- We cut our target price for HPG by 48% to VND20,500/share due to our 43% decrease in aggregate 2022-2026F NPAT-MI as a result of slower volume growth (especially in 2022-2023F), lower steel selling prices, higher WACC and lower target P/E. These factors are partially offset by rolling our target price horizon to end-2023. However, we maintain our BUY rating for HPG as the company’s stock price has dropped 36% over the last three months.  

- HPG reported its first ever quarterly net loss of VND1.8tn (USD72.4mn) in Q3 2022 despite positive steel sales volume growth, which we attribute to 1) unfavorable trends in both input material prices and output selling prices as well as 2) FX losses. 

- We cut our 2022F NPAT-MI by 59% to VND9.3tn (USD378.3mn; -73% YoY) as we expect low sales volume resulting from stagnant domestic private construction activities and high FX losses will translate to a net loss of VND1.2tn (USD48.7mn) in Q4 2022 despite a margin recovery. 

Powered by Froala Editor