VCSC: Recommended market relevance for PVSViet Capital Securities Company (VCSC) said that Petrovietnam Technical Services Joint Stock Corporation (HNX: PVS) has just announced the AGM document with the goal of 2021 revenue reaching 10,000 billion. VND (down 49.6% over the same period) and after-tax profit reached VND 560 billion, down 23.8%. PVS’s revenue and profit targets for this year are 33.3% and 12.5% lower than 2020’s plans, respectively, based on lower workload assumptions for the mechanical and oil and gas segments. Meanwhile, the profit after tax target in 2021 is lower than VCSC’s forecast of 29.5%, however, it is also noted that PVS is often cautious in making business plans when net profit is actually 20%-60% higher than the target set in the last 5 years.
Regarding the dividend payment plan, PVS proposes a ratio of 7% in cash for 2020 and 2021 (yield of 2.9%), 30% lower than VCSC’s current forecast of 10%, equivalent to 1,000. VND / share (yield 4.2%).
VCSC said it will attend the shareholders meeting on April 28 to record more details about this dividend plan. Currently, VCSC has a market-matching recommendation with a target price of VND 23,000 / share.
With the closing price on April 9 of VND 23,800 / share, PVS is trading at a forward P / E of 2021 of 18.2x and EV / EBITDA of 6.2x, based on VCSC forecasts.
PHS: Recommend to buy ACV, target price of 85,600 dong / share
Phu Hung Securities Company (PHS) said that Vietnam Airport Corporation (UPCoM: ACV) currently manages 22 airports across the country (9 international and 13 domestic airports). ACV’s revenue comes from 3 main segments, including revenue from aviation services (accounting for 76.7% of total revenue), revenue from non-aviation services (16.8%) and revenue from sales (6, 5%).
By the end of 2020, ACV’s total revenue reached 7,784 billion VND, a decrease of 57.5% over the same period due to the impact of epidemics that caused the number of passengers passing through airports to plummet.
In particular, revenue from providing aviation services decreased by 59.3% in the same period to VND 5,987 billion due to the direct impact of the decrease in passenger numbers, in addition to airport tax reduction policies under Circular 19/2020/TT-BGTVT to support airlines.
Non-airline services revenue decreased more slowly at 39% in the same period to 1,312 billion dong, sales revenue also dropped by 66.6% over the same period to 503 billion dong.
Although revenue decreased sharply, expenses such as depreciation, staff costs … were almost unchanged or decreased slowly, leading to a decline in profit after tax by 79.2% over the same period, to only 1,712 billion.
In 2021, PHS forecasts that the number of flights will increase by 21.3% over the same period (30.8% lower than in 2019) as the epidemic continues. However, ACV will no longer be subject to airport tax reduction policies to support airlines. In 2021, ACV’s revenue is expected to grow 28% to 9,963 billion dong.
Along with that, forecasted fixed expenses for the year will grow more slowly than revenue growth, making expected gross profit margin improved to 33.2%, up 14.8 percentage points compared to 2020. Profit after tax is also forecasted positively, estimated at VND 3,027 billion (up 76.7% year on year).
PHS believes that ACV will benefit the most when the aviation industry recovers thanks to its almost monopoly position in managing 22 Vietnamese airports and is also the investor of Long Thanh International Airport.
Currently, the International Air Transport Association (IATA) forecasts that the aviation industry will recover to pre-epidemic levels from 2023. After the epidemic was fully controlled, ACV’s CARG expectations reached 15.8% per year as growth in the period 10 years before the epidemic thanks to economic development, tourism and middle-class growth.
On the other hand, regarding the condest of air zone assets, the Government has decided to assign ACV to manage, use and operate aviation infrastructure assets at 22 airports by the method of not including the composition of state capital in enterprises from December 7, 2020 to December 31, 2025.
This will support ACV with its plan to move to HoSE in 2021 with the expectation that there will be no exclusion in its financial statements. In addition, the consolidation of properties in the flight zone also helps increase the revenue scale, increase the ability to mobilize bank capital to finance investment projects and new expansion.
Using DCF and P / B methods, PHS estimates the fair value of ACV to be VND 85,600 / share, up 15.4% from current price.
SSI: Positive recommendation for DGW with a 1-year target price of VND139,000 / share
SSI Securities Company (SSI) said that in 2020, Digital World Joint Stock Company (HoSE: DGW) recorded positive business results with net revenue and profit after tax increased by 48% and 55% over the same period, reaching VND 12,500 billion and VND 253 billion, completing 123% and 125% of the year plan, respectively.
This positive result is due to increased sales of laptop computers due to increased need to work / study at home during the epidemic; Xiaomi mobile phones increased its market share from nearly 8% in the fourth quarter of 2019 to 13% at the end of 2020 and a new source of revenue from Apple products.
The recent Annual General Meeting of Shareholders has approved a 10% cash dividend (dividend yield of 0.8%) and is expected to pay in Q2 / 2021. In addition, existing shareholders will receive bonus shares at the rate of 1: 1.
DGW shareholders also approved a plan to issue 1.2 million ESOP shares at the price of 10,000 dong / share. The enterprise plans to issue in May 4-5 / 2021, after issuing bonus shares (with a ratio of 1: 1).
Regarding the option to buy for the employees, the meeting approved the plan of each option allowing the holder to buy shares at the price of 120,000 VND / share. Number of call options issued will not exceed 2.5% of outstanding shares. Time to issue buy option is expected in early 2022, exercise period is 1 year from issuing date of call option.
In 2021, although DGW’s management set a very conservative target for net profit growth, only 19% year-on-year increase (while profit in Q1 / 2021 increased 113% year-on-year), however SSI raised its annual profit estimate by 25% to 391 billion dong, equivalent to an increase of 54% over the same period.
In 2022, SSI estimates that DGW’s net profit will increase by 31%. In particular, with Xiaomi continuing to gain market share, long-term prospects from 5G implementation, and positive psychology after being granted the right to buy, SSI decided to re-evaluate the target P/E value from 11 times to 14 times.
Using adjusted 2021-2022 estimate and revalued target P / E of 14 times, SSI introduces a new target price of VND139,000 / share, equivalent to a 14% return (including dividend yield 0.8%).
Source: vietnamfinance.vn – Translated by fintel.vn