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FRT - On a positive trajectory

Q4/2025: Strong earnings performance across both Long Chau and FPT Shop
In Q4/2025, FRT delivered robust results, with net revenue reaching VND 14,913bn (+30.3% yoy) and NPAT-MI of VND 290bn (+160.6% yoy). Key highlights include:
(1) FPT Shop (NPAT up 6x yoy) benefited from the overall growth of the ICT sector, driven by strong sales of the iPhone 17 and AI-enabled laptops and tablets, supported by a streamlined and cost-optimized store network over the past year.
(2) Long Chau (+105% yoy NPAT) maintained solid momentum in both pharmacy retail expansion (with 137 new pharmacies and 24 vaccination centers opened in the quarter) and market share gains, amid a favorable environment promoting modern retail chains with clear product traceability (pharmaceuticals and supplements). Net margin also improved by 9.9 pps yoy to 2.2%, driven by higher sales of dietary supplements and medical devices.
(3) Financial investment activities, initiated in Q3/2025, began to contribute meaningfully, with interest income reaching VND 102bn (3x yoy in Q4), helping reduce net financial losses by 95% yoy.
2026 Outlook: On a positive trajectory
• NPAT-MI in Q1/2026 is forecast to reach VND 243bn (+44.9% yoy). Key growth drivers remain consistent with Q4, including: (1) strong sales of the iPhone 17 and AI-enabled computing devices, alongside system-wide cost optimization at FPT Shop; (2) Long Chau’s aggressive store expansion into rural areas; and (3) improved efficiency of financial investment activities.
• Moving into 2026, we expect Long Chau to remain the primary growth driver for FRT, continuing to expand its rural footprint with approximately 400 new pharmacies and 60 vaccination centers. However, this expansion is likely to come at the cost of a slight decline in SSSG (-2% yoy), as a higher proportion of smaller-format stores limits same-store growth potential compared to earlier periods. This outlook is supported by a more favorable competitive landscape for modern pharmacy chains since 2H2025, driven by stricter enforcement against counterfeit and smuggled goods.
• Following restructuring, we expect FPT Shop to stabilize its ICT retail market share, supported by customer acquisition initiatives such as installment payment programs and enhanced collaboration with Apple. Going forward, growth is expected to come not from network expansion, but from increasing customer traffic per store, as the chain optimizes its product mix. We forecast SSSG of 13.4% yoy in 2026.
• Overall, we forecast FRT’s net revenue in 2026 to reach VND 60,253bn (+18.0% yoy), with -NPAT-MI/EPS of VND 1,147bn (+44.4% yoy) and VND 6,738, respectively.
Valuation and Recommendation
FRT’s key growth driver in recent years has been Long Chau, which is steadily strengthening its position in the pharmaceutical retail market. Although the vaccine segment has yet to disclose its detailed financial performance, we view it to be the second key growth pillar alongside pharma retail, which will enable Long Chau to sustain strong growth over the medium to long term. Meanwhile, FPT Shop is showing signs of recovery, and we expect the chain to make further positive improvements this year.
Using a sum-of-the-parts (SoTP) DCF valuation for both FPT Shop and Long Chau, we derive a target price of VND 186,000 per share. Based on the closing price as of March 31, 2026, this implies an expected return of 18%, corresponding to an ACCUMULATE recommendation.