KDH [BUY +20.1%] - Profit to decline, but presales to rise due to new launches

- We maintain our BUY rating for KDH and raise our target price by 1.2% to VND33,400/share.

- Our higher target price is mainly due to (1) changing our valuation method for the 6-ha Doan Nguyen project (Binh Trung Dong Ward, Thu Duc City) from book value to DCF as we now have a clearer picture of this project’s legal status, and (2) KDH’s lower net debt position at end-2022. These positive changes are partially offset by our lower valuation for medium-term projects due to slower sales and handovers expected in 2023.

- Following our lower sales expectation, we cut our 2023F NPAT-MI by 30% but raise our 2024F NPAT-MI by 4% as we expect sales and deliveries at Solina Phase 1 (Binh Chanh, HCMC — 500 low-rise units) to start in 2024 vs previously 2023.