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Total August steel sales volume posted 75,474 tonnes, increasing 35.2% yoy and decreasing 4.3% mom. Steel coat volume made up 88% of the May total sales volume at 66,445 tonnes, +53.9% yoy, -1.8% mom. The coated steel export volume (48,686 tonnes) slightly decreased by 2.7% mom but rose 68.1% yoy.

Total August steel sales volume posted 600,992 tonnes, decreased by 8.7% mom and 15.7% yoy. Construction steel volume decreased to 306,943 tonnes, -20.7% yoy, +17.6% mom. The coated steel sales volume (11,952 tonnes) halved by 58.2% yoy, -62.9% mom. The steel coil sales volume (HRC) was 241,402 tonnes (+3.4% yoy -17.1% mom). In which, export volume returned to 114,165 tonnes in August.

Long-term, fast growth in demand for electricity opens up a lot of opportunities for industries in the power system. Regarding the power generation activity, especially, we highly evaluate the growth potential of the two sources of gas turbiness and wind power in the mid- and long-term based on analyzing the two fundamental characteristics of the power system in terms of (1) stability and (2) economic efficiency. we rate BUY on NT2 (TP: VND29,400, upside: +20%), QTP (VND23,400, upside: +54%), and HOLD on GEG (VND13,000). In addition, we positively value POW's growth potential after 2024, when NT3 and NT4 plants begin commercial operation.

Economic activities accelerated further in 3Q23 mainly thanks to the impressive improvement in export activities and the solid investment from foreign and government sectors. On the upside, it seems the negative impact of external factors on Vietnam's economy has become less severe when the end of the global trajectory of rate hikes was counting down. Export turnover recorded a much softer decline, and FDI disbursement preserved its acceleration. However, domestic consumption continued decelerating due to a slowing recovery in foreign tourism, the lingering hardship of employees in the manufacturing sector, and the limited impact of fiscal measures. For future developments, we expect the export activities to recover and overwhelmingly drive the economy to accelerate in the next quarter.

BHX’s Aug sales soared to VND2.9tn (+3.5% mom, + 20% yoy), which was attributed to higher bill numbers (+4% mom) and fresh volume (+10% mom). TGDD and DMX’ Aug sales continued to decrease to VND6.8tn (+0.0% mom, -13% yoy) but being a slowdown compared to the drop of 25% yoy in June and 20% yoy in July, which was driven by the positive yoy growth of laptops and white products.

On Sep 19, we attend Ho Chi Minh City Infrastructure Investment (CII) Extraordinary General Meeting. The company presented to the investors their plan to amend the company business line and to develop new infrastructure projects. The company failed to organize the meeting due to only ~200 investors attended, represent 31.2% of the voting shares.

The S&P Global Vietnam Manufacturing Purchasing Managers' Index (PMI) rose to 50.5 in August 2023 from 48.7 in the prior month. This was the first increase in factory activity since February, as output, new orders, and foreign sales all returned to expansion. Overall, the PMI's return to growth in August is a welcome development for the Vietnamese economy. It suggests that the manufacturing sector is recovering and is well-positioned to contribute to the country's economic growth in the coming months.

We expect the stock market to maintain its uptrend with a target range of 1,260 to 1,340 points for late 2023 thanks to macro factors such as (1) Improvement in Foreign Direct Investment and (2) The easy money policy.

VCG’s revenue doubled by +108% yoy, 132.4% qoq (VND4.5tn), and NPAT skyrocketed to VND130.3bn (+592% qoq) compared to 2Q22 loss of VND60.3bn. The real estate accounting for 25% of revenue in 1H23 posted a GM of 29% (+9%p yoy) than the construction division (60% of total revenue, GM: 2.1%, -3.3%p yoy). The Company's interest expense in 1H23 was VND430.9bn, +11% yoy. The revenue growth pushing up the interest coverage to 5x in 2Q23 from 3.3x in 2Q22

Despite a flattish 2Q23 revenue growth of -4.5%yoy (VND39.3tn), earnings growth rattled by 42.1% yoy due to the interest burden coupled with an unfavorable comparison base. Gross profit reduced to VND4.6tn (-17.1%yoy). Costly material thinned industry gross margins, particularly for residential contractors. In contrast, infrastructure builders with BOT projects sustained healthier gross margins. Contractors were weighted by surging interest expense including C4G (+95 % yoy interest expense growth in 2Q23), PC1 (+59% yoy), TCD (+67% yoy).