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ACB - Promising outlook for recovery

• The bank has presented a relatively cautious plan for 2024 at its annual General Meeting of Shareholders (AGM). Total assets are expected to grow by 12%, reaching approximately VND 805,050 bn (USD 32,857 mn). It is important to note that the 14% credit growth target in the plan represents the limit allocated for the entire year for ACB. Additionally, we anticipate that ACB may be granted additional credit limits by the end of the year based on evaluations by the State Bank of Vietnam
• Preliminary net profit before tax (PBT) for Q1/2024 amounted to VND 4,900 bn (USD 200 mn), a decrease of 5% year-on-year (YoY), achieving 22.27% of the 2024 plan. The decline in Q1 PBT was mainly influenced by non-interest income sources, particularly bancassurance fees, and high collection in Q1/2023. Meanwhile, based on the bank's disclosed PBT level, we estimate that net interest income will grow by approximately 12.6% YoY to VND 7,000 bn when credit growth reaches 3.7% year-to-date (YTD) and the net interest margin (NIM) increases by 20 basis points (bps) 
• Our forecast for 2024’s PBT is VND 23,059 bn (USD 942 mn), marking a 15% YoY increase and a 4.8% increase compared to the bank's plan. Earnings per share (EPS) and book value per share (BVPS) stand at VND 4,710 and VND 22,000, respectively. Our latest target price is VND 32,300 per share, combined with a dividend of VND 1,000 per share, equivalent to a return of 22% compared to the closing price on April 5, 2024. Therefore, we recommend a BUY for ACB