- 2024-05-03T00:00:00
- Company Research
SSI released its consolidated results for Q1 2024 with net profit of VND764bn (USD31mn; +52% YoY), fulfilling 25% of our FY2024 forecast. Q1 2024 operating income (defined to include gains but not losses on the principal book) increased 32.5% YoY to VND2.0tn (USD79mn), completing 23% of our full-year forecast, with gains from FVTPL as the key growth driver, accounting for 46% of total operating income. We attribute this to SSI allocating 60% of its total assets to FVTPL assets, mainly certificates of deposits and bonds. Additionally, Q1 2024 operating expenses increased by 51.7% YoY – higher than the increase in operating income that resulted in a 3.8 ppts decrease in GPM (69.8% in Q1 2024). 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.
- Q1 2024 consolidated PBT from principal investment increased 28% YoY and 33% QoQ, accounting for 54.2% of SSI’s PBT.
- Q1 2024 gains from HTM investments (which include deposits and certificates of deposit with terms of less than one year) decreased 5.7% YoY and 7.5% QoQ amid a decrease in HTM balance and lower interest rate environment.
- Q1 2024 brokerage revenue increased 74.9% YoY following a 2.0x YoY increase in Q1 2024 average daily trading value (ADTV) to USD962mn from USD484mn in Q1 2023. On a QoQ basis, Q1 2024 brokerage revenue increased by 20% QoQ. The commission rate was maintained at 0.18% over the past five quarters. However, we estimate that SSI lost market share on three trading venues combined in Q1 2024 to 8.8% from 9.0% in Q4 2023 and 10.8% in Q1 2023. SSI has recently launched a zero brokerage fees promotion for new customers for one year, which we believe will have a positive impact on SSI’s brokerage market share in the remainder of the year.
- In Q1 2024, SSI’s margin lending book increased 58% YoY and 16% QoQ due to a lower interest rate environment and the positive movement of the market, which we believe could encourage customers to use more leverage.
SSI’s consolidated Q1 2024 results
VND bn | Q1 2023 | Q1 2024 | YoY |
Operating income | 1,489 | 1,973 | 32.5% |
Gains from FVTPL | 688 | 910 | 32.3% |
Gains from HTM | 112 | 106 | -5.7% |
Gains from AFS | 0.1 | 2 | 2828.9% |
Margin lending revenue | 338 | 447 | 32.0% |
Brokerage revenue | 257 | 449 | 74.9% |
Commission rate | 0.18% | 0.18% | 1.0% |
IB revenue | 18 | 9 | -51.6% |
Others | 76 | 50 | -33.9% |
Operating expenses | 393 | 596 | 51.7% |
Loss from FVTPL | 73 | 167 | 127.8% |
Expenses for brokerage | 252 | 348 | 37.8% |
Others | 67 | 82 | 21.5% |
Gross operating profit | 1,097 | 1,377 | 25.5% |
Financial income | 19 | 40 | 109.2% |
Gains from affiliates/ divestments | 9 | 22 | 150.7% |
Financial expenses | 422 | 391 | -7.3% |
Borrowing costs | 392 | 383 | -2.3% |
G&A expenses | 77 | 83 | 8.7% |
Net other income | 0.4 | 0.5 | 12.7% |
PBT | 618 | 943 | 52.6% |
NPAT | 503 | 764 | 52.0% |
Margin lending book | 11,118 | 17,570 | 58.0% |
GPM % | 73.6% | 69.8% | -3.8 ppts |
NPM % | 33.8% | 38.7% | 5.0 ppts |
Source: SSI, Vietcap (units are in VND bn unless otherwise stated)
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