Title | HSG_BUY_TP 47,800_Upside +27.8_Flourish season_BSC Company Update_14052021 |
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Report Type | Phân tích công ty |
Source | BSC |
Industry | Basic Materials |
Bussiness | HSG |
Detail |
Date : 11/05/2021 Total pages : 7 Language : English File Type : .PDF FileSize : 971 Kb Download: 175 Download |
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Short Content |
VALUATION BSC raises HSG's target price to VND47,800/share due to (1) an 86% increase in FY2020/21 NPAT forecast after reflecting bullish momentum and HRC price outlook, however (2) lowering target P/E from 9 times to a 10-year average of 7 times to reflect our forecast of a decline in earnings in Q4 FY2020/21 and FY 2021/22 when HRC price corrects after a hot period.
FORECAST OF BUSINESS RESULTS
BSC raised HSG's 2020/21F net sales forecast to 43,668 billion (+58.6% YoY) and NPAT 3,129 billion (+171% YoY), up 29% and 86% respectively compared to the forecast in Latest report. FY2020/21 EPS is estimated at VND6,828/share, fw P/E = 5.5 times.
In FY 2021/22, we forecast HSG's revenue from traditional steel products business to reach VND 38,812 billion (-11.1% YoY), NPAT of VND 2,563 billion (-18.1% YoY), equivalent to EPS = VND 5,483/share.
INVESTMENT THESIS
CATALYST
HRC price increased sharply +25-40% YTD, inventories at the end of Q1/2021 increased accordingly to meet production demand for the peak season.
RISKS
Material price fluctuations, especially when HRC has increased rapidly in recent times.
Increased risks of countries's trade remedies.
COMPANY UPDATE
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