- We downgrade our rating for GVR from OUTPERFORM to MARKET PERFORM as we trim our target price (TP) by 3% to VND15,800/share. GVR’s share price has increased 17% YTD.

- Our lower TP is mainly driven by (1) cutting our profit forecasts for the rubber and wood segments, which causes us to decrease our 2023-2025F aggregate NPAT-MI forecasts by 21%, and (2) a lower net cash balance as of end-Q1 2023. These negative impacts are partially offset by rolling our TP horizon forward to mid-2024 from end-2023.

- We cut our 2023F revenue and NPAT-MI forecasts by 10% and 26% to VND24tn (USD1bn; -6% YoY) and VND3.2tn (USD138mn; -16% YoY), respectively, to mainly reflect lower sales volumes for rubber and wood segments. Demand for these products was significantly impacted by the global economic downturn in Q1 2023. 

- Meanwhile, we cut our 2024/2025F NPAT-MI forecasts by 14%/23% as we are now more conservative on the revenue growth of the rubber and wood segments. We lower our revenue assumptions for these segments in 2024/2025F by 14%/15%. 

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