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PNJ – MONITOR reccomendation in all reciprocal tariff scenarios

• We propose three baseline scenarios to provide a relatively comprehensive view of PNJ’s business outlook in light of Vietnam’s macroeconomic landscape, particularly under the condition of the reciprocal tariffs that the US imposes on Vietnam exported goods. These three scenarios correspond to different tariff levels and are accompanied by a sensitivity table that illustrates PNJ’s valuation under each scenario:
o Best scenario: 10% reciprocal tariff. In this case, jewellery consumption growth is expected to remain largely unaffected, averaging 4.1% annually between 2025 and 2029. Under this scenario, we maintain our previous forecasts, although we acknowledge that this projection leans toward the optimistic end relative to what may actually unfold.
o Worst scenario: 46% reciprocal tariff. As jewellery is a discretionary item, we anticipate that the decline in jewellery consumption growth will exceed the general slowdown in retail sales. Despite that, we assume an average annual contraction of 2% in jewelry demand.
o Base case scenario: Tariff level falls between the two above. We have not conducted a detailed forecast for the base case.
• We recommend that investors continue to closely MONITOR PNJ stock under any of these tariff scenarios. Nonetheless, we also recognize that in the short term, PNJ’s share price may be driven more by market sentiment and global macroeconomic developments than by fundamentals. As a result, its market valuation may not accurately reflect its intrinsic value.