Research Center

This quarterly earnings report is a wrapped up note of listed Vietnamese residential developers based on their financial statement. The 4Q22 recorded some anomalies when aggregated NPAT of 27 developers declined by 44% yoy and the loss event transmitted. Since 1Q23F is the off-peak season, we do not think the market could welcome multiple marketing campaigns or a booming 1Q23F business results. About the bond payment, more and more bondholders could declare their inability to pay the due principal/interest in 1Q23F.

On Feb 10, 2023 Novaland held a meeting which gave the audience a walkthrough of the its restricting plan and cash flow. - The company did not hint a glimpse of relief about its due debt payment source but reassures us about its on progress restricting plan. To save money, NVL even procrastinates the interest subsidy program in those current projects and promises to pay back when signing the official contract.

According to the General Department of Customs, Vietnam's textile and garment exports experienced a decrease in growth for the first time in 2022, with a -9.1% yoy decline, totaling USD8.5bn in 4Q22. The textile and garment industry is expected to face significant challenges in 1Q23F due to a decrease in demand for garments and high inventory levels at major foreign retailers such as Nike and Adidas.

The prelim export turnover of Vietnam’s textile and garment dropped 37% yoy and 22.4% mom to USD2.3bn in Jan. The export to the US (the largest textile and garment export market of Vietnam) in Jan fell 46.4% yoy and 21.5% mom to USD992mn. Meanwhile, Vietnam’s fiber and yarn export value slid 52.4% yoy and 30.7% mom to USD226mn in January with China, the largest fiber and yarn importer of Vietnam, recorded USD87mn (-58.5% yoy/-38.9% mom).

SAB recorded a solid revenue of VND10.0tn revenue (+11.4% yoy, +16.1% yoy) due to high demand due to football events such as AFF, World Cup, and the early Lunar new year holiday, and NPAT-MI of VND1.0tn (-20.3% yoy, -22.3 qoq) owing to a sharp increase of selling expenses. For 2022, SAB revenue and NPAT-MI increased by 33% yoy and 42% yoy to VND35.2tn and VND5.2tn, respectively, fulfilling 101%/113% of guidance.

As ENSO is forecast to enter neutral phase in 2023, thermal power is a perfect alternative for shrinking hydropower output. We pick NT2 as our favorite due to expectation of decent results. On 7 Jan, MOIT issued framework for prices of transitional renewable energy projects which are much lower than previous FiT prices.

VNM lost domestic market share in 2022 due to restructuring GM (General Trade vs 85% revenue) and MT (Modern Trade vs 15% revenue). Domestic sell-in dropped yoy owing to distribution channel duplication, while domestic sell-out has increased 3-5% yoy in 2022. Although management viewed a conservative outlook for consumer spending, they expect VNM to get positive sales growth in 2023F.

In 4Q22, Vinh Hoan posted VND2,484bn revenue (-7.8% yoy), which was mainly dragged down by -25.9% yoy and -61.1% yoy decrease of export revenue to US and China. Whilst, Vinh Hoan’s 4Q22 NPAT posted VND199.6bn (-56.7% yoy), plunged by lower gross margin due to the flattening at hefty raw material amid the strong tumble selling price.

The income of Vietnam workers was impacted by still sluggish export activities, thus we expect consumption of beer and dairy will continue to face the challenge in 1Q23F. However, we expect continuously the gross margins of listed dairy and beer companies to improve in 1Q23F due to enjoying cooling raw material prices. For sugar sector, we expect sales could grow up and improve gross margin due to higher selling prices.