Updates on HSG

H1 2017-2018 result lowered. Net revenues and NPAT-MI are reported at VND 15,549 billion (+29.8% yoy) and VND 420 billion (-50.9% yoy), respectively. A significant increase in COGS along with operating and interest expenses weakened the bottom line. In particular, COGS increased 36.4% compared to a 29.8% growth in revenues. Selling, administration and financial expenses jumped 33.2%, 44.8% and 99.7%, respectively. Q2 performance fell heavily as NPAT-MI decreased 79%, at VND 86 billion. However, revenues rose 23% to VND 7,663 billion. According to HSG, the difference came from lower-cost inventory in Q2 2016-2017 when HRC price were favorable. The HRC price has been increasing since the beginning of 2018, yet gross margin and net profit margin have shrunk to 14% and 3%, respectively.

Vietnam Pharma Retail Market Overview

Mom-and-pop stores dominate the pharma retail market in Vietnam. There is 57,000 pharmacies and drug stores around the country. Pharmacy chains account for less than 1% of total stores.

Q2 2018 ETFs: Forecast on Changes

2 foreign ETFs will reconstitute their portfolios in June.

Updates on VGC

The Ministry of Construction (MoC) divestment from Viglacera.

Currently MoC’s stake in Viglecera is 54%. As planned, the Ministry is expected to sell about 80,579,262 shares (corresponding to an 18% stake) in Q2 2018 and accordingly lower its ownership to 36%. The offer is open to all stakeholders, including individual and institutional investors. The divestment progress is reported to be as followed:

MPC – Q1/2018 Business Results Update

At the end of Q1/2018, MPC recorded a 139% increase in EPS compared to the same period last year.

MSN – Update on the Business Performance of Masan

For 2018, Masan Group set a possitive revenue target of VND 47,000 Bn (+25% yoy) and an after-tax profit after minority interest of VND 4,000 Bn (+29% yoy).

FPT’s 4M2018 Business Results: Profitability Improved as Expected

FPT has released its estimated 4M2018 business results, showing an improvement in both profit and profitability compared to the same period last year. Similar to our expectations, divesting from the retailing and trading business makes ways for FPT to concentrate on technology and telecom in order to boost the overall profitability. Compared to the same period last year, FPT recorded 21% growth in net income despite a 50% decrease in revenue because of the divestments.

Oil prices

It is time, in our view, for many Asian countries to limit their dependence on fossil fuel. China and Japan are doing that, others should follow.

Our target price for end-2018 (WTI) is around $80/ bbl.

Vietnam Ecommerce's Landscape

Vietnam ecommerce market is forecasted to have CAGR of more than 33% in the period 2017-2022. Smartphone users account for 84% of Vietnam’s population (96 millions) along with an internet penetration rate of over 50%. This is the sweet spot for both onshore and offshore retailers.

NCS - Update on Initial Coverage Released of NoiBai Catering Services

Noi Bai Catering Services JSC (NCS – UPCOM) is a leading player in flight catering and related services at NoiBai international airport. Due to its monopoly status in providing catering service for Vietnam Airlines, as well as its extensive experience in the catering services industry, its business activities have been growing up over the years. 

POW – Update on 4M 2018 Business Performance

After the turnaround in 2017 business results, POW’s performance in the first 4 months of 2018 continues to show significant improvements with even more catalysts to come in 2018 - 2019.

CSM – Earnings Target Is Hard to Reach

For the financial year 2018, CSM plans to record revenues of VND 3.8 Tn (+7% YoY) and NPBT of VND 105.3 Bn (+53%). Although the top-line target is reasonable, we do not agree with them about the bottom line.