- We cut our target price (TP) for MSN by 14% but upgrade our rating to BUY from OUTPERFORM as the stock’s price has dropped by ~18% over the past three months. We remain bullish on the outlook for MSN’s leading, wide-ranging consumer businesses, which should benefit from consumption growth in Vietnam over the long term. 

- In 2023F-26F, we forecast MSN’s EBIT CAGR of 23% - contributed by (1) 17% EBIT CAGR of consumer-retail arms (i.e., combined EBIT of MCH, WCM, PL, and MML) and (2) 20% EBIT CAGR of MHT as the global economy recovers.

- Our lower TP is caused by (1) assigning a 10% conglomerate discount to MSN’s valuation (more details on page 6), in addition to (2) cuts in our valuations for MCH and WCM by 8% and 2%, respectively, due to our lower near-term forecasts for WCM’s store expansion and MCH’s growth. These negative impacts are partly offset by rolling over our TP horizon to end-2024.

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