Result Update Report: DRC - Raw material costs reduction is the key
Combining FCFF (50%) and multiples comparison (PER) (50%), our target price for DRC is VND20,300 which is -9% lower than the closing price on Jun 02nd 2023. However, DRC maintains a stable dividend policy, with an average payout ratio in the last five years of ~64%. For the next 12 months, the expected dividend is VND 1,400/share, equivalent to a dividend yield of 6%.
We believe that DRC is a suitable investment under the “dividend investment strategy”. With the concerns that unfavorable business conditions may negatively affect DRC's business results in the next few quarters, we suggest that investors following the arbitrage strategy can watch DRC shares in the short term. Investors who prefer stable dividends can flexibly disburse when the cash dividend yield is attractive more than the bank deposits.
Danang Rubber Joint Stock Company is a Vietnam-based company engaged in the rubber processing sector. It manufactures, trades, imports and exports rubber tires, inner tubes and other deprived products for automobiles, motorbikes and bicycles. It also manufactures other rubber products for mechanical uses, as well as trades materials and supplies for the rubber industry. The Company is involved in the offering of installation services of machinery and equipment for rubber processing activities.
Viet Dragon Securities belongs to top 20 biggest securities companies in terms of chartered capital in Vietnam. With a qualified, dedicated and professional team, a widespread network, advanced technology, diversified products and services, and good relationship with local and foreign institutions, we provide a wide range of services and products to our clients both individuals and institutions, both local and foreign. We commit to provide our clients with promising investment opportunities and a comprehensive and professional financial investment services.
RongViet Research reports are diversified and abundant, along with in-depth analysis and performed by experienced, highly-qualified and knowledgeable teams. With the objectives of transparency, accurate and timely manner, RongViet believes that our products would always be important sources of information for customers/investors’ investment decisions.”
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.