IDC – Strong profit growth in H1 due to YoY increases in IP & UA land handovers – Earnings Flash
  • 2024-07-29T00:00:00
  • Company Research
  • IDC released its Q2 2024 results with revenue of VND2.1tn (USD84mn; -11% YoY) and NPAT-MI of VND432bn (USD17mn; -19% YoY). The YoY declines are mainly due to lower one-off IP land sales recognition. IP land handovers in the quarter were mainly from Que Vo, Cau Nghin & Huu Thanh IPs.  Additionally, IDC has not yet disclosed the progress of its Q2 2024 IP land sales.
  • In H1 2024, IDC’s revenue increased 30% YoY to VND4.6tn (USD181mn) while its NPAT-MI surged 65% YoY to VND1.1tn (USD44mn), representing 54% and 60% of our respective full-year forecasts. We expect no significant changes to our 2024F forecasts, pending a fuller review.
  • The IP segment’s revenue in H1 2024 was VND2.4tn (USD92mn; +36% YoY; accounting for 51% of IDC’s net revenue), mainly from IP land handovers at the Huu Thanh, Phu My 2, & Que Vo IPs. While the segment’s revenue was broadly in line with our expectations, its H1 2024 GPM exceeded our 2024F projection, which we attribute mainly to higher-than-expected ASP increases.
  • We estimate that IP cash inflows in H1 2024 surged 77% YoY to VND2.8tn (USD108mn) and completed 53% of our 2024F forecast, which is mainly due to the substantial unbilled backlog (~118 ha at end-Q1 2024). We expect IP cash inflow to remain strong in upcoming quarters as the large unbilled backlog persists, while IP land sales could pick up. 
  • The real estate segment’s revenue surged 6.8x YoY to VND369bn (USD14mn) in H1 2024, which was mainly due to the handover of 1.45 ha of commercial land (in the central residential expansion project in Long An) to Aeon. We expect handovers of the remaining 0.73 ha (VND73bn/USD2.9mn) land to Aeon as well as sales launch & handovers at the Bac Chau Giang UA in H2 2024F.

IDC’s H1 2024 results

VND bn

Q2
  2023

Q2
 2024

YoY

H1
 2023

H1
 2024

YoY

2024F

H1 as % of 2024F

Net revenue

2,408

2,148

-11%

3,554

4,616

30%

8,513

54%

   -  Industrial park (IP)

1,521

1,046

-31%

1,728

2,354

36%

3,894

60%

   -  Energy

698

780

12%

1,340

1,468

10%

3,053

48%

   -  Real estate

25

88

3.6x

55

369

6.8x

634

58%

   -  Other services

165

234

42%

432

424

-2%

932

46%

Gross profit

892

810

-9%

1,196

1,908

60%

3,139

61%

SG&A expenses

-95

-91

-4%

-162

-184

13%

-418

44%

EBIT

797

719

-10%

1,034

1,724

67%

2,721

63%

Financial income

76

39

-48%

103

70

-32%

180

39%

Financial expense

-51

-35

-31%

-105

-70

-33%

-200

35%

Net income from affiliates

1

1

53%

1

1

64%

0

N.M.

Net other income

3

13

4.1x

8

11

39%

13

85%

PBT

827

737

-11%

1,040

1,737

67%

2,714

64%

NPAT-MI

534

432

-19%

681

1,128

65%

1,889

60%

 

 

 

 

 

 

 

 

 

GPM

37.1%

37.7%

 

33.6%

41.3%

 

36.9%

 

      -  Industrial park (IP)

50.7%

59.5%

 

51.7%

61.9%

 

55.2%

 

      -  Energy

7.2%

4.6%

 

9.5%

4.8%

 

10.1%

 

      -  Real estate

74.9%

112.1%

 

65.4%

73.7%

 

62.7%

 

OPM

33.1%

33.5%

 

29.1%

37.4%

 

32.0%

 

NPM

22.2%

20.1%

 

19.2%

24.4%

 

22.2%

 

Source: IDC, Vietcap forecast (last updated May 9, 2024)


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