Viet Dragon Securities - PPC – Normal growth from a low base

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Viet Dragon Securities

Hoai Trinh

PPC – Normal growth from a low base

In 4Q23, PPC recorded a commercial electricity output of 1.024 bn kWh (+34% QoQ, +24% YoY), thanks to the S6 unit resuming operations in September 2023, aligning with our prior expectations. We forecast PPC's revenue in 4Q23 to reach VND 1,920 bn (USD 79 mn) (+44% QoQ, +22% YoY). However, PPC's net profit in Q4 is expected to record a loss of VND 112 bn (USD 5 mn) due to (1) one-time expenses for the repair of the S6 unit and (2) low FMP prices in Q4 impacting the company's profit. Accordingly, we project PPC's 2023 net revenue and NPAT to be VND 6,015 bn (USD 247 mn) (+14% YoY) and VND 174 bn (USD 7 mn) (-32% YoY), respectively, equivalent to an EPS of VND 542 per share.

In 2024, we believe that (1) the rebound in electricity demand, (2) contributions from the S6 unit, and (3) dividend income from associated companies will be key factors driving PPC's performance. We forecast that (1) the commercial electricity output for 2024 will reach 4 bn kWh (+34% YoY), with the average selling price decreasing to VND 1,698 per kWh (-11% YoY), assuming that the average coal price will cool down in 2024. Accordingly, we project PPC's total revenue and NPAT in 2024 to reach VND 7,142 bn (USD 293 mn) (+19% YoY) and VND 497 bn (USD 20 mn) (+186% YoY), respectively, equivalent to an EPS of VND 1,354 per share.
We maintain an ACCUMULATE rating with a one-year target price of VND 15,500/share. With an expected cash dividend of VND 2,150/share in the next 12 months, the total return is determined at 12% based on the closing price on Jan 11^th 2024.

11/01/2024 7 EN

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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

Hoai Trinh

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PPC – Normal growth from a low base

AWAITING THE BREAKOUT

Vietnam chilled-fresh meat market – Significant long-term potential but difficult to realize in

The decline has not come to a halt

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