[BSC Vietnam] APEC In This Week Of 2017 (PME) 06.11.2017 (DELAYED)

Nov. 13, 2017 1:04 AM ET|Includes: VanEck Vectors Vietnam ETF (VNM)

Summary

  • As we mention 2 months ago about “commodity rush” in our email, US crude oil did rise steadily to settle at $54.54/bbl yesterday; which push the Oil & Gas sectors of Vietnam
  • Indexes, VN-Index +0.64%,  Trading value: VND 6773.5 bil ~ 301.4 USD mil, Foreigner transaction Net: 2.01 mil USD
  • Pymepharco (PME) is planned to list on HOSE at price of VND 68,000/share, which is equal to P/E of 15.3x, quite attractive compared to other Pharma stocks including DHG, IMP, TRA.
  • The APEC economic Leader will meet in Danang from 06th Nov to 11th Nov APEC cover 39% of world population and 57% of world GDP. Top meeting of APEC will be in general good to push for economy integration.
  • Most Blue chips and large cap had clear drag down, except VIC, VCB, VNM, MBB, FPT, MSN VIC, VPB, VJC, ACV and ROS (to some extent HPG, MWG, BID, PNJ, ACB and HPG too)

Dear Valued Clients and Partners

  • As we mention 2 months ago about commodity rush in our email, US crude oil did rise steadily to settle at $54.54/bbl yesterday; which push the Oil & Gas sectors of Vietnam recently to 6 month high (and 2.5 years high for GAS). Today, Energy and material again lead the rise of the sectors by +1.65%; followed by finance (+1.60%), utilities (+1.35%)… On the minus side, Industry finished as the only loser of -0.42%.

Today’s Markets:

·         Indexes, VN-Index +0.64%, HNX-Index +0.70%, Upcom +0.97%

·         Active: HOSE: FLC, PVD, SBT, HAG, HQC.  HNX: SHB, PVS, KLF, CEO, PVX.

·         Foreigner, Buy:NT2, VNM, HPG, BID, CTD. Sell: PVD, MSN, VCB, HSG, KDC.

·         Notice stocks: VNM, SBT, PVD, FPT, PVS, SHB, VCS

·         Trading volume: ~206.1 million shares

·         Trading value: VND 6773.5 bil ~ 301.4 USD mil thanks to put through of 16 mil TRA (USD 104.72 million)

·         Foreigner transaction Net: 2.01 mil USD Sell 120.00 USD million and Buy 122.01 USD million

·         Derivative market: VN30F1711 838; VN30F1712 840; VN30F1803 841.6; VN30F1806 843.6, Trading value: VND 1,433 billion ~ USD 63.77 million

Corporate update:

 

·         Pymepharco (PME) is planned to list on HOSE at price of VND 68,000/share, which is equal to P/E of 15.3x, quite attractive compared to other Pharma stocks including DHG, IMP, TRA, DMC and DBD (median P/E of 18.51x ) which is the hottest sectors in the last 2 years (with M&A and sky high stocks price). Our analyst had a visit to PME last week and noted:

PME is the second largest Western drugs producer in revenue (after DHG) and the leader in operational efficiency. The firm famous for high quality drugs. PME currently owns 46 bioequivalence products, and expected 30 bioequivalence drugs. PME is a franchise producer for big pharmaceutical firms such as Stada (Geermany), EG Labo (France), EuroGenerics (Begium), Formapharm (Serbia). Some outstanding dugs for specific treatment are Cephalexin, Cefuroxim, Cafadroxil, Cefixim, Cefalor, Ceftazidime, Cepodoxim, Atorvastatin. Competitive advantage from its GMP-EU standards production line (Cephalosporin antibiotic capsules production line). The company expects to receive GMP-EU certificates for its injections factory in 2017 (which only operate at 1% capacity), and plans to build a new GMP-EU standards Non-betalactam factory with 1.2 billion pills capacity in 2019. GMP-EU is a strict and important certificate in pharmaceutical sector which allows the company to participate in higher value procurement lot 1 and 2. Our analyst expects the company’s revenue and profit margin to accelerate after getting GMP-EU certificates.

Financial results. 9M2017, Net Revenue and PAT of the company reached VND 1,200 billion and VND 215 billion, which is 74% of its annual plan for 2017. Net Profit Margin from operation reached 22% in 9M2017. The firm estimate Net Revenue and PAT respectively are VND 1,616 billion (+7% yoy) and VND 290 billion (+21% yoy) in 2017 and sets its annual net revenue and PAT growth rates to be 15% annual during 2017-2019.

 

Comments:                                             

 

·         The APEC 2017 with the theme of “Creating “new dynamism” for economic growth and integration”. The Asia-Pacific Economic Cooperation (APEC) is a regional economic forum established in 1989 to leverage the growing interdependence of the Asia-Pacific. APEC’s 21 members aim to create greater prosperity by accelerating regional economic integration. This weeks, The APEC economic Leader will meet in Danang from 06th Nov to 11th Nov APEC cover 39% of world population and 57% of world GDP. Top meeting of APEC will be in general good to push for economy integration. I cannot think of any specific stocks can benefit directly from the great event. How s about you (link)

·         I have a bad habit of taking 1 or 2 weeks off every year. During that week, I will disconnect with the market which means that I would check no email, see no tickers, read no news and take no call or reply to no SMSSo forgive me if I did not response to you timely. Back to the market, I am almost happy that I did not suffer last week pullback. Most Blue chips and large cap had clear drag down, except VIC, VCB, VNM, MBB, FPT, MSN VIC, VPB, VJC, ACV and ROS (to some extent HPG, MWG, BID, PNJ, ACB and HPG too). The rest looks vulnerable.

 

Cheers

 

Long Tran

 

https://seekingalpha.com/instablog/13489352-long-tran-thang/5070206-bsc-vietnam-apec-week-2017-pme-06_11-2017-delayed

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