Analyst Pin-board STK – 2021 results: Record breaking NPAT
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· In 4Q-FY21, despite declining revenue by 13% YoY, NPAT grew 10% YoY due to tax incentives. · STK released positive 2021 results with revenue of VND 2,042 Bn (or USD 89 Mn, +16% YoY) and NPAT of VND 278 Bn (or USD 12 Mn, +94% YoY), completing 87% and 112% of the guidance, respectively. · In 2022, we forecast revenue and NPAT to reach VND 2,659 (or USD 116 Bn, +30% YoY) and VND 358 Bn (or USD 16 Mn, +29% YoY), respectively. Key catalysts for 2022 earnings growth are: (1) sales volume and selling price will increase significantly due to the recovery of global fashion demand and the anti-dumping tax on China’s polyester filament yarn to help STK regain its market share; (2) the recovery of local garment manufacturers to boost demand for recycled yarn, thereby shifting revenue towards recycled yarn. · We currently maintain our target price of VND 67,000 for STK, implying an expected return of 30% in a one-year investment horizon. |
Century Synthetic Fiber Corporation (STK) is a Vietnam-based company operating in the textile industry. The Company is mainly engaged in the manufacture and commerce of synthetic yarns, with major products as draw textured yarns (DTY) and fully drawn yarns (FDY) made from polyester chips. The Company does not only distribute its products to local textile firms, but also supplied them to overseas clothing companies, such as Nike, Adidas, Uniqlo, Columbus and Guess, among others.
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