- We reiterate our OUTPERFORM rating for PTB despite cutting our target price (TP) by 35% as its share price has dropped 36% over the past three months. Our lower TP is due to (1) a 24% reduction in our 2022F-2024F NPAT-MI and lower discounted target P/E of 8.2x vs previously 8.8x. These factors are partly offset by rolling our TP horizon forward to end-2023 from mid-2023.

- The revision in our NPAT-MI forecasts is due to our lower revenue and GPM forecasts as we are more pessimistic about the outlook of customer demand from both the domestic and export markets. We assume Vietnam’s wooden furniture and PTB’s export revenue will remain weak in H1 2023 before recovering, which is in line with the expectation of industry players.

- We forecast core 2022F NPAT-MI (excluding real estate and one-off fire damage recognition) to decline 9% in 2022 from a low 2021 base before recovering 7% YoY in 2023.

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