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DPR - Rubber segment in 2H2025 declined, offset by liquidation of trees

Q1-FY25: Robust rubber prices have fuelled stronger-than-expected earnings
• Revenue reached VND 203bn (+9% YoY), driven by a 41% YoY surge in ASP to VND 57.8mn/ton, with stable sales volume.
• The tree liquidation segment contributed nearly 50 bn VND, equivalent to 50% of the 360-hectare plan, supporting high profit margins.
• Gross profit reached VND 96 bn (-46% QoQ, +17% YoY), thanks to improved rubber selling prices (+4.7% QoQ, +41% YoY) and high profit margin from tree liquidation. NPAT-MI reached VND 65 bn (-41% QoQ, +25% YoY), showing a positive start in the context that the first quarter of the year is usually the low season of the rubber harvest.
Q2-FY25 outlook: Tree liquidation is expected to continue to support profits in the context of rubber entering the off-peak
• Revenue is expected to reach VND 208 bn (-11% YoY, +3% QoQ), thanks to: 1/ Recording the rest of the 360-hectare liquidation plan with an estimate of VND 67 bn, 2/ Revenue of the rubber segment is forecast to decrease due to the impact of selling prices and seasonal nature.
• NPAT-MI was estimated at VND 77 bn (+5% YoY, +17% QoQ), reflecting the efficiency of cost management and stable contribution from financial income.
• Rubber prices show signs of recovery amid easing US-China tensions and persistent global supply shortage, while demand and downstream sectors like tires continue to grow. These dynamics support the view of stable prices in upcoming quarters. We maintain a cautious 2025 ASP forecast at VND 47mn/ton (-2% YoY), factoring in potential seasonal fluctuations and macroeconomic uncertainties.
• Therefore, according to our estimates, DPR's revenue and NPAT-MI in 2025 are estimated at VND 1,246 bn (+1.7% YoY) and VND 280 bn (equivalent to the same period last year). The corresponding EPS reached VND 3,223.
Valuation and recommendation
We use the partial valuation (SoTP) method to fully reflect the value DPR’s industrial park land fund, rubber mining activities and other income sources. Some of the main assumptions include: (1) industrial park segment: maintaining the assumption of extending the progress with 2 industrial parks in the Expansion NDP and the BDP, expecting the investment policy to be approved in 2025–2026; (2) Rubber segment: The average selling price in 2025 is assumed to be 47 million VND/ton with stable consumption; (3) Compensation income: Tien Hung 1 project (64 hectares) is expected to be re-auctioned, bringing in 56 billion VND (unit price 0.98 billion VND/ha).
On that basis, we have set the target price for DPR shares at VND 45,200/share, corresponding to an expected return of 16% compared to the current market price. We recommend ACCUMULATE for long-term investors.