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NLG –Housing demand is the premise for recovery in 2024

• In 3Q2023, NLG recorded revenue of VND 357bn (USD 14.7mn, -63%YoY), due to the handover of units in the Southgate project (high-rise and low-rise units). With income from associates of VND 89bn (from the Mizuki project, with handover of 227 units in block Flora Panorama) and deferred tax income of VND 81bn (during the period, company has tax-deductible expenses), NLG reported 3Q2023 NPAT-MI of VND 66bn (USD 2.7mn, -45%QoQ, +739%YoY). For 9M2023, the company recorded revenue of VND 1,546bn (USD 63.6mn, -43%YoY), and NPAT-MI of VND 194bn (USD 8mn, +63%YoY).
• In 4Q, we expect the company to have positive business result, with: 1/ In December, the presales value is expected to record sales of VND 1,500 bn (2023 pre-sales could reach ~ VND 4,500 bn, fullfiled 47% of 2023 business plan), 2/ An estimated revenue of VND 1,512 bn from the Izumi project (corresponding to delivering ~70% of total units), and the 4Q NPAT-Mi is expected to reach VND 258 bn (USD 10.6mn, -41%YoY). For the whole year 2023, the revenue and corresponding EPS are expected to reach VND 452 bn (USD 18.6mn, -19% YoY) and VND 1,131, respectively.
• For 2024, with expectation that NLG's product segments are in accordance with real housing needs, the company can record significant growth in sales (presales value can be recorded at VND 8,400 bn, +87%YoY), from Waterpoint urban area (Long An) with The Pearl subdivision (~250 villas), block CC5 – the Mizuki Park, and Nam Long Can Tho project with diverse products (land-lot, EHomeS social housing). Revenue and NPAT – MI in 2024 are forecast to reach VND 7,066 bn (USD 291mn, +75%YoY) and VND 750 bn (USD 31mn, +66%YoY), respectively. The corresponding EPS is 1,940 VND.
• Using the RNAV method, we have a target price of VND 38,400/share (upside +8%, including cash dividend of VND 500/share), equivalent to an ACCUMULATE recommendation.