PNJ - Optimistic 2016 prospects thanks to the jewelry business and the significant decrease in financial burden

In 2015, core business of PNJ saw probable growth. Revenue of parent company recorded VND7,690 billion (+6.72% y-o-y). Gross margin improved sharply 387 percentage points from 10.98% of FY2014.  The gold jewelry segment accounted for the largest share, which was 80% of the revenue and 88% of the gross profit. In 2015, PNJ opened and upgraded 48 stores in 25 provinces and cities, exceeding 37% annual plan. The expansion and growth strategy helped PNJ’s market share increase significantly from 21% in 2014 to 25% in 2015. However, large financial reserve for investments in Dong A Commercial Bank (VND311 billion) and Dong A Real Estate JSC (VND30 billion) has inflated the financial expenses 4.5x compared to those in FY2014; therefore, the bottom line considerably drop 37.8% y-o-y.

Fertilizer companies: El Nino and industrial prospects

Market is entering AGM season. Prior to official AGMs of listed fertilizer companies, RongViet Research has schemed through AGM documents of several companies to have a quick view on this industry in 2016.

LHG – Faster and bolder

The stock of Long Hau JSC (HSX – LHG) has been one of the best performing securities since mid-March, gaining nearly 30% in the past two weeks. In the 2015 AGM held on Monday, LHG revealed the business plan for 2016 and the five-year period to 2020 along with a detailed plan for the development of Long Hau 3 Industrial Park and the initiative to spin off its service business.

Seaports – Opportunities from short-term corrections

Retrospectively, most listed port operators in Hai Phong achieved “spectacular” results in FY2015. On specifics, revenue and PAT recorded annual growth of ~15% and impressively 34% compared to 2014. Those achievements were attributed to: (1) 19%yoy rise in containerized cargo passing through Hai Phong, (2) abnormal increase in refrigerated container numbers (food mainly) and (3) longer than expected storage duration for refrigerated goods at ports, due to Vietnam-China border trade halt in mid-2015, made this services revenue (having high GPM) to hike. In addition, the higher and more even allocation of goods between last year’s quarters greatly supported ports’ earnings results and its following stock prices. In fact, share price of listed ports such as VSC, DVP, DXP and HAH did gain 20% on average in 2015.

STK - Positive 2016's business result

The downtrend in prices of commodities such as cotton and oil leding to a sharp decline in fibre prices had caused negative impact on earnings of many fibre companies, including Century Synthetic Fiber Corporation (HSX - STK). The volume of fibre Yarn production was only 26 885 tons consumption, reduced ~ 18.7% compared to 2014. With the average selling price dropped 12% fiber, revenues have plummeted ~ 29% and profit after tax reached only 71.3 billion, equivalent to EPS of 1,537 dong/share.

Weak growth of the agricultural sector could drag down 2016 GDP growth

GDP growth reached only 5.46 % Q12016, it might be bad news for many investors. This result comes from a slowing down in the growth of industrial production sector, while the agricultural sector is facing constraints due to unfavorable weather conditions. While overall GDP growth was not as expected, the highlight of the economy in the first quarter lies in the improvement of the construction and retail activities. Besides, the stability of the financial sector and the positive foreign inflows are plus-points in Q12016.

VNR updates – 2016 plan in line with reinsurance market

VNR experienced negative growth in EAT in 2015. Reinsurance fee was reported at VND1,617 billion (+6.9% yoy). EBT was VND291 billion (-30% yoy), whereas earnings from reinsurance segment dropped 35.8% as reduction in claim reserve released. Investment income also reduced by 31% yoy as VNR booked an abnormal profit from Samsung Vina divestment as well as interest rate in 2015 was a little bit lower than that of 2014.

PGI updates - business restructuring has yet brought any changes

PGI has the second year in a row having positive earning from insurance business (+9.7% yoy). Investment income was quite stable with slight increase 5.7% yoy. PGI reported an EAT of VND93.1 billion (+5.5% yoy).

REE – Unaffected long-term prospect

REECorp (HSX – REE) just posted its 2015 Annual Report and AGM documents, including guidance of 2016 business results and dividend payments. For FY2016, the Company targets an annual growth rate of 11% for revenue and 22.8% for net income. REE will pay VND1,000/share of cash (1Q2016) and 15% of stock dividends (2Q2016) from 2015’s net profit and plans to pay no less than VND1,200/share in either stock or cash for 2016.

NLG’s shareholders approve convertible bond issuance

Nam Long Investment Corporation (HSX – NLG) just announced a shareholder resolution on convertible bond issuance and a BoD resolution on the Company signing into a contract with ASPL – PLB Co. Ltd. for the development of the Casa project.

HAX – 2016 outlook would be affected by change in special tax rate policy

Recently, our analyst had a company visit with the representative from Hang Xanh Motors Service Joint Stock JSC (HOSE –HAX). By the chance, we would like to update the newest information to HAX regarding 2015 earning result as well as 2016 outlook. HAX operates in two main business which are (1) Automobile retail for Mercedes cars, (2) Automobile services (repairs, maintenance, ...).

CMG - Turning into a new growth phase

CMG-a listed company in technology sector. In this sector, investors are concentrating their trading on four tickers: CMG, ELC, FPT and ITD. In which, CMG has four main business segments (telecommunication, Integrated system (IS), Software and Distribution), which are quite similar to FPT’s but at smaller scale.