Company Report
At the current share price of VND 34,700/share, VRE is trading at an EV/EBITDA of 17.5x which is relatively lower than the regional peer average of 19.8x. On a growth perspective, VRE is attractive with its valuation trading at a discount vs peers while it boasts stronger projected growth for the medium term. As such, with 26.2% upside compared with current price, we recommend to BUY the stock.
12/11/2019
DownloadAt the current price, HT1 is trading at 2019 and 2020 P/E forwards of 8.5x and 7.1x respectively. We upgrade our rating from Market perform to Outperform, with a 1-year TP of VND 17,600/share (after adjusted for the TP from the ex-dividend date on Nov 11 2019) with target PE and EV/EBITDA of 8x and 5x respectively. In the next 3-6 months, the expectation of gross margin improvement and on the company’s positive earnings growth in 2020 can be a supportive catalyst for the company’s business results and stock price going forward.
11/11/2019
DownloadStandalone Q3 net sales and pretax profit amounted to VND 4.424 trillion (+25% YoY) and VND 91 bn, registering a decline by -10% YoY due to the provisioning of bad debt. The results were below our expectation. Net sales in 9M 2019 was recorded at VND 12.427 tn (+13% YoY), while pretax profit arrived at VND 292 bn (+3% YoY), fulfilling 70% and 56% of the 2019 target respectively.
11/11/2019
DownloadAt the current price of VND 18,600/share, STK is trading at 2019 and 2020 P/E levels of 6.2x and 5.5x respectively, which is rather attractive. Our 1Y target price is VND 21,400 (+15 % upside) based on the target P/E of 6.3x (current industry average P/E), equivalent to an OUTPERFORM recommendation. Downside risk to our call includes the possibility of Chinese firms dumping even lower prices than expected into the market, which will be more detrimental to the volume and ASP of virgin-type yarn, impacting the results of STK in 4Q 18 and 1Q 19. As such, this uncertainty will negatively affect the stock price in the next 3-6 months.
08/11/2019
DownloadAt the current price, AAA is trading at a 2019 and 2020 P/E forward of 6.5x and 7.3x respectively, which is quite attractive in our view compared to the 3 -year historical average of 8.5x and the regional peer equivalent of 9x. We maintain our Outperform rating for the stock, with an unchanged target price of VND 20,100/share based on the SoTP method. In the next 3-6 months, we think that the expected encouraging profit growth in Q4 driven by plastic bag segment, along with a cash dividend yield of 9.4%, can be supportive catalysts for the stock price going forward.
06/11/2019
DownloadIn Q3, PVD posted VND 1.07 tn in net sales (-20% YoY), and a net profit post MI of VND 27 bn (-76% YoY). Excluding the impacts of depreciation methodology change, provision reversals, and impact of lower JV profit, Q3 2019 operating profit would have theoretically decreased by -60% YoY. We maintain our 1-year target price of VND 18,200 (+11% from current market price) based on target unchanged P/B of 0.55x and reiterate Market perform recommendation for the time-being. Based on our estimate, we expect PVD to post a NPATMI of VND 33 bn in Q4 2019; much lower than VND 386 bn in Q4 2018. The high base from Q4 2019 was mostly from changes in depreciation methodology as mentioned above, and PVD did not retrospectively apply for the first 3 quarters of 2018, and recorded in Q4 instead. Besides earnings, the PVD price movement is largely correlated with the oil price, which is under pressure of expected weak demand caused by a global economy slowdown as well as the rising trend of using renewable energy in the future. The Brent crude-oil consensus forecast (Bloomberg polls, EIA, Goldman Sachs) is $60 USD/bbl (-6% YoY).
01/11/2019
DownloadVHC posted its Q3 earnings results, with net sales and PAT having dropped significantly on both an annual and quarterly basis. In specific, net sales declined to VND 1.882 trillion (-25.5% YoY) and PAT of VND 254 billion (-58.3% YoY). Cumulatively, net sales and PAT up to 9M 2019 reached VND 5.699 trillion (-13.3% YoY) and VND 981 billion (-5.3% YoY), completing 57% and 78% of the respective listed annual targets. VHC shares are now trading at the price of VND 80,800 per share, equivalent to 2019F and 2020F P/E forward ratios of 6.0x and 6.7x respectively – which is in the range of historical forward P/E ratio of VHC shares. To factor in our forecast of a drop in the VHC bottom line for 2020, we reduce our target P/E ratio from the previous 8.5x to 7.5x, and arrive at the target price of VND 90,000 per share (+11.4% upside) for VHC. We consequently downgrade our rating for the shares, from BUY to Market Perform.
01/11/2019
DownloadMBB posted its consolidated financial statements, complete with total operating income (TOI) and pre-tax profit for Q3 having respectively attained VND 6.345 trillion (+32.2% YoY) and VND 2.741 trillion (+25.4% YoY). Slower growth of PBT compared to TOI was mainly driven by an upsurge in provision expenses at +103.2% YoY, which raised the LLCR to 103% while kept NPLs tamed amongst peers (1.54%). Though Mcredit helped MBB achieve a higher NIM (+30 bps YoY), we need to keep an eye on mounting NPL formation rate from the last two quarters (7.21% in Q2 and 7.58% in Q3). Cumulatively up to 9M2019, despite +60.5% YoY in provisioning, consolidated pre-tax profit achieved VND 7,616 bn (+26.6% YoY) fueled by +14.3% YTD in credit and +10.8% YTD in total deposits. We like MBB, as it possesses unique advantages in terms of a low-cost funding source from its large corporate client base, while the Bank is taking advantage of the burgeoning consumer finance sector to continually expand its lending yield. The Bank thus can achieve a PBT growth higher than its pace of credit growth. Its ROE and ROA for 2020 are forecast to be 21.6% and 2.1%, rendering a current valuation at a 2019 and 2020 P/B of 1.25x and 1.16x look very attractive. With our target price of VND 30,000/share (+31% upside), we reiterate our BUY recommendation for MBB stock.
30/10/2019
DownloadPetroVietnam Gas (GAS) has released its Q3 2019 results: net sales totaled VND 19.04 tn (+3.3% YoY) and net profit dropped -10% YoY to VND 2.88 tn as a result of decreases in the fuel oil price (-14% YoY) and LPG price (-30% YoY). Compared to preliminary results, the reported number came in slightly higher, as GAS has not recorded a decommissioning expense of approximately VND 200 bn in Q3, and instead it will book an amount of c. VND 400 bn of that expense in Q4. We revised our 1-year target price to VND 109,000 (from VND 114,500), based on an unchanged target P/E of 17x (on our lower EPS estimate) and EV/EBITDA of 11x as we roll over our valuation basis to 2020F. Given only 6.7% upside from the current market price, we change our recommendation from Outperform to Market Perform.
29/10/2019
DownloadVCB has released its Q3 business results, which demonstrated vigorous growth overall. Consolidated PBT posted VND 6.31 tn, a +72% YoY rise. Cumulatively, consolidated PBT in the first 9 months of the year achieved VND 17.61 tn, a +50.8% YoY performance driven in turn by credit growth of +11.8% through 9M19, as well as deposit growth at +12.2% through 9M19. The stock is trading at 2019E and 2020E P/B ratios of 3.73x and 2.76x respectively. With remaining upside of +5.3% to our target price from the current trading price of VND 88,000 per share, we reduce our rating to Market Perform from OUTPERFORM.
28/10/2019
Download3Q19 financial results of the parent company were within our expectation, but consolidated figures beat our expectation due to the change in the method of recording revenue and profit for industrial park business. We change our 2019-2020 consolidated net sales estimates at VND 1,755 bn (+13% YoY) and VND 1,564 bn (-11%% YoY), and 2019-2020 consolidated pretax profit estimates at VND 1,642 bn (+116% YoY) and VND 1,517 (-8% YoY). 2019-2020 earnings will mainly come from land compensation income, while natural rubber business may only contribute 5%. As the change in 2019-2020 estimates was based on accounting method change, we retain our target price at VND 69,000 per share based on SOTP valuation method. This gives an upside of 11% from the current price, equivalent to MARKET PERFORMANCE rating.
28/10/2019
DownloadPNJ recently released its Q3 results, wherein net sales reached VND 3.9 tn (+24.7% YoY) and net profit attained VND 208 bn (+17% YoY). This greatly exceeds our expectations, especially given the fact that net profit recorded in July and August declined by -5% YoY. We estimate that in September 2019 alone, net profit surged by 60% YoY. Cumulatively up to 9M 2019, PNJ recorded net sales of VND 11.7 tn (+11.1% YoY) and net profit of VND 811 bn (+16.1% YoY). This performance in turn achieved 64% and 68% of the annual sales and net profit target for the year.We maintain our forward-looking estimates for PNJ in 2019 to achieve sales of VND 15.9 tn (+9.1% YoY) and net profit of VND 1.15 tn (+19.9% YoY). In 2020, we look for net sales of VND 17.6 tn (+10.8% YoY) and net profit of VND 1.3 tn (+15.5% YoY). At the current price of VND 82,800/share, PNJ is trading at a 2019 and 2020 P/E of 16.9x and 14.6x respectively. Our 1Y target price for the stock is VND 93,600 (+13% upside), using our current full year 2020 estimates and an unchanged target P/E ratio of 16.5x, equivalent to an OUTPERFORM rating.
24/10/2019
DownloadAccording to Hoa Phat Group (HPG), Q3 revenue and net profit posted VND 15.35 trillion (+8% YoY) and VND 1.794 trillion (-26% YoY), in line with our expectation. Cumulatively, 9M 2019 revenue and net profit would reach VND 45.9 tn and VND 5.65 tn, accomplishing 66% and 84% of its annual target. At the current price, HPG is trading at 2019E and 2020E forward P/E ratios of 8.1x and 6.2x respectively, which is quite attractive in our view. We maintain our BUY rating for the stock, with a 1-year target price of VND 31,950/share based on target P/E and EV/EBITDA metrics of 9x and 6.5x respectively (revised from VND 32,100 based on 9x and 7.5x).
23/10/2019
DownloadWith the current hog supply shortages running up to Tet holiday as well as the recent rapid hog price increase since October 2019, we expect the company’s net profit to turn around, at least in the next 2 quarters. DBC share price has also recently recovered by ~6.7% since early October, in line with the hog price increase. At the current price of VND 23,700/share, DBC is trading at 2019 and 2020 P/E ratio of 9x and 7x respectively. In 2019, we estimate that net sales and net profit might reach VND 7.6 tn (+13.3% YoY) and VND 256 bn (-28.9% YoY). In 2020, we estimate net sales and net profit might reach VND 8.1 tn (+7.7% YoY) and VND 332 bn (+29.7% YoY). Our forecasts have not taken into account any additional real estate revenue that might already be booked. Our 1Y target price for the stock is VND 27,300 (+15.1% upside), equivalent to an OUTPERFORM rating.
22/10/2019
DownloadAt the current price, VGC is trading at 2019 and 2020 PER levels of 12.6x and 10.5x respectively. Given the above information, our rating for the stock is Outperform with a 1-year target of 23,050 VND/share, implying an upside of 19% from the current price. Besides the encouraging earnings growth thanks to the strong performance of industrial park and the potential recovery of sanitary wares in 2020, the coming state divestment and a cash dividend yield of 5.5% can also be supportive catalysts for the stock over the next 12 months.
16/10/2019
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