Research Center

We adjust upward our RNAV-based TP to VND28,200 thanks to RNAV contribution from two new landed property projects including Amerna (Dist 9) and Clarita (in Dist 2) as we have much clearer launching plan. We believe the strong promotion packages offered to homebuyers’ of Amerna and Clarita projects will partially remove the shadow over KDH which has emerged due to the slower demand for real estate.

The bank reported a healthier assets quality as compared to 1Q20 with delinquency ratio of 1.9% (-0.2%p qoq) and NPL ratio of 0.9% (-0.2%p qoq). The NPL of BB segment was up 0.2%p to 0.5% while that of other segments gone down. Restructured COVID-19 loans was VND8.3tn, equaling to 3.6% of total loan book, which seem better than initial estimated size of maximum 7% loan book.

In 2Q20, Vinamilk recorded consolidated revenue of VND15,495bn (+6.1% yoy) and NPAT of VND3,072bn (+6.0% yoy) in 2Q20. Overall, Vinamilk’s 1H20 revenue and NPAT completed 50% and 53% of year targets. In 2H20, although domestic market is recovering to pre-pandemic level, we are concerned that Vinamilk’s growth space will face difficulties from the pandemic impact in export markets, driven by (1) conducted strict measures of Iraq government, and (2) extending school closure in the U.S.

In 2Q20, Vinh Hoan recorded consolidated net revenue of VND1,630bn (-19.5% yoy) and NPAT of VND215bn (-48.7% yoy). In 2H20, we expect the surge of pangasius export volume to EU coupled with revenue acceleration of Collagen & Gelatin will offset the slow recovery of pangasius export to the U.S.. In overall, we estimate Vinh Hoan’s 2020 revenue and 2020 NPAT to record VND7,270bn and VND919bn, respectively.

Restructured COVID-19 loans made up ~2.7% of total loan book (VND~7tn). MBB’s NIM narrowed by 12bps qoq to 4.81% in 2Q20, same move with its peers even though a 3%p qoq enhancing in CASA ratio to 33%. Thanks to improvement in assets quality in 2Q20, we adjust upward 2020F controlling-interest NP to VND7.5tn (-4% yoy) by 7.5% from our latest update.

NTC’s market price has been exploded from year to date as the investors are waiting for land granting decision from Binh Duong People Committee to the company to develop NTU3 industrial park. We believe this event could exist soon as the Vietnam government is eager to approve the new expansion/establishment of industrial properties. However, we think retail investors seem overreacted to underlying land presale surge as the travel restriction could prolong, in our view.

We acknowledge the recent ban on gatherings announced by HCMC authority may hurt sales events hold by real estate developers in coming months. However, we believe Vietnam government has a political will, a full authority and especially a full support from local people to contain the second COVID-19 wave. NLG is among our top favourites as we forecast NLG could achieve its presales targets in late 4Q20F backed by its firm footprint, strong brand recognition to reap the housing demand. The business results in 1H20 was just a blip and the company is waiting for a robust outlook in FY20F-21F, in our view

As we noted in our AGM brieft report dated Jun 23, LHG is worthy for short-term alpha seeking investors betting in industrial property as we are concerned about its medium term contingent liability to Tan Thuan company. However, we downgrade our rating to Hold as we think the potential catalyst and lure dividend yield have priced in the market price. In the medium term, we expect the new lank bank of Long Hau industrial park 3 phase 2 could trigger a surprising business growth FY22-23F.

In 2Q20, Nam Viet recorded revenue of VND884bn (-17% yoy) and NPAT of VND32bn (-79% yoy). We expect Nam Viet’s pangasius export volume to China to lead Nam Viet’s volume growth in 2H20 after this market has fully recovered since June 2020. However, we are concerned that Nam Viet’s revenue will continue to contract and gross margin will improve slowly in 2H20 as we expect pangasius export price to remain low.