HDG [OUTPERFORM +11.5%] - Charm Villas sales to boost 2025F earnings

- We raise our target price (TP) for HDG by 5.8% to VND31,000 and upgrade our rating to OUTPERFORM from MARKET PEFORM.

- Our higher TP is primarily driven by (1) an 8% higher valuation for the energy segment (mainly due to our higher aggregate hydropower earnings projection), (2) a higher parent company net cash balance, and (3) the positive impact of rolling our TP forward to end-2025. These factors outweigh our 4% lower valuation for the real estate segment, mainly due to our 80% lower valuation for the Dich Vong complex due to minimal progress on legal procedures and capex spent.

- We maintain our aggregate 2024-2028F NPAT-MI forecast with respective changes of -9%/-9%/+30%/-12%/+6% for 2024/25/26/27/28F, mainly due to (1) 11% higher aggregate NPAT-MI from Charm Villas phase 3, and (2) 9% higher aggregate NPAT-MI from the energy segment (mainly driven by higher projected hydropower earnings). These factors offset our lower profit forecast for Dich Vong and a higher Holdco expenses projection.