- 2024-07-31T00:00:00
- Company Research
- VEA released its H1 2024 results, including revenue of VND1.9tn (USD76mn; -3% YoY) and NPAT-MI of VND3.2tn (USD127mn; +2% YoY), achieving 56% and 49% of our respective full-year forecasts. While revenue exceeded our forecast, earnings were in line with our expectations with 4% YoY growth in associate profits, mainly from Honda. We currently see no material risk to our current projection, pending a more comprehensive review.
- In Q2 2024, profit from associates grew 4% YoY while non-operating income (primarily interest income) declined 79% YoY, resulting in flat YoY growth in PBT. Honda Vietnam’s profit (83% of VEA’s Q2 2024 NPAT-MI) rose 17% YoY and surpassed our projection. This gain was offset by sharper-than-expected declines in profits from Toyota and Ford, which dropped by 39% and 63% YoY, respectively. We attribute Honda's solid growth to improvements in the selling prices of its motorbike brands, driven by upgraded and new product contributions to the sales mix, while the two other four-wheeler brands are clearing old models in preparation for new launches in H2 2024.
- Regarding sell-out performance, in H1 2024, passenger car retail sales dropped 6% YoY, an improvement vs the 24% YoY decline in Q1 2024. This result completes 37% of our full-year forecast and is broadly in line with our expectation as we anticipate stronger car volume growth from a low base in H2 2024. Among the key auto producers, Honda posted the most resilient performance in H1 2024 due to sales of its key models City (CKD, Sedan B) and HR-V (CBU, SUV). Additionally, Honda Vietnam’s motorbike sales volume completed 45% of our 2024F forecast and is broadly in line with our expectation.
VEA’s Q2 2024 and H1 2024 results
VND bn | Q2 2023 | Q2 2024 | YoY | H1 2023 | H1 2024 | YoY | H1 2024/ Vietcap 2024F |
Revenue | 974 | 1,024 | 5% | 1,984 | 1,923 | -3% | 56% |
EBIT | 23 | 44 | 92% | 38 | 58 | 54% | N.M. |
Associate profits | 1,571 | 1,628 | 4% | 2,746 | 2,866 | 4% | 49% |
Honda | 1,280 | 1,496 | 17% | 2,285 | 2,666 | 17% | 50% |
Toyota | 100 | 61 | -39% | 205 | 64 | -69% | 118% |
Ford + Others | 191 | 71 | -63% | 256 | 136 | -47% | 28% |
Other non-operating profits | 279 | 202 | -79% | 512 | 438 | -14% | 46% |
PBT | 1,873 | 1,874 | 0% | 3,296 | 3,362 | 2% | 50% |
NPAT-MI | 1,798 | 1,798 | 0% | 3,148 | 3,219 | 2% | 49% |
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Sell-out performances |
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Honda 2W (‘000 units) | 484 | 476 | -2% | 1,004 | 958 | -5% | 45% |
Honda 4W | 5,120 | 4,362 | -15% | 9,488 | 10,481 | 10% | 36% |
Toyota | 13,275 | 15,404 | 16% | 27,420 | 23,025 | -16% | 47% |
Ford | 8,755 | 9,630 | 10% | 17,423 | 17,651 | 1% | 38% |
Source: VEA, Vietnam Automobile Manufacturers' Association (VAMA), Vietnam Association of Motorcycle Manufacturers (VAMM), Vietcap’s estimates
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