[BSC Vietnam] September In A Minutes (PVI) 09.10.2017 (DELAYED)

Oct. 11, 2017 12:03 AM ET

Summary

  • The samurais (Banks) led the index today as 10/11 banking stock were on the green, VN-Index +0.14% Trading value: 196.09 USD mil
  • PVI (VND 32,800/share, -0.3%, Mkt Cap $331 Mil) PVI, one of the biggest nonlife insurance (18% market share), with P/E Forward 19.1x – P/B forward 1.1x way below the peers
  • September in a minutes. Vnindex and HNindex + 2.77%, +3.64% (MOM) and 20.99% and 34.37% (ytd). Market capitalization USD 99.37 billion; The P/E 16.06 and 12.74
  • TA updated. Our TA Keep the forecast scenario in the half-year report of 2017, whereby the VN-Index could reach 820- 850 points at the end of the year

Dear Value clients and partners,

  • The samurais (Banks) led the index today as 10/11 banking stock were on the green. The best sectors of today were material (+1.11%) and consumer discretionary (+0.95%) thanks to HPG (+1.5%) and MWG (+1.3%). Energy and utilities sector lagged the index by – 0.45% due to -5% decline of wti last week.

Today’s Markets:

  • Indexes, VN-Index +0.14%, HNX-Index +0.71%, Upcom +0.08%
  • Active: HOSE: FLC, HAI, MBB, FIT, HQC.  HNX: SHB, KLF, ACB, VCG, PVS.
  • Foreigner, Buy: HPG, QCG, DPM, SBT, CII. Sell: VJC, VCB, KBC, VNM, MSN.
  • Notice stocks: MBB, FLC, SSI, VCB, SSI, VJC
  • Trading volume: ~226.08 million shares
  • Trading value: VND 4405.99 bil ~ 196.09 USD mil
  • Foreigner transaction Net: -19.82 mil USD Sell 24.88 USD million and Buy 5.06 USD million
  • Derivative market: VN30F1710 799; Trading value: VND 686.6 billion ~ USD 30.6 million

Corporate update:

 

  • PVI (VND 32,800/share, -0.3%, Mkt Cap $331 Mil) PVI, one of the biggest insurance company (18% market share in nonlife insurance) is in our top pick stocks list here. Our analyst is quite bullish with the stock and target PVI at 40,000 VND/cp (+20.1% upside) with P/E Forward 19.1x – P/B forward 1.1x way below the peers. Report here

Sales growth won’t recover that much from Oil & Gas industry but the sector is near it’s bottom. Last year total revenue down 10%, with revenue from PVN down 60% vs +14% other sectors.

Core business could bottom in 2016-2017 and 2018’s improvement comes from (1) the acceleration of claim provision and investment provision in 2015 and 2016; (2) Strong cash inflow from the divestment of life-insurance segment in 2015 and 2016 (~ VND 700 Bil/year). Moreover, PVI has high quality assets thanks to strong provision in 2016 (250 bil) and 2015 (150 bil)

Catalyst: FOL raised to 100% in the AGM, PVN divestment, abnormal earning: PVI Tower – VND 1,000 Bil book value and estimated VND 350 Bil of PBT with market price. PVI also can sell other projects, including costa Nhat rang.

 

Comments:                                                         

 

  • September in a minutes. Vnindex and HNindex climb 2.77% and 3.64% (MOM) and 20.99% and 34.37% (ytd). Market capitalization reached USD 99.37 billion (excluded USD 20 billion of Upcom index) while daily liquidity was around USD 173 million (ytd). Foreigner net sold closed to USD 30 million and net bought USD 625 million ytd. The P/E of VN-Index and HNX-Index slight reduce to 16.06 and 12.74 respectively.
  • TA updated. Our TA Keep the forecast scenario in the half-year report of 2017, whereby the VN-Index could reach 820- 850 points at the end of the year, the following scenarios:
  • In the positive case, VN-Index will continue to conquer the new peak with the support of Bluechips and circulate among large group of industries such as Banking, Real Estate, Consumer, and Manufacturing. The policy of act of easing monetary policy can help liquidity recover. Bank stocks, large shares of state-owned divestments will remain the mainstay of the market.
  • In the negative case, VN-Index returned to below 780 points when there was negative information in the country and internationally. At the same time, foreigners turned net sellers along with the trend in the regional markets.

Cheers

 

Long Tran

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