Report

KBC – The 2023 plan is ambitious

  • In the first 9 months of 2022, KBC's total revenue reached VND 1,289 billion (-58%), and NPAT-MI soared to VND 2,034 billion (+256% YoY). In addition,  KBC is expected to earn VND 2,985 billion in revenue and VND 3,033 billion in NPAT-MI for the entire fiscal year 2022.
  • By the end of 2022, we estimate that KBC's remaining leasable land bank in Quang Chau, Tan Phu Trung and Nam Son Hap Linh IPs will be ~290 ha. In the base case, we estimate that KBC can lease 126 hectares in 2023. Regarding residential real estate, Trang Cat and Phuc Ninh are two projects facing legal bottlenecks. Meanwhile, Trang Due residential area has the commercial area of 22 hectares; which has fulfilled its obligation to pay land use levy and is a project that can record revenue and profit next year. Accordingly, total 2023 revenue and NPAT are estimated at VND 5,289 billion and VND 1,869 billion, respectively.
  • On December 8, 2022, Kinh Bac City Development Holding Corporation (KBC) held the second Extraordinary General Meeting of Shareholders 2022. The meeting approved important decisions including: 2023 business plan, authorized the Board of Directors (BOD) to list bonds, cancel the plan of shares private placement, plan to buy treasury shares, and plan to pay cash dividends.
  • Based on the Sum of the parts method (SOTP), we adjust the target price to VND25,000/share, a 25% decrease from the previous valuation due to the postponement of the sale of residential real estate projects until after 2024. If KBC pays a cash dividend of VND2,000 per share in 2023, the total expected return for the next twelve months is +9.3% (based on the closing price on January 3rd, 2023).

 

Underlying
Kinhbac City Development Share Holding Corp

Kinh Bac City Development Share Holding Corporation is a Vietnam-based company engaged in the real estate industry. The Company develops and operates industrial zones, residential areas, urban areas, as well as commercial and residential buildings. It is also involved in the provision of water and electricity supply services for industrial zones, along with engineering, architectural, interior decorating and maintenance services of real properties. Other activities include infrastructure construction and the offering of tourism services, hotel and restaurant services. The Company has six subsidiaries.

Provider
Viet Dragon Securities
Viet Dragon Securities

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.

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Analysts
Hung Le

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