We downgrade our rating for CII to MARKET PERFORM from OUTPERFORM and cut our target price by 10% to VND23,300/share. CII’s share price has increased 7% over the last three months.

Our lower target price is mainly due to our 0.5-ppt higher risk free-rate assumption and the Trung Luong - My Thuan (TL-MT) Expressway BOT project’s toll collection starting on August 9, 2022 vs our expectation of July 1, 2022.

Although the TL-MT Expressway BOT has commenced toll collection, we assume that CII will not consolidate this project into its 2022F financial statements as the consolidation requires approval from Government authorities, which is a time-consuming process.