We attended IDC’s November 4 analyst meeting and our key takeaways are below:

* IP land sales: In 9M 2024, IDC recorded IP land sales of 65.1 ha in contracts/MOUs (vs our 2024F forecast of 100 ha and the company’s full-year guidance of 145 ha), of which 21.8 ha were in Q3 2024 (vs 26.2 ha in Q1 2024 and 17.1 ha in Q2 2024). The 9M 2024 IP land sales at Huu Thanh, Cau Nghin, Que Vo 2, Phu My 2 Expansion, and Phu My 2 IPs were 19.1 ha, 15.1 ha, 14.6 ha, 9.1 ha, and 7.1 ha, respectively. Per IDC, the company continues to receive strong interest from several FDI investors, but they are temporarily refraining from making decisions on further investments partly because they are waiting for clearer policies from the US and Vietnam.

* IP land handovers: IDC handed over 88 ha in 9M 2024 (compared to our 2024F forecast of 110 ha), including 23 ha handed over in Q3 2024. Of the 88 ha in 9M 2024 handovers, 56 ha were from IP land sales made in 2023 and 32 ha were from new contracts in 9M 2024. We estimate that the unbilled backlog at end-Q3 2024 amounted to ~103 ha (70 ha from 2023 contracts/MOUs and 33 ha from 9M 2024 contracts/MOUs). Notably, among the unbilled backlog is around 30 ha remaining in the Phu My 2 IP from the land sales contract to Hyosung. 

* Selling prices: The average asking price (ASP) of IDC’s current IP projects at end-Q3 2024 remained stable QoQ at ~USD135/sqm, but slightly increased vs the end-2023 ASP of ~USD129/sqm. The end-Q3 2024 ASPs of Huu Thanh, Que Vo 2, and Cau Nghin have increased to around USD161/sqm, USD150/sqm, and USD81/sqm (vs end-2023 prices of around USD148/sqm, USD119/sqm, and USD77/sqm), respectively. Additionally, the respective prices at Phu My 2 and Phu My 2 Expansion have remained broadly stable at ~USD124/sqm and ~USD126/sqm.

* Tan Phuoc 1 IP (total site area of 470 ha; Tien Giang Province): IDC expects for this IP to launch by end-2025 or early-2026. This project received investment approval in May 2024 and IDC expects a smooth land clearance process as 100% of the land is agriculture land owned by the Government. This guidance is in line with our expectation as we anticipate this project to start contributing to IDC’s IP land sales by 2026F. 

* Vinh Quang IP (total site are of 350 ha; Hai Phong Province): IDC expects that this IP could potentially receive investment approval by 2025-26G. We currently forecast the Vinh Quang IP to start land sales from 2027F.  

* Residential segment: The Bac Chau Giang project (total includes ~60 low-rise units and 1 high-rise block; Ha Nam) has fully sold out the low-rise portion, with expected total revenue of around VND600bn (USD24mn) for the low-rise portion. Additionally, around 0.73 ha remains as unbilled backlog from the commercial land sales contract to Aeon in the central residential expansion project in Long An. We estimate that the total unbilled backlog from Bac Chau Giang and contract sales to Aeon amount to ~VND500bn (USD20mn). 

* Overall, we anticipate insignificant changes to our 2024F IP land sales and handovers forecasts, pending a fuller review. Please also refer to our October 30 Earnings Flash for IDC’s Q3 2024 results.

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