IMP - Expect profit recovery in second half of 2024
We maintain a positive view on IMP’s long-term prospects due to the harmony between the company's strategy and the direction of the management agency. The Bidding Law No. 22/2023/QH15, effective from the beginning of 2024, helps IMP to add 12 products to the list of drugs prioritized for bidding in tiers 1 and 2, opening up opportunities for the company to increase its market share in the ETC channel. This context helps IMP increase consumption output while leading in the number of EU-GMP production lines, thereby improving profitability over time by increasing the proportion of the ETC channel, a channel with higher profit margins than the OTC. Meanwhile, IMP aims to maintain existing customers in the OTC.We use the FCFF (60%) and P/B (40%) methods to determine the target price for IMP at VND 82,400/share. The high weighting of the FCFF method reflects our long-term investment view on this stock. Combined with the VND 1,500 cash dividend, the total expected return is 7% based on the closing price on July 11, 2024. We issue an ACCUMULATE recommendation for IMP
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