HAH - Expecting growth surge in 2H2024 thanks to high charter rates
• In 8M2024, HAH achieved a transport volume of 391,000 TEUs (+50% YoY). International and domestic volumes stood at 129,000 TEUs (+103% YoY) and 262,000 TEUs (+33% YoY), respectively. Several factors drive this growth in container transport: (1) HAH's partnership with the shipping company ONE to tap into the Intra Asia market, (2) there are more service routes/ports compared to the SPLY, and (3) the recovery in import-export activities since 2H2023.• In 1H2024, HAH reported revenue of VND 1,653 billion (+31% YoY, USD 66 mn) and NPAT-MI of VND 170 billion (-21% YoY, USD 7mn), completing 42% and 38% of full year targets, and achieving 53% and 58% of our forecast, respectively. A larger profit is expected to be concentrated in 2H2024, as the vessel HAIAN OPUS began chartering in August 2024 at a rate of USD 24,000 per day, and HAIAN MIND is set to be chartered from October 2024 at the same rate. This rate represents a 60% increase over the average charter rate of USD 15,000 per day in 1H2024.
• Given positive financial results in 1H2024, we have revised our projections for 2024. We now forecast revenue of VND 3,719 billion (+42% YoY, USD 148 mn) and NPAT-MI of VND 478 billion (+24% YoY, USD 19 mn), increasing 18% and 62%, respectively, compared to our previous estimates. The strong profit adjustment is due to HAH securing higher-than-expected charter rates. Diluted EPS is projected to be VND 3,184.
• Using a combination of the EV/EBITDA and P/B valuation methods, with target multiples of 1.7x and 7.0x, we have set a target price of VND 50,600 per share for HAH in 2024. At this target price, the 2024 forecasted P/B and EV/EBITDA multiples are 1.9x and 5.0x, respectively. We recommend a BUY rating for HAH, with an expected total return of 25%, based on the closing price as of September 20, 2024.
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