- We upgrade our rating for NKG to MARKET PERFORM from UNDERPERFORM as we raise our target price by 13% to VND22,400 per share.

- Our higher target price is primarily because of our improved outlook for NKG, following stronger-than-expected H1 2024 results. We raise our respective 2024/25/26/27/28F NPAT-MI forecasts by 31%/25%/9%/5%/5%, with higher GPM forecasts (HRC input prices fell more than we expected, resulting in strong H1 2024 GPM expansion) which outweigh lower revenue forecasts (as weaker ASP forecasts outweigh stronger sales volume projections).

- We raise our 2024F NPAT-MI by 31% (equivalent to a 467% YoY surge from 2023’s low base) as we (1) increase our 2024F total sales volume forecast by 5% to 1mn tonnes of galvanized steel sheets and steel pipes and (2) raise our GPM forecast by 80bps, which outweigh a 13% cut to our 2024F blended ASP forecast as steel prices declined YTD due to increased competition from Chinese low-priced steel exports.

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