- We raise our target price (TP) for PVS by 12% to VND47,800/share and upgrade our rating from OUTPERFORM to BUY. Our higher TP is due to our 12% higher aggregate 2024-2028F NPAT-MI (respective changes of +3%/+6%/+14%/+9%/+28% for 2024/25/26/27/28F).

- Our higher forecast is mainly due to slightly higher GPM assumptions for the Mechanical & Construction segment following 2023’s audited result, 67% higher backlog assumption for overseas offshore wind for 2024-2030F and doubling day rate for FPSO Ruby 2 in 2025-2026.

- We forecast 2024F NPAT-MI to grow 10% YoY as we forecast M&C revenue to jump ~70% YoY, driven by the recovery of domestic exploration & production, new offshore wind power, and M&C’s GPM assumption to rise to 3.5% vs 1.4% in 2023. We estimate Q1 NPAT of VND187bn (-13% YoY) as the nature of M&C business is having revenues booked mainly in Q4.

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