- We cut our target price (TP) for MWG by 26% but maintain our BUY rating. Although we expect 2023 to be challenging for the two ICT retailers under our coverage, MWG’s current 2024F/25F PERs of 11.5x/8.4x look appealing vs our 2022-25F EPS CAGR forecast of 18%.

- Our lower TP is mainly due to cutting our aggregate 2023-25F NPAT-MI by 29%, which is partly offset by rolling our TP horizon forward to mid-2024. First, we cut the aggregate 2023-25F NPAT of The Gioi Di Dong (TGDD — including TopZone) and Dien May Xanh (DMX) by 25% due to significantly weaker-than-expected sales in 2M 2023. Second, we increase the aggregate 2023-24F net loss for grocery chain Bach Hoa Xanh (BHX) by 25% due to (1) weaker-than-expected sales/store in 2M 2023 and (2) its 2022 audited net loss being 8% higher than the unaudited version.

- Potential upside catalysts: Stronger-than-expected consumer spending; private placement at BHX that could unlock its equity value.

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