HDG [OUTPERFORM 12.1%] - Giant An Phong wind farm to fuel long-term growth

- We raise our target price for HDG by 7% but downgrade our rating from BUY to OUTPERFORM as the company’s share price has increased 17% over the past two months.

- Our higher TP is mainly due to (1) our 8% higher valuation for the power generation segment, which is driven by the addition of the giant An Phong wind farm, and (2) as we reduce the discount on the real estate segment’s RNAV from 15% to 5% to reflect our expectation for better investor sentiment in H2 2023 following recent regulatory developments and faster-than-expected interest rate cuts (see our Residential Real Estate Report, dated June 21, 2023). These factors outweigh our 5% lower valuation for the real estate segment as we delay the handover schedule of the Hado Minh Long (Thu Duc City, HCMC) and Hado Green Lane (District 8, HCMC) projects from 2024 to 2025.