Analyst Pin-board NVL Q1-2021 AM Note
- 1Q 2021 performance: Skyrocketing revenue and NPAT results with triple digit growth backed by the handover of 709 units mainly in Saigon Royal, Aqua City, Novahills Mui Ne, Novaworld Phan Thiet, Sunrise City View.
- 2021 Outlook: Management expects to achieve revenue of VND 27,678 Bn (+451% YoY) and NPAT of VND 4,106 Bn (+6% YoY) in 2021 from the handover of both HCMC and satellite regions (50/50 revenue contribution). The possible divestment/revaluation is not factored yet on the aforementioned profit plan. After completing a buying back it issued convertible bonds (“CBs”) in 2018 (value at USD 240 Mn), NVL is working with advisors to issue CBs with a value of more than USD 240 Mn (estimated amount at ~USD 300 Mn, finalized amount will be public in June 2021).
- From our point of view, 2021- 2024 should be a strong profit year. The catalysts include (1) Strong pre-sale and handover of three hospitality projects in satellite regions, (2) Less strict legal issues given the effectiveness of several laws/decrees from 2021 to accelerate profit recognition in HCMC projects, (3) Ramp-up progress of nearby public infrastructures to support NVL’s projects price and absorption rate. We have an OBSERVE suggestion on this stock as the price has partly reflected the (1) Solid Q1 2021 pre-sale and delivery performance, (2) Buy back news of its CBs issued in 2018. The next expectation would come from the progress of its new CBs issuance and revenue recognition of HCMC projects along with the sale performance of hospitality projects.
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