Research Center

ACB 1Q20 results confirms the bank’s strength in retail banking market. NP came at VND1,537bn, up 13% yoy. Loans grew 2.3% ytd with low NPL ratio of 0.65%. Deposit was in the spotlight, up 2.0% ytd as of March 2020 vs. 0.51% of the whole industry (as of 20 Mar 2020). We maintain BUY with a TP of VND28,900. ACB is our sector top pick thanks to its healthy balance sheet and prudent credit policy which allow it go through pandemic circumstance with credit cost of below 1% in 2020.

We retain our Add rating with a TP of VND29,200 based on 30-50% discount to mega project’s RNAV. Presales at Waterpoint is now critical for the share price performance because of their significant RNAV contributions to our valuation. Risks to our call: 1) a prolonged COVID-19 that curbing buyer purchasing power for its mid-range condos 2) regulatory changes causing more project delays.

We expect Ha Tien 1’s performance will strongly rebound in 2021. Together with the ability to improve ASP amid weak domestic market, strong cash flow due to low CAPEX and interest expenses are 2 big plus. Using the PE of 9.0, we evaluate the HT1 share at VND16,400 by the end of 2021. Including the VND1,200 cash dividend per share, total expected annualized return for 2 year holding period is 22.1% at the current market price of VND12,900. Recommend BUY

VCB 1Q20 NP was down 11% yoy on the swell of credit provision and OPEX. Overdue ratio increased to 1.5% from 1.1% at end-2019. However, these were sheltered by excessive credit loss reserves of 235%. We give a HOLD on VCB.

The country credit growth soared to 1.1% ytd as of end of 1Q20 from 0.68% on 20 March amid sluggish economy, which would mainly result from banks’ stimulus packages and restructured loans on virus-impacted debtors. Nevertheless, VPB revealed to maintain positive growth trajectory compared to the same period last year as the COVID-19 pandemic had yet impacted the bank’s 1Q20 performance.

On 20 Apr, we joined an analyst meeting with Vinh Hoan’s management board to update about its business situation. Consistent with our view, Vinh Hoan recorded the decrease in revenue (-9% yoy) and net income (-51% yoy) in 1Q20 due to undermining pangasius demand in China amid COVID-19 outbreak and export price plunge. Meanwhile, in the high case of 2020 business guidance, management board expects better business results than 2019 as net revenue can increase 9.3% yoy and net income can decrease 9.8% yoy in 2020.

We estimate Vinh Hoan will record revenue of VND1,537bn (-14.1% yoy) and net profit of VND137bn (-55.5% yoy), because of low export price and contracting gross margin compared to the high base of 1Q19. However, Vinh Hoan's gross margin may improve 1.3%p qoq thanks to (1) favourable farming expenses as Tan Hung farm came into operation and (2) stable outsourcing material price.

KDH market price has been plunged by -26.6% YTD, providing undemanding valuation. We believe the current price could flip when KDH releases its 1Q20F positive results with a 46.8% yoy net profit increase in the fourth week of April, together with a VND500bn share-buy-back plan announced on 26 Mar. Total return is 28.1% (incl. 2.5% dividend yield) in 1 year, thus we maintain BUY with KDH

Masan Group estimates Masan Meat Life’s revenue to grow 20% yoy in 2020, thanks to sales acceleration of MEATDeli pork, of which 1Q20 revenue is expected at USD10-15mn. VinCommerce’s EBITDA margin is estimated to have enhanced to -6% in 1Q20 and to maintain its improvement trend in next two quarters. Masan Consumer Holding expects convenience food to beat its previous estimate in 1Q20.