- 2024-07-19T00:00:00
- Company Research
SSI released its parent results for H1 2024 and we estimate the consolidated results as follows.
H1 2024 net profit was VND1.6tn (USD65mn; +51% YoY), fulfilling 55% of our FY2024 forecast. H1 2024 operating income (defined to include gains but not losses on the principal book) increased 34.8% YoY to VND4.3tn (USD171mn), completing 51% of our full-year forecast. Gains from FVTPL were the key growth driver, accounting for 48% of total operating income. We attribute this to SSI allocating 62% of its total assets to FVTPL assets, mainly certificates of deposits and bonds. In addition, H1 2024 operating expenses increased by 67.2% YoY – higher than the increase in operating revenue that resulted in a 6.5 ppts decrease in GPM (66% in H1 2024 vs 73% in H1 2023). This is mainly due to a higher loss from FVTPL. Overall, SSI’s results were broadly in line with our expectations. We see no material changes to our earnings forecasts for SSI, pending a more extensive review.
- H1 2024 gains from FVTL investments continued to be strong at +45.6% YoY, completing 60% of our full-year forecast. Q2 2024 gains from FVTL investments increased 23.2% QoQ. However, we expect this income to slightly weaken in H2 2024 following our expectation that the interest rates will increase in H2 2024.
- H1 2024 gains from HTM investments (which include deposits and certificates of deposit with terms of less than one year) decreased 17.2% YoY amid a decrease in HTM balance and a lower interest rate environment compared to last year, in our view.
- H1 2024 brokerage revenue increased 70.3% YoY following a 66.7% YoY increase in H1 2024 average daily trading value (ADTV) to USD977mn from USD586mn in H1 2023. On a QoQ basis, Q2 2024 brokerage revenue increased by 24.7%. We estimate that SSI maintained its market share on the three trading venues combined in Q2 2024 at around 9%.
- It is notable that SSI pushed corporate bond trading activities in Q2 2024 with the total value of trading bonds by customer increasing 7x QoQ. We estimate that the bond service contributed an additional 16% of brokerage revenue for SSI in Q2 2024.
- In Q2 2024, SSI’s margin lending book increased 52.3% YoY and 16.5% QoQ due to a lower interest rate environment and positive movement of the market, which we believe could encourage customers to use more leverage.
SSI’s estimated consolidated H1 2024 results
VND bn | H1 2023 | H1 2024 (estimate) | YoY | Q2 2023 | Q2 2024 (estimate) | YoY |
Operating income | 3,169 | 4,272 | 34.8% | 1,680 | 2,299 | 36.8% |
Gains from FVTPL | 1,395 | 2,031 | 45.6% | 707 | 1,121 | 58.5% |
Gains from HTM | 246 | 204 | -17.2% | 134 | 98 | -26.9% |
Gains from AFS | 4 | 3.3 | -17.8% | 4.0 | 1.2 | -70.3% |
Margin lending revenue | 699 | 960 | 37.4% | 360 | 513 | 42.4% |
Brokerage revenue | 593 | 1,009 | 70.3% | 336 | 560 | 66.9% |
Commission rate | 0.18% | 0.20% | +2 bps | 0.18% | 0.21% | 19.4% |
IB revenue | 35 | 15 | -58.7% | 17 | 6 | -66.0% |
Others | 198 | 50 | -74.7% | 122 | (0) | -100.3% |
Operating expenses | 856 | 1,431 | 67.2% | 463 | 835 | 80.4% |
Loss from FVTPL | 109 | 562 | 415.6% | 36 | 395 | 1003.6% |
Expenses for brokerage | 565 | 719 | 27.3% | 312 | 371 | 18.8% |
Others | 182 | 151 | -17.2% | 115 | 69 | -40.0% |
Gross operating profit | 2,314 | 2,841 | 22.8% | 1,217 | 1,464 | 20.3% |
Financial income | 46 | 94 | 106.2% | 27 | 55 | 104.1% |
Gains from affiliates/ divestments | 31 | 48 | 54.3% | 22 | 26 | 16.0% |
Financial expenses | 870 | 786 | -9.6% | 448 | 395 | -11.8% |
Borrowing costs | 820 | 735 | -10.4% | 428 | 351 | -17.9% |
G&A expenses | 166 | 134 | -19.4% | 90 | 51 | -43.4% |
Net other income | 1 | 0 | -33.3% | 0 | 0 | -93.4% |
PBT | 1,324 | 2,015 | 52.2% | 707 | 1,073 | 51.8% |
NPAT | 1,070 | 1,618 | 51.2% | 567 | 853 | 50.4% |
Margin lending book | 13,439 | 20,464 | 52.3% | 13,439 | 20,464 | 52.3% |
GPM % | 73% | 66% | -6.5 ppts | 72% | 64% | -8.8 ppts |
NPM % | 34% | 38% | 4.1 ppts | 34% | 37% | 3.4 ppts |
Source: SSI, Vietcap (units are in VND bn unless otherwise stated)
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