TCB – 4Q21 earnings review: beating expectations slightly
27-01-2022
27-01-2022: TCB
:
: Thanh Nguyen Ngoc
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- 4Q21 earnings modestly beat our forecasts by 4% (VND 6.1 trillion versus VND 5.9 trillion in PBT) mainly due to robust NIM and strong NFI growth. As a result, TCB reported 2021 PBT at VND 23,238 bn (USD 1.0 bn, 47% YoY), exceeding our prior estimates of VND 23,010 bn).
- The extensive growth in 4Q21 and the whole year results came from high credit growth quota, NIM expansion, the rise of bancassurance, settlement and securities segments. Asset quality has been well maintained during the year in spite of the pandemic impact, leading to controlled credit costs and thereby, the resiliency of operation efficiency.
- We currently have a forward 2022 PBT forecast of VND 29,357 bn (USD 1.3 bn, 26% YoY). The 2022 book value per share is projected at VND 32,746. We are revising the forecasts and currently have a target price of VND 71,000/share and a BUY This translates to an upside of 39% from the closing price of January 27, 2022.
23 STK – 2021 results: Record breaking NPAT
26-01-2022
: STK
:
: Loan Nguyen
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- In 4Q-FY21, despite declining revenue by 13% YoY, NPAT grew 10% YoY due to tax incentives.
- STK released positive 2021 results with revenue of VND 2,042 Bn (or USD 89 Mn, +16% YoY) and NPAT of VND 278 Bn (or USD 12 Mn, +94% YoY), completing 87% and 112% of the guidance, respectively.
- In 2022, we forecast revenue and NPAT to reach VND 2,659 (or USD 116 Bn, +30% YoY) and VND 358 Bn (or USD 16 Mn, +29% YoY), respectively. Key catalysts for 2022 earnings growth are: (1) sales volume and selling price will increase significantly due to the recovery of global fashion demand and the anti-dumping tax on China’s polyester filament yarn to help STK regain its market share; (2) the recovery of local garment manufacturers to boost demand for recycled yarn, thereby shifting revenue towards recycled yarn.
- We currently maintain our target price of VND 67,000 for STK, implying an expected return of 30% in a one-year investment horizon.
PET – Setting a high sales target for Apple products while potentially expanding brand portfolio with Xiaomi in 2022
25-01-2022
: PET
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: Tung Do
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A look at food prices through the futures market
25-01-2022
:
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: Bernard Lapointe
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- Food prices are up since December
- In real terms, global food prices are at their highest level since 1975
- The end is not in sight.
HND – Earnings doubled the 2021’s guideline
24-01-2022
: HND
: Utilities
: Nguyen Ngoc Thao
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- In 4Q2021, revenue was VND 2,218 bn (or USD 96 mn), +1% QoQ and -9% YoY. Revenue declined YoY even though volume increased. Average selling price in 4Q2021 was higher than other quarters during the year thanks to FX revenue.
- 2021 was a hydrologically unfavorable year for thermal plants: accumulated revenue was VND 9,026 bn (or USD 392 mn), -17% YoY, while NPAT reached VND 443 bn (or USD 19 mn), -70% YoY. That said, these results were still ahead of our expectations as the draught came sooner than expected in 3Q2021. Thus, 2021 earnings doubled full-year guidance.
- We reiterate our BUY recommendation on HND with a TP of VND 23,300. Plus a cash dividend of VND 400, total implied return in the next 12 months is 26% as of Jan 24th, 2022.
DRC – NPAT to accelerate in 2022
21-01-2022
: DRC
: Automobiles
: Toan Dao
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VHC – 2022 earnings to continue growing
20-01-2022
: VHC
: Fishery
: Loan Nguyen
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- We maintain our target price of VND 75,000/share, implying an expected return of 25% including a 3% cash dividend yield for a one-year horizon. We recommend BUYING this stock.
- VHC released 2021 consolidated revenue of VND 9,067 Bn (or USD 394 Mn, +29% YoY), in line with our forecast. We are optimistic that 4Q 2021 NPAT will see a strong increase due to high fillet selling prices on the back of a low 4Q 2020
- For FY22, we project revenue and NPAT to reach VND 10,287 Bn (or USD 447 Mn, +13% YoY) and VND 1,177 Bn (or USD 51 Mn, +21% YoY), respectively. The 2022 EPS will be VND 6,369 and 2022 forward PER 11.8x at our target price. We think this PER is reasonable for VHC due to its long-term earnings growth to improve and less volatile compared to the past.
MBB – 2022 Outlook: Healthy Asset Quality Supports Growth
19-01-2022
: MBB
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: Tam Pham
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- Healthy asset quality will be consolidated following customer recovery, combined with high provision base and full provision for structured debt in 2021, leading to reduced credit costs significantly in 2022, which is an important growth driver of PBT in 2022.
- Q4/2021 results are expected to rise strongly compared to the same time last year, thanks to strong improvement in NIM. High profit growth in 2022 will start from Q2. Q1/2021 creates a high-comparison base with a spike in one-time income from written-off debt collection.
- We estimate PBT for 2021-2022 to reach VND16,297 billion (+52% YoY) and VND22,443 billion (+38% YoY). Book value per share in 2021-2022 is VND16,080 and VND20,773 respectively, corresponding to forward P/Bs of 1.7x and 1.3x. The target price is VND38,500/share, corresponding to a BUY recommendation with a profit margin of 28% compared to the closing price on January 18, 2022.
The Government's priorities in the economic recovery program 2022-23
18-01-2022
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: Macroeconomics
: Ha My
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- The National Assembly approved the stimulus package worth about 4.1% GDP.
- Supporting the demand side is a key part of the economic recovery program.
- The public investment serves as leverage for Vietnam in recovery after the pandemic.
- The majority of the out-of-budget spending package aims to import Covid-19 vaccines.
HAH – Solid Container Vessels Operations to Drive 2021 Results
17-01-2022
: HAH
: Logistics
: Thu Anh Tran
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- Preliminary revenue and net profit for 2021, per management, was respectively estimated VND 1,976 Bn (+ 66% YoY) and VND 440 Bn (+ 219% YoY), ahead of our expectations by 8% and 19%. We attributed the positive business results mainly to solid container vessels operation, which was strongly supported by favorable charter rates and higher domestic freight rates.
- HAH will expand its container fleet by purchasing used vessels and order new-built vessels as well. Notably, the plan was approved for purchasing old vessel named Marine Bia from Fresh South Shipping S.A, which will be handed over in April 2022, followed by a five-month period of chartering and domestic transportation use from September 2022.
- The chartering segment will be the key profit growth driver for 2022F. With long term chartering contracts for 1-2 years and high charter rates, we expect chartering revenue to jump by 175% to VND 623 Bn in 2022F, accounting for 26% of total revenue (vs 12% in 2021E). We project that higher contribution from this high profit margin operation should improve gross margin by 8.3 pps to 45.2% in 2022F. Meanwhile, shortage in domestic transportation capacity supply continues to cement shipping segment in 2022F.
- We expect revenue/NPAT-MI to be VND 2,410 Bn (+ 22% YoY)/VND 696 Bn (+ 58% YoY) in 2022F. EPS for 2021/22F will stay at VND 8,397 (+ 196% YoY)/VND 13,273 (+ 58% YoY).
- Using a P/E multiple of 9x and FCFE with equal weight, we come up with a fair value of VND 89,500 per share, equivalent to return of 51% as of the closing price on January 17th, 2022. Thereby, we
Banking sector – Improved circulation as a driver
14-01-2022
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: Thanh Nguyen Ngoc
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- Credit growth for 2021 met our expectations as demand recovered during the end of the year and the SBV granted more quotas. Deposit growth however missed out on our predictions due to weak retail deposits. We consider ramping up economic activities as a pivotal driver to higher credit and deposit growth in 2022.
- The recent adjustment in quoted deposit rates at several commercial banks is expected to not signal a trend but is due to seasonal factors. We look forward to deposit rates being stable in the first half of 2022. Liquidity constraints caused by the continuously widening gap between credit and deposit growth and regulatory liquidity ratios might lead to upward pressure on rates in the second half.
- The outlook for the banking sector in 2022 continues to improve on the basis of the expansionary monetary policy, the recovery of the economy and improved perceived risks, while the pressure to raise interest rates is expected to arise only at the end of 2022 and will be polarized among banks. We expect the state-owned banks’s performance to be supported by stories such as dividends and private placement to foreign investors expectations in 1Q22, while the private banks are timed to have positive news and pose outstanding growth from 2Q-3Q/22.
MWG – Entering new potential markets
13-01-2022
: MWG
: Retailing
: Tung Do
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- MWG rolled out five new retail chains on Jan 10th, 2022, namely AVASport, AVAFashion, AVACycle, AVAKids, AVAJi, respectively selling sportswear, clothes, bikes, mom & kids items, and jewelry. Initial results were encouraging with revenue posting USD 1mn after three days.
- Though these new chains are still in the pilot phase, we see interesting upside potential for MWG as the company, a seasoned retailer with top-notch execution, is entering new fragmented markets with most of them are not having clear market leaders.
- In this site visit tour, CEO Doan Van Hieu Em shared new the development plans for TGDD and DMX chains as well, with a rollout of 200 Topzone stores (vs previous plan of 50 stores) and the new supercenter format for DMX in 2022. Both of which are targeting middle to affluent customers, whose income is less negatively impacted post-pandemic.
- The current TP of VND 163,500, equivalent to a 2022F P/E of 14.4x, is under review.
