[BSC Vietnam] Wake Me Up When September Ends (NTP) 02.10.2017 (Delayed)

Oct. 5, 2017 4:42 AM ET

Summary

  • Vnindex opened the last quarter of 2017 with a slightly drop
  • NTP (VND 72,500/share, + 1.4%, Mkt Cap $290 Mil) NTP, one of the biggest construction plastic company is in our top pick stocks list. Catalyst divestment and FOL expansion
  • 9 months GDP 6.41% ( QIII 7.46%); average CPI 3.79%, Credit growth ~ 11%, Net import USD 442 mil, FDI US$ 12.5 bil (up 13.4% yoy); PMI sept 53.3
  • Investment topics “New kid on the Blocks” is one of our key investment theme for 2 years.  IDICO one of the biggest SOE in industry zone is oversubscribed 5 times
  • “Divesting theme” speed up again with not only the Government ( VNM, SAB, BHN…); but also other investors with HDG (ministry of Defense Divestment), NTP (Nawaplastic divestment) …

Vnindex opened the last quarter of 2017 with a slightly drop day while VN30F1710 closed at 788.3 (November VN30 future). It seems that not only FA stocks but also most speculative stocks suffered loss today. In term of sectors, IT lagged the index with -0.98% loss, followed by finance (-0.79%), real estate (-0.71%). Most other sector fluctuate in narrow range.

Today’s Markets:

·         Indexes, VN-Index-0.27%, HNX-Index -0.13%, Upcom -0.40%

·         Active: HOSE: FLC, HQC, HPG, DXG, FIT.  HNX: KLF, PVX, SHB, PVS, SHS.

·         Foreigner, Buy: VIC, CII, VJC, VCB, DPM. Sell: HSG, GMD, MSN, DRC, VNM.

·         Notice stocks: HPG, GMD, NKG, SHS, PVX, VC3

·         Trading volume: ~171.44 million shares

·         Trading value: VND 3255.95 bil ~ 144.91 USD mil

·         Foreigner transaction Net: 1.27 mil USD Sell 6.25 USD million and Buy 7.52 USD million

Corporate update:

 

·         NTP (VND 72,500/share, + 1.4%, Mkt Cap $290 Mil) NTP, one of the biggest construction plastic company is in our top pick stocks list here. our analyst is quite bullish with the stock and target NTP at VND 89,000 /share.

·         NTP’s capacity is 122,000 tons similar to BMP’s capacity of 123,000 tons while NTP’s OPM of 11% (2016) is way lower than BMP OPM of 24%. One of the main reason is NTP’s expenses to distribution agent is way higher than rival’s. Cost to distributors/revenues up to 12%, and 10% higher than EBT last year. Our analyst expect when SCIC and Nawaplastic finished their divestment, NTP managers will be the sole biggest shareholders. Hence, business result could improve significantly from here.

·         Catalyst: divestment of NTP and FOL expansion. It seems that the fist has been happening with Nawaplastic announcement of selling over 21 mill stocks. NTP leaders and NTP South company announced to buy around 6.8 million stocks which is close to the accumulate put through of NTP last week. Rumors says the rest will also be bought by NTP managers.

 

Comments:                                                         

 

·         Wake me up When September Ends. Investors now question the 9 months GDP growth which is estimated at 6.41% (thanks to QIII rise of 7.46%); average CPI climb to 3.79% yoy (sept + 0.59%), Credit growth ~ 11%, Net import USD 442 mil (export USD 154 mil +19.8%, import USD 154,5 + 23.1%); 9 months FDI disbursement was estimated at US$ 12.5 billion, up 13.4% yoy (the biggest flows are from Korea, Japan and Singapore, and to top sectors including manufacturing, Electricity and wholesale/retail); PMI sept at 53.3; foreign visit rise 28.4% to 9,5 million people.

·         Investment topics“New kid on the Blocks” is one of our key investment theme for 2 years (link), seem to gain some speed now. IDICO one of the biggest SOE in industry zone is oversubscribed 5 times, the Vietnam Rubber group (Mother Company of natural rubber stocks) also announce the IPO plan in 2017. At the same time “Divesting theme” speed up again with not only the Government ( VNM, SAB, BHN…); but also other investors with HDG (ministry of Defense Divestment), NTP (Nawaplastic divestment) … while the list getting longer as the Government want to divest more shares in VEAM, SongHong, SongDa, HanCorp, Viwaseen, Coma, VNCC, Fico, CC1 … market is getting more and more interesting.

Cheers

 

Long Tran

https://seekingalpha.com/instablog/13489352-long-tran-thang/5051168-bsc-vietnam-wake-september-ends-ntp-02_10-2017-delayed

 

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