Title | VHC_NEUTRAL_TP 39,000 VND_Upside 6%_The worst time has passed_BSC Company Update |
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Report Type | Phân tích công ty |
Source | BSC |
Bussiness | VHC |
Detail |
Date : 31/08/2020 Total pages : 13 Language : English File Type : .PDF FileSize : 1271 Kb Download: 485 Download |
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Short Content |
Valuation We maintain our NEUTRAL recommendation for VHC stock with latest target price of 39,000 VND per share (+ 6% upside) as we upgrade P/E multiple from 5.5 to 6.5 based on these following assumptions (i) expectation for recovery in the second half of 2020 (+ 28% YoY) (ii) high growth in 2021 from low level of 2020 (EPS 2021 fw – 7,067, PE fw 2021 =4.7) Business forecast
In 2020, BSC expect VHC to post a respective VND 8,544bn (+8.6% YoY) and VND 951bn (-19.4% YoY) which is equivalent to a growth rate of +28% YoY in the second half of this year. EPS 2020 reaches VND 5.169 per share, P/E fw 2020 reaches 7.1.
Investment themes
Expectation for impressive recovery in the second half of this year
Growth from new Collagen and Gelatin production line, supporting a more sustainable business model
Risks
Potential upsticks in corona virus cases in major exporting markets
Delay of new Collagen and Geltain production line
Company Business Result Update
The first half of FY 2020 suffered a significant drop in earning due to (i) high base result in FY 2019 (ii) exporting value slumped during corona virus lockdown. Net sales totaled VND 3,266bn (-14.3% YoY) and NPAT posted VND 368bn (-49.5% YoY)
Exporting value to major markets maintain our previous forecast: USA market revenue swung to a strong decline of 462% QoQ while Chinese market strongly bounce back by a growth rate of 285% QoQ.
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