SIP - Conservative guidance for 21% YoY decline in 2024G PAT – AGM Note
  • 2024-04-26T00:00:00
  • Company Research
  • We attended SIP’s annual general meeting (AGM) on April 26.
  • Shareholders approved management’s 2024G guidance for revenue of VND5.4tn (USD216mn; -19% YoY) and PAT of VND793bn (USD32mn; -21% YoY). SIP’s 2024G PAT guidance is equivalent to 80% of our forecast. However, we note that SIP tends to set conservative guidance as SIP’s actual NPAT completed 175%/151%/133% of its 2021/22/23 respective guidance.  
  • Shareholders approved (1) FY2023 dividends including VND1,600/share in cash (VND1,000/share was paid in December 2023) and a 15% stock dividend, and (2) a FY2024 dividend of at least 10% on par value.  
  • SIP stated at the AGM that Q1 2024 preliminary revenue increased 30% YoY to VND1.8tn (USD73mn) and PAT surged 43% YoY to VND257bn (USD10mn), completing 26% each of our respective full-year forecasts. We anticipate no significant changes to our 2024F NPAT-MI forecast of VND915bn (USD37mn; flat YoY), pending a fuller review. 

 Guidance for strong uptick in 2024G IP land sales. While still identifying 2024 as a difficult year, management anticipates an uptick in IP land sales at 47 ha in 2024G (compared to 2023 land sales of ~19 ha and the peak years where IP land sales reached upwards of 100 ha). In addition, the company stated that it secured a 16-ha contract to a logistics company (SEA Logistics Partners - SLP) in Q1 2024 in Loc An Binh Son IP (Dong Nai), implying potentially strong sales & cash inflow outlook. Management’s guidance for IP land sales is broadly in line with our 2024F IP land sales forecast of 50 ha.

SIP aims to fully clear its IP land bank in 2024G. Management expects to receive approval from the local authorities for the compensation of the remaining ~600 ha of site area (~400 ha of leasable area) at the Phuoc Dong IP, and then can start land compensation by Q3 2024G. After this expected land clearance in 2024G, SIP will have fully cleared most of its IP land bank (~1,000 ha of leasable area). 

Recurring income from the ready-built-factories (RBF) and energy segments to contribute to profit growth. Management identifies the growth of the RBF and the energy segments as important contributors to the long-term growth of SIP. For 2024G, SIP aims to lease an additional 43,260 sqm of RBFs and to build an additional 9.6 MWp of solar panel, adding on to its end-2023 portfolio of 8.8 ha in leased RBFs and 48 MWp of installed solar panel capacity.

 

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