between 2027-2030.

We lower our rating to Outperform from Buy for TCB, with 1Y TP of VND 29,200/share - representing an upside of 13% as the shares increasing 8.7% from our last report. We still expect property revival during 2025, with numerous projects up for sale. This should be a positive catalyst for TCB. Given the brighter fundamentals from 2025, TCB valuation is attractive with a forward P/B of 1.07x, which is well below its historic average of 1.4x.  

We project 2025 pretax profit to expand to VND 33.5 tn (+21.8% YoY vs. our previous forecasts of 15.2% YoY), driven by better non-NII (+16.8% YoY) and lighter credit costs (0.55%, -16 bps YoY). We believe that the property recovery will be the main driver to achieve credit growth of 21.8% YTD with the focus on mortgage lending. With several supporting mechanisms including the flexible pricing scheme, bullet payments, and incentive lending rates, we believe that asset quality should be well managed and gradually improve along with the revival of property market. The NPL ratio is projected to be 1.05% in 2025. However, the NIM us expected to be under pressure at 4.2% (-3 bps YoY), due to the intense competition and rising funding costs.

Maintain BUY. Fine-tuning 2025 estimates and target price to VND 33,500/share (from VND 31,700/share), based on unchanged P/E and EV/EBITDA targets of 15x and 8x respectively. Dung Quat 2 being put into operation and announcement on prelim AD duty for imported HRC from China and India are 2 key catalysts for the share price.

2025 outlook is positive for both the sector and HPG,  with revenue and NPAT growth of 15.9% YoY and  28% YoY respectively, thanks to: public investment strongly pushed and the recovery of the real estate market, with higher steel volumes from Dung Quat 2 – Phase 1 operation from 1Q 2025 and base-case assumption for HRC AD duty to be applied for China HRC imports.

We see minimal to slightly positive impact for HPG from Trump’s recent tariff on steel imports. The recent proclamation to raise US import tax for steel to 25% by Trump does not impact Vietnam steel directly, as Vietnam steel exports to the US have already been taxed at 25% since 2018, and the recent action of Trump would put Vietnam steel exports to the US on a relatively more equal footing compared to other countries.

We lower our rating to OUTPERFORM (from BUY) on the shares of FPT, with a 12-month target price of VND 176,400/share (from VND 186,300/share) (representing 23% upside), as we revise down our 2025 NPATMI estimate by 5%. In fact, based on the current implementation progress of FPT AI Factory project and the weak enrollment situation of FPT Education, we believe that 2025 revenue from FPT AI Factory and the education segment may not meet our previous expectations. Nevertheless, we still project double-digit growth for FPT during 2025 (19% YoY for revenue and 22% YoY for NPATMI), whereby the technology segment will continue to be the primary growth driver.

Upside potential: Higher-than-expected revenue growth from the Americas; faster-than-expected economic recovery to support domestic IT, and online advertising segments.

Downside risks: Higher IT engineer salaries, lower-than-expected revenue/contract value from software and IT services, and slower-than-expected implementation progress at FPT AI Factory.

During the analyst meeting, the management reaffirmed PNJ’s ability to gain market share, though they still expressed concern over the gold shortage issue. This is in line with our recent view on PNJ that the gold shortage issue may still linger in 2025. The gold price has retreated recently after reaching an all-time high in early February. However, the price correction is quite negligible, and the gold flow on the market remains tight. As such, a change in Decree 24/2012/ND-CP (expected in September 2025) should be crucial to create conditions for jewelry and gold retailers to grow in the long term.

PNJ will publish a detailed 2025 financial plan in late March, along with AGM documents. We currently forecast an expanded net income for PNJ in 2025 to VND 2.5 trillion (+17% YoY) and maintain a BUY recommendation with a 1-year target price of VND 123,000 per share.

We upgrade our rating for VNM from MARKET PERFORM to OUTPERFORM as we believe the share price is oversold and now presents an 18.6% potential upside to our DCF-based 12-month TP of VND71,500/share (from TP of VND75,000/share as we lower our 2025E forecast due to a more cautious view on recovery).

Total sales for 4Q were lower due to domestic market pullback. VNM posted 4Q24 net consolidated revenue and NPAT of VND15.47tn (-1% YoY) and VN2.15tn (-9% YoY), respectively, missing our NPAT estimate of VND2.29tn. 

Higher ingredient prices pressure profitability. 4Q24 NPAT saw a decline of 9% YoY, a result of both lower sales and GPM (GPM saw a 112bp decrease YoY to 40.1%). For 2024, VNM post net consolidated revenue and NPAT of VND 61.8 tn (2.3% YoY) and VND9.45tn (4.8% YoY), respectively, trailing our FY24 NPAT estimate of -2.6%, and barely achieving the company’s annual NPAT target.

We raise our rating on KBC from OUTPERFORM to BUY, setting a target price of VND 37,500 per share (30.2% upside). Our upgrade is based on: Anticipated successful sales launches and recognition of TD3 IP and Trang Cat Township, which have recently been granted investment approvals in principle and should drive earnings growth over the medium-term. Expected strong sales at current industrial parks, including Nam Son Hap Linh IP, following disappointing 2024 results.Strong growth of 2025 NPATMI is expected to reach VND 2.18 tn (411.1% YoY) and the highest earnings level since company inception.

2024 results: KBC reported net sales of VND 2.77 tn (-50.6% YoY) and NPATMI of VND 426.1 bn (-79.0% YoY), falling short of expectations due to lower industrial land leases. KBC recorded the sale of only 33 ha of industrial land, compared to the estimated 50 ha, with limited cleared land available for sale.

Reduced Target and Earnings Forecast: Given the weaker 4Q24 results and the likelihood of lower financial income, we lower our 2025 earnings forecast and our 1Y target price to VND 169,000 per share (taking into account the share price adjustment after right issue in early February). We rate the shares of MCH as MARKET PERFORM.

4Q24 results: Net sales and net income of MCH totaled to VND 8.9 tn (5% YoY) and VND 2.37 tn (2.7% YoY), respectively, for 4Q24. This is lower than our estimate due to: (i) distributor destocking of convenience food post-typhoon during 3Q24; (ii) poor home personal care (HPC) sales due to temporary distribution disruption of NET products; and (iii) the decline in financial income.

4Q 2024 came out outstanding, with consolidated revenue of VND 1.4 trillion (36% YoY and 11.7% QoQ), pushing the top line to an all-time high. Core PBT (before other income/expenses) reached near a historically high level of VND 684 bn (boasting 137% YoY and 19% QoQ.) 

One-off expenses and earnings: GMD booked one-off income of VND 226 bn from reversal of THE payable provision, which is a normal operation according to management. It also booked a one-off in other income of VND 458 bn, which are provisions for a vessel incident as well as rubber plantation expenses, but the company does not provide a clear breakdown for each item(s).

2024 summary: GMD FY2024 revenue and PBT reached VND 4.8 trillion (25.6% YoY) and VND 2.1 trillion (-25% YoY), a bit lower than our PBT estimates of VND 2.2 trillion due to higher provision booking than expected. Income could be even greater in 2025 were this to be reversed.

On February 11th, 2025, KDH hosted its 4Q24 earnings call to update on quarterly performance and project progress. We maintain our BUY rating for KDH, with a target price of VND 41,500 per share, representing a 22% upside.

Looking ahead to 2025, we expect the recognition of the remaining sold units at The Privia and income from upcoming sales phases of the low-rise section of the joint venture project with Keppel (11.8 ha in the suburb of Thu Duc located right next to HCMC, with KDH owning 51%) to be the main drivers for our 2025 forecast.  As a result, KDH is expected to achieve 2025 net revenue of VND 6.28 tn (+91.6% YoY) and NPATMI of VND 1.18 tn (+46.1% YoY).During the earnings call, KDH management expressed optimism about the real estate market’s development, noting that many developers are preparing to launch new projects in line with new land-related laws, which should enhance market transparency and growth.