- 2023-08-10T00:00:00
- Company Research
- We cut our target price (TP) for PLX 3.1% to VND37,800/share and maintain our MARKET PERFORM rating. Our lower TP is mainly due to a 2% decrease in our aggregate 2023-2027F NPAT-MI forecast (-3%/+5%/-2%/-3%/-4% in 2023/24/25/26/27F), which is driven by higher projected SG&A expenses and lower projected financial income following H1 2023 results. These factors outweigh higher regulated costs starting in July 2023 (which have supported petroleum distributors to have higher selling prices) and higher projected sales volume.
- We forecast 2023F reported NPAT-MI to more than double to VND3.4tn. The main drivers for this increase are (1) 14% YoY higher profit per liter, which is supported by the full-year effective base price review in Q4 2022 and regulated cost increases in early July 2023; (2) strong domestic volume of 10.8 million cbm (+3% YoY); and (3) VND548bn of net profit from the PG Bank divestment. We also forecast robust 22% growth in 2024F reported NPAT-MI from the full-year impact of July 2023’s regulated cost increase and our relatively stable petroleum price forecast supporting input cost control as well as gross profit per liter (+6% YoY).
- We forecast a 12% CAGR in reported EPS for 2023-2027F, which is driven by PLX capitalizing on Vietnam's resilient projected petroleum demand growth of 3.4% p.a. in 2022-2027F (per the Government), which is 4x the global growth rate. In H1 2023, PLX's sales volume increased 3% YoY as the company retained the market share it gained in 2022 through its top-of-mind brand name and nationwide distribution network.
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