PHR – The upside value is on potential mode.
- We think that there is still uncertainty related to rubber price and progress of handover to the tenants in VSIP3, that may affect the success of 2023 business In our base case, the total revenue is estimated at VND 1,685 billion (USD 73.8 million, -1.4% YoY), NPAT could reach VND 528 billion (USD 23.1 million, - 40.4%YoY), fulfill 96% 2023 plan. The corresponding EPS will be 3,896 VND.
- In the long term, the rubber segment seems not profitable compared to the industrial park business. PHR is in transition phase to focus on IP segment. However, there are still barriers ahead related to regulations including 1/ Restructuring plan of GVR – a state own enterprise (SOE), 2/ Land used after going equitization following 60 resolution/2018/QH2014 as it require the asset has to be used as the initial register purpose, 3/ Decree 167/2017/ND-CP on disposition of public property, which required auction process, and 4/ the investment law that regulates who to be chosen as the investor of the project. GVR and PHR are trying to solve each of these bottlenecks.
- Target price is revised up by 19.5% to VND 49,000/share as we reflect positive outlook of NTU-3 (Ownership of 32.85%) when the crucial bottleneck was solved, and land handover of the project will be processed further. Combined with an annual cash dividend of VND 3,000/share, the total expected return is +11.7% (based on the closing price as of June 30th, 2023).
Phuoc Hoa Rubber Joint Stock Company is a Vietnam-based company active in the rubber industry. The Company is engaged in rubber plantations and the manufacturing of rubber products. It processes latex and manufactures basic rubber products, such as Standard Vietnamese Rubber (SVR) products. The Company is also involved in the processing and trading of rubber wood harvested from its rubber plantations. In addition, it is engaged in the operation of gasoline stations. Other activities include construction and real estate operations.
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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