Vietnam grocery retailers – Gradually finding the key to tapping into the industry's vast potential
27-06-2024
: MWG, MSN
: Retailing
: Hung Nguyen
Tags:
- The fast transformation in consumer habits to modern channel instead of wet market/small local grocers, implies that Vietnam grocery retailing market is the fertile land for modern players.
- Due to their prominent market position and extensive store network, coupled with substantial potential for ongoing cost improvements compared to their Asian peers, these chains are poised to play pivotal roles in shaping the long-term prospects of MSN and MWG
PC1 – Stellar growth due to recovered demand for power construction and contribution of nickle mining
26-06-2024
: PC1
: Power
: Thang Hoang
Tags:
- PC1 reported stellar results in Q1 2024 with revenue of VND 2,165 bn (+44% YoY) and NPAT-MI of VND 81bn (+449% YoY), which are driven by contribution of nickel mining segnebt
- We forecast 2024F revenue of VND 10,245bn (+31% YoY) and NPAT-MI of VND 426bn (+212% YoY), which is driven by (1) strong recovery of both power construction and steel pole production segments and (2) full year contribution of nickel mining segment
- We estimate PC1’s target price of VND 29,500/share using Sum of the part (SoTP) valuation method, of which forward P/E is 20x and the corresponding expected return is 4% based on closing price as at June 25,2024. We think current market price has fairly priced in 2024F growth prospect
Update on monetary market in Jun 2024
25-06-2024
: VDS
: Macroeconomics
: Ha My
Tags: Monetary market
- The SBV net withdrew for the second consecutive month.
- Concerns about the upward trend of DXY in the second half of 2024
FPT – Financial Performance Update 5M-2024 and Projections Update for 2024F
24-06-2024
: FPT
: Technologies
: Tung Do
Tags:
- 5M-2024 Business update. FPT reported a revenue of VND 23.9 trillion for 5M-2025, marking a 20% YoY increase. Net profit reached VND 3.1 trillion, reflecting a 21% YoY growth. These figures represent 38% and 39% of our full-year 2024 projections of VND 63.1 trillion in revenue (20% growth) and VND 7.8 trillion in net profit (21% growth).
- Forecast adjustments for 2024F. Given the financial results of the first five months, we have revised our assumptions and increased our forecasted net profit for 2024F by 1% to VND 7.9 trillion, a 21.5% YoY growth.
- Valuation and recommendation. Using a sum-of-the-parts valuation method, we estimate FPT's fair value at VND 142,400 per share, implying a total expected return of 9% (including a cash dividend of VND 2,000). We recommend ACCUMULATING FPT. Despite the rapid valuation increase potentially limiting short-term upside, we remain confident in FPT’s robust and stable profit growth prospects, supporting a long-term positive trend for its stock price.
Seafood Industry – The Competitive Situation of the Pangasius and Whiteleg Shrimp Sectors
21-06-2024
: VHC
: Fishery
: Hien Le
Tags:
- According to the June 2024 Food Outlook report by the Food and Agriculture Organization of the United Nations (FAO), farmed seafood is expected to grow strongly due to increasing consumption trends, which will support the aquaculture industry in Vietnam in the long term.
- The pangasius industry has seen year-to-date growth compared to the same period last year, primarily driven by increased production in key markets, while the average selling price remains lower than the previous year. Pangasius products in the U.S. are facing increasing competition in fresh salmon consumption despite high salmon prices. However, we expect pangasius production to gradually improve month by month until August, benefiting from gaining market share over tilapia, which is currently priced lower, thus creating a competitive advantage. Additionally, the gradual increase in tilapia prices also supports the gradual increase in pangasius selling prices
- The shrimp sector experienced growth in the first four months of the year compared to the same period last year, primarily due to increased production, while the average selling price remained lower than the same period. In the whiteleg shrimp segment, selling prices in various markets are still low and have not shown strong recovery trends. However, the Japanese market has maintained competitiveness compared to other countries, while the Chinese and US markets face more difficulties due to Ecuador gradually gaining market share.
PVD – All rigs under firm contract until the end of 2025
20-06-2024
: PVD
: Oil & Gas
: Ngan Le
Tags: PVD 1Q2024
- In 1Q24, PVD recorded revenue of VND 1,756 bn (+43% YoY), driven by the drilling services segment. For 2024, projected revenue is VND 7,305 bn (+26% YoY), with NPAT-MI reaching VND 1,098 bn (+88% YoY). EPS FY2024 is VND 1,974.
- The prolonged high oil prices have boosted exploration and drilling activities in Southeast Asia. Consequently, all of PVD's rigs have fixed contracts until the end of 2025, with rental price reaching USD 105,000/day (+11% YoY). We estimate that PVD's profit in 2025 could increase by 22% YoY to VND 1,343 bn, with EPS and BVPS come at VND 2,389 and VND 30,718, respectively.
- Drilling activities in the domestic market are expected to pick up in 2025-2027 period, driven by key oil and gas projects such as Block B, Su Tu Trang 2B, and Lac Da Vang. However, we believe that the current price already reflects the company's profit growth prospects for the next 12 months, so we maintain our target price at VND 34,000/share, which is 8% higher than the closing price on June 19, 2024, corresponding to a NEUTRAL recommendation for this stock.
According to MSCI's assessment, what are the prospects for market upgrades and how extensive is the path to emerging markets?
19-06-2024
: VDS
: Financial Services
: Hung Le / Thao Phan
Tags:
- Opportunity to elevate the market status to "emerging".
- Vietnam's stock market is progressing along the upgrade path.
- What impedes progress and how can it be addressed? - Enhancing the transparency of foreign ownership and the efficiency of market operations for foreign investors are critical areas for improvement.
Seaport industry – The demand for imports and exports is forecasted to continue its uptrend in 2H2024
18-06-2024
: GMD, VSC, HAH
: Seaports
: Quan Cao
Tags:
- Accumulated 5M2024, the estimated value of container via sea ex-im of goods were USD 84 billion (+10% YoY) and USD 56 billion (+9% YoY), respectively.
- Accumulated 5M2024, the container throughput in Hai Phong and Vung Tau regions were 2.9 mn TEUs (+21% YoY) and 2.5 mn TEUs (+36% YoY), respectively.
- The demand for trade flow is forecasted to continue its growth trend as manufacturing enterprises receive many new orders for the peak season in the second half of 2024.
Update on trade growth in May 2024
17-06-2024
: VDS
: Macroeconomics
: Ha My
Tags: Trade
- The trade deficit in May 2024 narrows compared to the GSO’s estimate.
- Exports of machinery and equipment increased sharply in May 2024.
- Comments on some events related to Vietnam's trade prospects
ICT/CE retailing giants – Declining market share in the ICT/CE pie gradually losing its flavored taste
14-06-2024
: MWG, FRT
: Retailing
: Hung Nguyen
Tags: MWG FRT
- The ICT/CE main segments (laptop, tablet, phone, air-conditioner, refrigerator, washing machine, TV) come to the mature phase, demonstrating by the high penetration rate and the stagnant sales volume, thus all players concentrate on expanding its pie like the way to beat the one-digit market growth.
- The fast change of consuming habit from offline to online, much hurting ICT/CE retailers mainly depended on physical store chain like MWG, FRT. Although they start to shift business model to one that is more reliant on online sales, we are viewing that MWG, FRT are hard to prevail over E-Commerce platforms (ECPs) due to its much smaller finance ability to build up the large scale of economics (customer base), supporting the cost optimization (such as delivery cost) and wide revenue expansion, led to take a big profit like Shopee.
- In addition, ICT/CE retailing giants will also face the hard rock in offline channel, owing to the higher positioning of smaller retailers (such as CellPhoneS, HoangHaMobile, Shopdunk), setting the cheaper price (due to the low operating exp/net sales than that of MWG, FRT per our estimation) but provide the similar customer experience (pre & post-service)
ECB's initial rate cut and the 2024 outlook for further reductions
13-06-2024
: VDS
: Macroeconomics
: Luân Phạm
Tags:
- ECB cut interest rate amid rising inflation.
- Cautious on short-term inflation projection due to wage pressure.
- Geopolitical tensions and interest rate divergence: risks for the Euro.
REE – Strong real estate sales to catapult 2024F earnings growth
12-06-2024
: REE
: Power
: Thang Hoang
Tags:
- REE reported weak Q1 2024 results with revenue of VND 1,837 bn (-22% YoY) and NPAT-MI of VND 362 bn (-36% YoY). The power generation segment’s Q1 NPAT-MI slumped by 52% YoY to VND 238bn due to unfavorable weather conditions and lower participation in competitive generation market.
- We forecast 2024F revenue of VND 9,480 bn VND (+7% YoY) NPAT-MI of VND 2,411 bn (+10% YoY), which is mainly driven by strong results of real estate segment with 2024F revenue of VND 2,040bn (+95% YoY).
- Based on on the Sum of the Parts (SoTP) method, we value REE at VND 64,000/share based equivalent to a forward P/E of 12.5x and expected return of 1% based on the closing price on June 12th, 2024. We noted that REE share price increased 29% since our previous BUY recommendation on Feburary 16th. Looking forward to 2025, we expect REE to main growth as (1) Hydropower plants recover as La Nina returns and (2) higher occupancy rate of Etown 6 office building.
27-06-2024
335 
