NLG – Pre-sales show improvement in 2H2024
• In Q2 2024, NPAT-MI improved compared to the previous quarter, reaching VND 144 billion (+19% YoY, compared to a loss in Q1 2024). This improvement is attributed to NLG's continued delivery of projects on schedule and revenue from the sale of a 25% stake in the Paragon Dai Phuoc project to a Japanese partner, generating financial gains of VND 230 billion. For the full year of 2024, we estimate that the revenue and NPAT-MI will be VND 7,389 billion (+132% YoY) and VND 453 billion (-6% YoY), respectively, primarily from the delivery of the Akari (Phase 2) and Nam Long 2 – Can Tho projects. The EPS for 2024 is forecast at VND 1,169.• Sales in Q2 2024 amounted to VND 1,510 billion (+29% QoQ), coming from projects such as Akari, Waterpoint, and Mizuki, with a cumulative total for the first half of 2024 reaching VND 2,678 billion (+209% YoY, achieving 28% of the annual plan). Given the warming up of the real estate market, we expect sales to continue to rise in 2H2024 due to: 1/ affordable housing options to meet actual demand from the EhomeS Can Tho project, Can Tho land plots, and Ehome Southgate, which are expected to have good absorption rates; 2/ NLG's continued policy of supporting homebuyers; and 3/ sustained low interest rates.
• Based on the RNAV valuation method, we estimate NLG's fair value at VND 43,900/share, providing a 12-month expected total return of 6% compared to the closing price on July 30, 2024 (including a cash dividend of VND 500 per share). We recommend an ACCUMULATE rating for NLG
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