PC1 – New projects will support growth in the coming years
- For 9M2022, PC1 earned VND 262 bn (or USD 10.7 mn) in net profit, -10% YoY. In terms of gross profit, the power generation group grew by 145% thanks to new contribution from wind power farms while other sectors dropped. Utilizing USD-denominated loans at low-interest rates to finance power projects used to be one of the company’s edges yet it becomes the headwind during growing uncertainties. As of Dec 31st, 2022, VND appreciated compared to that of Sep 30th We forecast the company to gain financial income in 4Q2022.
- FX has hampered earnings during 2022, especially in 2Q22 and 3Q22. However, EBITDA has been on an upward trend since 2019, with +39% and 23% in 2022 and 2023, respectively. Meanwhile, the bottom line will likely reach a trough in 2022 and is expected to recover from 2023 to VND 664bn (or USD 28 mn, +172% YoY).
- Our latest target price for PC1 is VND 26 000, offering an upside of 6% compared to the closing price as of Jan 16th, 2023. We recommend investors to BUY this stock when the market has a deep correction due to its high beta nature. We will update our target price in our next report.
Power Construction Joint Stock Company No 1 (PCC 1) is a Vietnam-based company primarily engaged in power transmission structures construction. Its leading business activities include the construction of electric power transmission lines, towers, and hydro power generation plants; the manufacture of galvanized structural steels; the mining of iron ores, and the wholesale of construction materials. The Company, via its subsidiaries, is also involved in the development of residential and commercial properties, the manufacture of motorized vehicles, as well as the operation of storage and warehousing facilitites.
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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