- We increase our target price (TP) for PVS by 15% to VND38,000/share but downgrade our rating from BUY to OUTPERFORM as the company’s share price has increased 35% over the past three months. Our higher TP is due to our 9% higher aggregate 2023-2027F reported NPAT-MI (respective increases of 14%/3%/2% for 2023/2024/2025).

- We increase our 2023-2027F aggregate reported NPAT-MI by 9% as we raise our 2023-2027F aggregate profits from FSO/FPSO joint ventures (JVs) by 44%, raise our respective 2023-2027F/2023-2030F aggregate mechanical & construction (M&C) backlog assumptions by 3%/14% to USD5.0bn/USD6.3bn, and raise our terminal growth rate from 2% to 3%. We incorporate M&C contracts for the Yellow Camel project (USD283mn) and double the M&C contract value for Block B to USD1bn, outweighing our assumed delays in M&C contracts for LNG terminals and domestic offshore wind farm projects following their recent progress.

- We increase our 2023F NPAT-MI by 14% to VND957bn as we raise profits from FSO/FPSO JVs by 92%, which outweighs our 18% lower projected M&C revenue and 8% higher GA expenses.

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