SIP – Stable growth in leasing and providing industrial park services
• In 1H2024, SIP recorded revenue and gross profit of VND 3.76 tn (USD 151.6mn, +23% YoY) and VND 516bn (USD 21mn, +23%YoY), respectively. Electricity and water distribution for industrial parks (IPs) continues to be the main revenue-generating sector for SIP, with revenue and gross profit to reach VND 3.1 trillion (USD125mn, +22%YoY) and VND 238 billion (USD 9.6mn, +21%YoY), respectively. In terms of sales, the company signed new lease contracts with a total area of ~28ha (completing 60% of the business plan), mainly leasing to customers with large areas.• For 2H2024, in addition to positive business results from electricity and water distribution to IPs, we expect SIP to start recording revenue from new lease contracts (signed in 2024); thereby revenue and gross profit could reach VND 3,757 billion (USD 151mn, +4%YoY) and VND 571 billion (USD 23mn, +11%YoY), respectively. NPATMI for the 2H2024 and full year can reach VND 567 billion (USD 22.9mn, +12%YoY) and VND 1,111 billion (USD 44.8mn, +20%YoY), respectively. EPS 2024 can reach VND 5,500.
• Using the sum-of-the-parts method, we set a target price for SIP shares at VND 101,600 per share (with an upside potential of +39% compared to the closing price on October 02, 2024), equivalent to a BUY recommendation for long-term investment.
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