PXS – No Improvements Ahead in 2017

Rong Viet Research had a meeting with the representative of Petroleum Equipment Assembly & Metal Structure JSC (PXS – HSX) this week. During 2016, PXS’s revenue and profit before tax was VND1,550 billion (-11.2% yoy) and VND110 billion (-22.0% yoy) respectively. PXS was only able to achieve ~75% of its plan for the year, and it’s still expected to maintain a 13% cash dividend.

PNJ- Updates On its Business Results

Phu Nhuan Jewelry JSC HSX: PNJ), one of our favorite stocks, has released its preliminary earnings results for FY2016. Its revenue for 2016 was around VND8,720 billion, an increase of 2% over the year before. Retail revenue remained positive, with a growth rate of 29%; same-store sales growth was 8-9% and the contribution of new stores to revenue was ~12%. PNJ’s gross profit margin advanced by 0.63% compared to 2015.  Earnings before tax was around VND608 billion, climbing by 204% YoY. Excluding extraordinary items, PNJ’s EBT was 23% higher over the year 2015.

Vietjet Air - Too Many Planes?

Vietjet Air has delivered remarkable growth since is foundation. Beginning with just a single plane in 2011, the company has now grown to operate 42 aircrafts in 2016, and this number is estimated to reach 78 in 2019. What is more, the airline’s fleet will significantly expand with the arrival of 24 Boeing 737-Max200 planes each year from 2020 to 2023. This raises the question of whether Vietjet can make use of the new aircrafts efficiently.

Stock Market and Banking Liquidity in 2017

Many investors have become concerned with the banking system liquidity this year. The apparent reason is that the domestic monetary flow was on an upward trend during 2016, thanks to the SBV’s strong easing monetary policies; this has resulted in a strong boost for the market.  Will this story repeat in 2017? We will discuss the risk and opportunities from the monetary flow perspective in today’s analyst pinboard.

Updates for Newly Listed Fortex

Investors paid more attention to the textile industry because of the appearance of Vinatex (VGT). The industry is expected to welcome another “big guy”, as Fortex plans to list on HSX on January 18, 2017 with the reference price of 18,000 dong/share. This article is going to provide some useful information regarding to the company’s operation.

Oil & Gas – Exploitation in 2016

Oil prices reached a trough during Q1, dropping to 27 USD/barrel, which was the lowest point in the past 10 years. However, oil prices soon recovered after this and have been stable at slightly over USD55/barrel during the end of this year. For the whole year, brent oil prices averaged at USD45/barrel. Under this circumstance, Vietnam’s oil & gas industry also received significantly negative impacts, especially for leading companies such as PVN.

Commodity Recovery in 2016 and Wildcards During 2017

After experiencing a sharp plunge in 2015, commodities prices in general have experienced a significant recovery in 2016 following a 5-year bear market. Among the gainers, iron ore, zinc and natural gas were the year’s best performers. It is believed that the rally may extend over the next few years supported by supply and demand dynamics as producers across the complex have scaled back supply since most commodities have been trading below their marginal cost of production.  The rally could also occur for an extended period causing world-wide producers to reduce output and cut investments in future projects.

Vietnam’s Airport Sector – Limitations and Opportunities

Airports Corporation of Vietnam (ACV-Upcom) operates 22 commercial airports in Vietnam. The firm recorded nearly 81 million passengers in 2016 making it one of largest Asian airports by annual passenger volume. Vietnam’s aviation and airport industry growth prospect is well supported by (1) the rise of Vietnamese middle class income (believed to make up half the Vietnamese population in 5 years’ time – Nielson), (2) “flying costs” becoming more affordable and (3) time saving.

Significant Changes in Tax Policies for the Fertilizer Industry

The fertilizer industry struggled during 2016 due to unfavourable conditions such as decreasing demand, rising competition and unfavourable tax policies. However, some significant changes in tax policies will result in pros and cons for the fertilizer industry during 2017. Below is a brief assessment of tax policies which will affect the fertilizer industry in 2017.

HSG’s FY16-17 AGM: Core Business Remains Solid

HSG has been setting up a number of production lines, which will raise its capacity by 28% in 2016-2017FY and will enable HSG to achieve its targeted volume growth of 20%.

ITD – Quick Update

ITD has solid experience in providing technology solutions for the transportation sector, especially intelligent transportation systems (ITS), namely automatic toll collectors. Even though it has been operating in this area for 10 years, the ITS segment has increasingly contributed to the company’s business results thanks to the development of transport infrastructure. Rong Viet Research believes that growth dynamics from this development will continue to be a foundation for ITD’s long term prospects.

2017 Domestic Steel Price: A Stronger Bounce is Ahead

The global steel industry witnessed a supply shock in 2016, resulting from China’s policies to control steel production. With the aim of wiping out small-scale and inefficient steel mills to reform the industry, China has put a cap on coking coal mines’ production days.  This has resulted in commodity prices surging by 247% during 6 months, reaching the peak of nearly USD309 per ton in November 2016. Consequently, scrap and iron ore prices rose by 67% and 85% YoY respectively.