- We upgrade our rating for BMP to BUY from OUTPERFORM, raising our target price (TP) by 19% to VND130,300/share.

- Our higher TP reflects respective 14%/16%/17%/19%/21% increases in our projected 2024/25/26/27/28F NPAT-MI, primarily driven by an improved GPM outlook. This follows a stronger-than-expected H1 GPM of 43.2%, beating the previous record high of 40.6% in H1 2023. We raise projected GPM by 420/500/440/420/400bps for 2024/25/26/27/28F.

- The improved GPM outlook is due to (1) lower-than-expected PVC input prices as China’s demand recovery remains weaker-than-anticipated, and (2) our expectation that BMP can raise its ASP by 4% YoY in 2025F to offset a projected 8% increase in input costs. We now forecast BMP’s 2024/25F raw material costs to grow -5%/+8% YoY (vs +7%/+10% previously).

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