TNG – Attractive story with high order
- Q1-2024 revenue reached VND 1,354 billion (or USD 54.16 mn) (+1.4% YoY) due to improvements in both volume and selling prices. The gross profit margin increased by 60 bps compared to the same period last year. However, total selling and administrative expenses rose by 10% YoY, resulting in a 4% YoY decline in NPAT-MI to VND 42 billion (or USD 1.68 mn).
- The company has already secured sufficient orders until Q4-2024. We estimate that Q2-2024 revenue and NPAT-MI will be VND 2,256 bn (or USD 90 mn) (+18% YoY) and VND 109 billion (or USD E4.36 mn) (+88% YoY), respectively, assuming that the number of production lines reaches 346 in Q2-2024 and that revenue per production line increases by 5% YoY due to a 5% YoY increase in order selling prices.
- For 2024, we project revenue to reach VND 7,866 bn (or USD 314 mn) (+11% YoY), assuming the total number of production lines reaches 367 with an increase of 3-4 lines per month and selling prices rise by 5% YoY. Consequently, NPAT-MI is projected to reach VND 299 bn (or USD 11.9 mn) (+37% YoY). Adjusted EPS for 2024, accounting for the equivalent bonus and welfare fund, is VND 2,367 (+23% YoY).
- We recommend a NEUTRAL rating with a target price of VND 25,500 per share for a 1-year outlook, based on an average 4-year target P/E of 8.5x. Plus expected cash dividend of 400 VND/share, the expected 12-month return is 6% compared to the closing price of VND 24,500 per share as of May 15, 2024. The target price currently does not include the potential revenue from leasing 10 hectares in the Son Cam Industrial Zone.
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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