HDG [BUY +54.2%] - Attractive valuation vs both power and real estate peers

- We cut our target price by 31% for HDG but reiterate our BUY rating.

- Our lower TP is due to (1) a 55% cut in our real estate segment valuation as we delay the sales launches of HDG’s real estate projects by one to two years and (2) a 20% cut in our energy segment valuation due to 100-bp increases in our house equity risk premium and cost of debt assumptions. These factors are partly offset by the positive impact of rolling our TP horizon forward to end-2023.

- We lower our 2022-2025F aggregate NPAT forecast by 34% as we delay the sales launches of Charm Villas Phase 3, two real estate projects in HCMC and two real estate projects in Hanoi.