- We cut our target price (TP) for CTG by 2.0% to VND39,500/share and maintain a BUY rating.

- Our lower TP is mainly due to a 6.2% decrease in our projection for aggregate 2023-2027F NPAT-MI (respective decreases of -7.8%/-8.7%/-8.3%/-4.4%/-4.1% in 2023/24/25/26/27F), which is partly offset by (1) the positive impact of rolling our TP horizon forward to end-2024 and (2) lowering our assumption for CTG’s cost of equity from 14.6% to 14.5% as a result of an updated beta. We maintain our target P/B assumption at 1.30x.

- Our lower 2023-2027F NPAT-MI is derived from (1) a 2.0% aggregate decrease in NII following a downward revision in our average NIM assumption from 3.11% to 3.05%, (2) 5.4% aggregate increase in provision expenses, and (3) 6.4% aggregate decrease in net other income following our more conservative assumption for recovery income from written-off bad debts. These are partly offset by a 9.5% aggregate increase in NFI (including gains from FX trading).

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