- We downgrade our rating for NLG from BUY to OUTPERFORM and cut our target price by 3.1% to VND34,600/share mainly due to lower valuations for the Can Tho and Izumi City projects as we factor in Can Tho’s social housing subdivision and delay presales of Izumi City to 2024, which are partially offset by the positive effect of rolling our target price forward to mid-2024. NLG’s share price has increased 21% over the last two months.

- We forecast 2023F NPAT-MI of VND607bn (USD25.7mn; +9% YoY), which is mainly driven by (1) deliveries at Southgate, Mizuki Park Phase 2 & 3 (P2 & P3) and Izumi City, (2) the 25% Paragon stake sales and (3) gain from selling a land parcel transfer in the Kikyo Residence (Thu Duc City, HCMC). This is 12% lower than our previous forecast due to our revised assumption for higher financial expenses.

- We forecast 2023F presales of VND5.3tn (USD224.5mn; -35% YoY), which is contributed by Mizuki Park P2 & P3, Akari City P2, Southgate and Can Tho in 2023. We decrease our 2023F presales assumption by 17% as we delay presales of Can Tho’s land plots and Izumi City to 2024, which is partially offset by our expectation that NLG will launch Can Tho’s EhomeS (social housing) in 2023. 

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