- We attended TDM’s AGM in Binh Duong Province on March 28. The meeting discussed the company’s 1) 2023 guidance and 2) equity issuance plan. Management expects growth in 2023 despite the risk of an economic slowdown. Additionally, the company is proceeding with its capex plan as it expects its current water plants will be fully utilized in the next two years.
- The AGM approved 2023 guidance for revenue of VND527bn (USD22mn; +10% YoY) and NPAT of VND298bn (USD13mn; +35% YoY), which is based on a water sales volume growth assumption of 10% YoY (compared to our forecast of 13% YoY growth). TDM’s 2023 revenue and NPAT guidance accounts for 95% and 88% of our respective 2023 full-year forecasts — in line with our expectation. We note that TDM has beaten its NPAT guidance by 15% on average in the past six years.
- Shareholders approved TDM to carry out its equity raising plan via a 10:1 rights issue in 2023 (i.e., existing shareholders have the right to buy one additional share for every 10 shares owned). The offering price of VND30,000/share implies total proceeds of VND300bn (USD12.7mn), which will be mainly spent on investing in other water companies, including Can Tho Water Supply Sewerage JSC (UPCoM: CTW) and Ca Mau Water Supply JSC (UPCoM: CMW).