VSC – Strong profit growth due to core business
• In 6M2024, container throughput reached 562,000 TEUs (+15% YoY), with volumes at VIP Green, Green, and Nam Hai Dinh Vu (NHDV) ports recorded at 320,000 TEUs (+6% YoY), 135,000 TEUs (-3% YoY), and 107,000 TEUs, respectively.• In 6M2024, revenue and PBT stood at VND 1,304 billion (+31% YoY) and VND 203 billion (+93% YoY), completing 53%/63% of the annual targets and 52%/52% of our projections.
• In July 2024, VSC recovered VND 705 billion from its equity investment in the Hyatt Place hotel project. The capital raised through issuing shares to existing shareholders and the hotel investment project was used to increase its ownership stake to 100% in Nam Hai Dinh Vu port, with the total value of the transaction amounting to VND 3,200 billion (USD 127 million).
• We have revised our projections for 2024F, with revenue and net profit attributable to the parent company forecasted at VND 2,524 billion (+16% YoY) and VND 240 billion (+93% YoY), representing a 5% and 26% increase from our previous estimates, respectively.
• Using the FCFF method (WACC: 12%, g: 1%) and P/B (@P/B: 1.5x), our target price for VSC stock is VND 21,400/share, implying a total expected return of 16% compared to the closing price on September 5, 2024. We recommend an ACCUMULATE for VSC.
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