SAB [BUY +25.8%] - Strong growth driven by higher volume and profitability

- We maintain our BUY rating as we believe SAB’s solid momentum in gaining market share and increasing profitability will continue. We forecast SAB to generate double-digit earnings growth in 2022F-2024F due to a strong post-COVID-19 economic recovery and the company’s margin-enhancement initiatives.

- We raise our target price (TP) by 6% as we increase our aggregate 2022F-2024F NPAT-MI forecast by 5.3% mainly due to our 9.6% lower aggregate 2022F-2024F promotion expense forecast, which is partially offset by our projected increase in input costs.

- We expect revenue to increase by 35% YoY to VND36tn (USD1.5bn) with NPAT-MI of VND5.1tn (USD223mn; 40% YoY) in 2022F. Consequently, we expect 2022F core EPS to rise 46.2% YoY vs 39.6% previously, which is mainly driven by a post-COVID-19 demand rebound and slower pace of advertising & promotion (A&P) spending in 2022F-2024F.