CTI - Rebound in 2H 2018

Cuong Thuan Investment Development IDICO JSC (HSX: CTI) specializes in infrastructure construction and quarries. It focuses on these as a long-term growth driver. Most of its projects are located in the Dong Nai province.

Top line revenues dropped in the first half, except for stone quarries. Revenues and NPAT came in at VND 416 billion (-25% YoY) and VND 56 billion (-20% YoY), respectively. Construction income fell 63% YoY, mainly caused by a six-month pause in BOT 319 Long Thanh - HCMC. BOT fees slightly decreased. Quarries revenue surged 118% albeit a layoff from quarry Doi Chua 10, showing ramp-up demand and scale-up production. Major production increased sharply in Tan Cang 8 and Xuan Hoa quarries, with an estimated monthly revenue of VND 10 billion.

GEX – Restructuring of the electrical equipment sector promises positive results

After completing the M&A and restructuring process, GEX electrical production mix will cover fully high, medium and low voltage. We believe that the diversified production mix is an advantage for GEX. All of the subsidiaries have been established for a long time and have a good reputation in the industry. Increasing ownership and management improvement promises positive results. Information transparency after the delisting of the subsidiaries and the centralized management structure through the holding company Gelex Electric remain a matter of concern. Overall, we think that the restructuring of the electrical equipment sector will bring positive effects to GEX.

Competitive Landscape of the Battery Industry and Position of PAC

Despite fierce competition, PAC’s market share remains stable. We believe that its distribution system management plays an important role in the success of this firm.

Positive information for downstream ports in Hai Phong

The Ministry of Transport (MoT) is drafting a circular regulating prices for a range of services at seaports in Vietnam to replace old decisions

MWG – Company Report introduction

Rong Viet Securities Corporation hereby presents the Company Report on Mobile World Investment Corporation (HSX: MWG) with the overall opinion as follows:

“Bach Hoa Xanh – the grocery chain has been identified by MWG as its focus for the medium and long term. We believe Bach Hoa Xanh is showing a lot of positive developments, especially since MWG adjusted its expansion strategy in the second quarter of this year. Most of the new stores have achieved the required customer traffic as well as sales in a very short time. The chain is also getting closer to the EBITDA break-even level.

VJC - Result Update on VietJet Aviation JSC

Rong Viet Securities Corporation hereby presents the Result Update on Vietjet Aviation JSC (HSX: VJC) with the overall opinion as follows.

PVB - Remove the obstacles

PVB is the first and exclusive coating company in Vietnam that supplies the service for most of oil & gas projects. The operations of PVB used to be in favorable conditions when oil prices were high and the oil & gas projects in Vietnam were in progress.

PAC – Short Term Outlook Remains Stable

2018 performance is expected to witness a slight improvement due to a decline in input material prices. However, in our opinion, there are still problems that PAC needs to tackle. 

CTG: High Provision Charges Likely to Undermine Earnings

In the first half of 2018, CTG’s total operating income (TOI) grew 6.2% YoY to VND 17.3 Tn. While net interest income (NII) grew 7% YoY and associated income declined 62%, services income became the bank’s driver with 32% YoY growth. It should be reminded that CTG divested from Aviva Assurance and reported one-off profit in 1H 2017. Excluding this amount, associated income grew 32.4% YoY, mostly contributed by Indovina’s earnings. CTG’s 1H 2018 PBT and NPAT were VND 5.3 Tn (+9.4% YoY) and VND 4.2 Tn (+8.5% YoY) respectively.

Digiworld is back distributing Nokia’s phones – the overall picture

On September 26, Digiworld and Nokia HMD signed a contract in which Digiworld will become the official distributor of Nokia products in Vietnam.

Vinamilk – Seeking Opportunities in New Export Markets

With the local demand for dairy products slowing down, large firms such as Vinamilk, are faced with one-digit organic growth over the next few years.  Hence they are seeking opportunities to add products as well as expand in international markets.  This is ceratinly a step which VNM must take to avoid facing the general decline in the domestic market. In VNM Result Update that Rong Viet Securities published recently, we mentioned that VNM is looking for opportunities to expand sales in markets such as Myanmar and Indonesia through the establishment of Joint venture with local companies. Why did VNM choose these two markets? Is this the right strategy? Traditional products such as condensed milk, powder milk and yoghurt are the main products that VNM is promoting internationally.

Shrimp Sector: the SIMP Program May Affect Exports from Vietnam in Early 2019

Shrimp exports are expected to recover strongly in the rest of 2018 and in 2019 after the announcement of the new tax rate. However, there is still a complicated barrier in the US market for Vietnamese exporters to overcome - the Seafood Import Monitoring Program (SIMP) program, which will come into effect on at the end of December.