- We raise our target price (TP) for PLX by 8% to VND59,600/share and maintain a BUY rating. Our higher TP driven by our 8% higher aggregate 2024-2028F reported NPAT-MI forecast (respective changes of +10%/+7%/+7%/+8%/+8% for 2024/25/26/27/28F). Our TP implies 2024F/25F P/Es of 20.0x/15.0x, respectively, vs PLX’s historical 5Y average P/E of 20.3x.

- Our higher aggregate NPAT-MI forecast is due to (1) 0.4% higher sales volume assumption, as we expect stricter regulations on petroleum distribution to favor PLX, and (2) a 2.8% higher gross profit/liter assumption, following stronger-than-expected GPM in Q2 2024.  

- We forecast 2024F reported NPAT-MI to grow by 47% YoY due to (1) a 4.1% YoY increase in domestic volume, and (2) a 14% YoY increase in gross profit/liter, which outweighs our estimated VND300bn loss from the divestment of Petrolimex Laos.

- We forecast 2025F reported NPAT-MI to grow 34% YoY and core NPAT to grow 26% YoY based on stable volume growth of 4.1%, the full-year impact of higher regulated cost since July 4, 2024, as well as the slight positive impact of new petroleum regulations to allow petrol distributors to set their own prices. The Ministry of Industry and Trade (MoIT) plans to submit this new decree to the Government within Q3 2024.

Powered by Froala Editor