HAX - Slowdown Is Temporary
Although Mercedes-Benz car sales saw a slowdown (+4% versus the average growth rate of 20%-30%), we still believe that the luxury car segment in Vietnam as ample room to grow due to the rapid growth of the middle class. Aggressive expansion plans by Daimler, which aim to raise the number of dealerships from the current 14 to 20 by 2020, also indicate the German company’s confidence in the market.
We expect HAX will be able to expand its current network by 1 or 2 more dealerships in 2018. Based on this assumption, we project HAX will sell 2,600 cars (+35% in 2018), leading to growth rates of 34% in its revenue and NPAT.
Recent selling pressure in the stock came mainly from the slowdown of Mercedes-Benz sales. It makes the stock's current price attractive. Our target price is VND29,500/share, 51% higher than the closing price on 16 April 2018. We have BUY rating on the stock
Hang Xanh Motors Service Joint Stock Company (HAXACO) is a Vietnam-based car dealer. The Company is a retailer of Mercedes-Benz branded automotives from Germany-based Daimler AG. It also trades used cars. Moreover, the Company is engaged in the offering of repair, maintenance and rescue services for automobiles, as well as the trading of accessories and spare parts used in automotive manufacturing and assembly. In addition, the Company is involved in the manufacturing of motor vehicle bodies, design and renovation of vehicles, along with car leasing. Other activities include freight trucking, insurance agency and real estate trading.
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.