HDC – A long way to realizing a land bank potential

Whereas the real estate markets of Hanoi and HCMC witnessed a strong takeoff in 11M2015, the warmth has been felt only recently in many other provinces. Our analyst just met with representatives of Ba Ria – Vung Tau House Development JSC – Hodeco (HSX – HDC) to discuss the potential of the property markets outside of the two major cities. Despite its being the most prominent real estate developer in Ba Ria -Vung Tau, Hodeco has been disfavored by the market for its small cap-size, low liquidity and tepid earnings growth. The stock only captured attention again after the Red River Holdings’ liquidate over 4 million shares of the Company in late November.

FED rate lift-off and the effects for Vietnam exchange rate policy

Today, US Federal Reserves decided to increase the interest rate after a long period of maintaining at approximately 0%. The 25-percentage point adjustment met the expectation from investors. However, such decision has been assessed to be a history turn for US and global economy. Other important aspects after FED’s meeting are the assessments of US economic prospects and the rate adjustment schedule in the future.

DAG – Positive prospect for new plan

Recently, Rongviet Research’s analyst had a meeting with Dong A Plastic JSC (HSX-DAG). Over the last 15 year of operation, DAG is becoming well-known brand for building materials and interior products such as profile bars, aluminum composite panels, plexiglass, uPVC… DAG’s market share achieved 21-25% for profile bars, 7-9% for plexiglass. Even though DAG is a small company compared to HSG, BMP or NTP, DAG still benefits from the positive increase in building material demand. Along with the additional production in profile bars and uPVC, DAG’s prospect in short-term is relatively optimistic. In term of revenue structure, profile bars accounts for the highest proportion, approximately 38% in 2014. At this moment, DAG has 14 production chain in this type with the design capacity at 12,000 tons per annum. With the excess demand in this product type, the Company has invested in new plant in Ha Nam with 27,000 tons of profile bars per annum. Until now, plant construction and central batching system have been completed. Simultaneously, DAG has installed 5/15 of production chains; the remaining 10 will be shipped during 12/2015 in order to meet the demand of 1/2016 production. When new plant operates stably, the design capacity in profile bars could double compared to the current level.

Automotive industry update - Sale volume of 11M exceeded annual plan target

Recently, VAMA just published its November Monthly Report on Automotive Industry. Total sale volume of automotive industry reached 215,597 cars, exceeded 2.77% annual plan target and 30% y-o-y. In particular, passenger cars reached 126,597 cars (+45,1% y-o-y), commercial vehicle achieved 77,880 cars while SUV/MPV/Cross Over reached 11,034 cars (+109% y-o-y).