• Preliminary Q1 2024 results: MWG’s net revenue was VND31.5tn (approximately +17% YoY; flat QoQ), completing 25% of our forecast and is in line with our expectation. TGDD & DMX’s sales grew 10% YoY, implying 4% QoQ growth per our estimate. Management has yet to disclose the net profit, but believes Q1 NPAT is encouraging and in line with its target of VND2.4tn.
• TGDD (including TopZone) & DMX remain conservative on the ICT business outlook in 2024. However, the chains have taken preparatory measures to maintain sales YoY this year. Besides closing unperforming stores, TGDD & DMX has cooperated with consumer finance companies to secure abundant consumer lending quota, favorable interest rates, fast approval process and high approval rate for TGDD & DMX’s customers. Besides closing underperforming stores, TGDD & DMX have cooperated with consumer finance companies to secure a strong consumer lending quota, favorable interest rates, a fast approval process, and a high approval rate for TGDD & DMX’s customers. Management projects no expansion for TGDD & DMX in the next 1 – 2 years.
• BHX maintains its target of full-year net profit in 2024. Management believes profit results in Q1 2024 remain in line with this target. In 2024, BHX will focus on reducing logistic costs, especially for fresh produce. In order to achieve this, BHX is building centralized farming clusters where BHX will secure 100% of the output. In the long term, BHX strives to become the main/highest-frequently purchased channel among modern grocery retailers. Regarding its pricing strategy, BHX will maintain its competitive pricing in the long term, meaning that when the product market prices change, BHX will always offer the most competitive prices to customers.
• An Khang & AVA Kids maintain the targets to reach break-even by YE 2024 for both chains. An Khang will consider store expansion if its operation maintains stable efficiency. An Khang can reach the break-even point when average sales/store increases to VND550mn (USD 22,000) from currently VND450mn (USD 18,000). AVA Kids has no store expansion plan but will focus on increasing its online sales.
• EraBlue aims to become Indonesia’s number one CE retailer in 2024. The chain ended Q1 2024 with 55 stores, in which there are two store formats (the 300-sqm mini store with sales/store of VND4.5bn, and the 180-sqm super mini store with sales/store of VND2.5bn). EraBlue has reached store-level EBITDA break-even and will enter the fast expansion phase after breaking even at the company level. Management reiterates the target of having 500 stores by YE 2027.
• Others: 

- MWG will conduct its share buyback plan regardless of the share price at that time.

- FX risk: MWG’s goods are mainly procured in VND. The long-term USD loan of USD250mn, which is due in September 2025, is already hedged.

- BHX private placement: New investor (i.e. CDH Investments) will support BHX in connecting with other retail partners that CDH has relationships with.

- To optimize operational efficiency, management believes “restructuring” is a process that has come to stay for MWG. Management will review each business every six months - one year to eliminate what is redundant.

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