- We cut our target price (TP) for HDG by 2.3% and downgrade our rating from OUTPERFORM to MARKET PERFORM. Our lower TP is due to a 2.9% decrease in our aggregate 2023-2027F NPAT-MI forecast, which is mainly driven by a 44% decline in our aggregate earnings projection for HDG’s Infra 1 solar farm as we reduce our assumption for the solar farm’s feed-in-tariff (FiT) from 9.35 US cents/kWh (solar FiT 1) to 7.09 US cents/kWh (solar FiT 2) starting in 2023F as Government inspectors recently found this project to be unqualified for solar FiT 1.

- We keep our 2023F NPAT-MI forecast nearly unchanged at VND886bn (-19% YoY) but reduce our 2024F NPAT-MI forecast by 10% to VND1,051bn (+19% YoY) due to (1) our lower 2024F NPAT-MI forecast for Infra 1 and (2) delaying our assumption for the commercial operation of the CC3 hotel & office building from 2024 to 2025 following HDG’s guidance. 

- We forecast an EPS CAGR of 28% in 2022-2027F, which is driven by the handovers of six real estate projects, solid cash flows from existing power plants, and our projection for an additional 480 MW of wind power capacity in 2025-2027F. 

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