Research Center

SBV has sent document to credit institutions warning on 10 signs of potential risk appeared in the sector in 2020 and asked them to strictly follow Directive 01/CT-NHNN on banking key tasks in 2021. These are official messages for banking operation in 2021 in order to maintain system stability amid unpredictable COVID-19 situation. However, we don’t expect these may tamp down credit growth in coming quarters given favorable interest rate environment and dynamic local economy.

ACB 1Q21 NP came at VND2.5tn, up 62% yoy despite of a skyrocketed in credit provision. This is driven by a 83% yoy advance in PPE. Following effectiveness of Cir.03, ACB expects to book ~VND300bn of extra provision on COVID-19 restructured loans. We lift 2021F NP by 10% to VND12.5tn, up 30.7% yoy and upgrade 12M TP to VND40,100. We expect healthy topline growth of 16-18% is able to offset extra provision and helps ACB to achieve NP growth of 17-30% in coming years.

Long positons captured at 1,280-1,300 pts area and 1,300-1,320 pts area (on Friday session) should be held and close the positions only when there is the closing price below 1,320 pts level (Hourly time frame).

The market sentiment has become optimistic as the high demand on the large-cap stock. However, the downside risk is still intact due to high volatility and the lost consensus of technical indicatora. Therefore, the uptrend may reverse. Traders should be careful and wait for the next signal.

Last week, foreign selling activity surged. Breaking down by sectors, selling activities mainly absorbed by Financials, Materials, and Consumer Staples. Money outflow across Vietnam ticked up, net outflow was USD13mn (a yearly high) due to slow down of money inflow across Fubon FTSE Vietnam ETF and VFMVN Diamond ETF as well as the divestment across X FTSE Vietnam and VFMVN30 ETF.

Per management guidance, FY21F earnings correspond to a forward PE of 9.4x and PB of 1.8x, which seem unwarranted with the local peer median at 14x and 2.1x, respectively. The management note that the actual FY21F earnings could be achieved at 100-130% of the company estimate. Hence, this may be a stock worth watching in the second half of the year when the surprising net profit could be recorded.

Long positons captured at 1,280-1,300 pts area and 1,300-1,320 pts area (on Friday session) should be held and close the positions only when there is the closing price below 1,280 pts level (Hourly time frame).

The downside risks by the COVID-19 epidemic make market sentiment cautious in the short term. Therefore, the uptrend may reverse. Traders should be careful and wait for the next signal.

Based on the long-term uptrend, traders should hold the current positions and buy more on the first pullback (when the 1,200-pts zone is retested).

April provides more evidence for the economic recovery in recent months as major economic indicators improve further. However, we predict the economy to face more challenges in the coming months stemming from an uneven global economic recovery and the new COVID19 resurgence within the country. More prominently, the inflationary pressure is piling up when the upward momentums of construction materials and petroleum products prices see no sign of reverse.