[BSC Vietnam] New Bankers On The Block (ACB) 02.01.2018 (DELAYED)

|Includes: VanEck Vectors Vietnam ETF (VNM)

Summary

  • Crude oil benchmarks, Brent and WTI, both started the year above $60 per barrel for the first time since January 2014;Indexes : VN-Index 1.17%; Trading value : VND 6937.7 bil.
  • ACB – TP VND 43,500/share (Mkt Cap $1.617 Bil – Current price VND 38,800/share – P/E FW 11.37x – P/B 2.46x – FOL 30%). NIM was high, at 3.31%.
  • New Bankers on the blocks which we have mentioned the term for a year (link). HDBank (HDB) is expected to list on 5th Jan 2018 with starting price of 33,000.
  • We have mentioned at the end of 2016 link. „The market need a Small correction at the end of 2016, and a big jump in 2017 thanks to New kid on the block (market cap and index performace)”. HDbank is not the only one who will join the listed Bankers (we will have 10 more listed banks).

Dear Valued clients and partners

·         Crude oil benchmarks, Brent and WTI, both started the year above $60 per barrel for the first time since January 2014 while Energy (-1%) and Utilities (-0.76%) stocks encountered a pullback this morning.  The main index was led again by consumer staple (+1.47%) finance (+2.72%) an​d IT (4.44%)

Today’s Markets:

·         Indexes : VN-Index 1.17%, HNX-Index 1.71%, Upcom 0.82%

·         Active : HOSE: FPT, STB, GAS, CTG, CII. HNX: SHB, VGC, MBS, SLS.

·         Foreigner, Buy : MSN, BID, NKG, HPG, HBC. Sell: SSI, VRE, ITC, SCR, VHC.

·         Notice stocks : FPT, STB, PNJ, CTG, CII, ACV, GEX, KDC, SHB, ACB, TCM, FLC.

·         Trading volume : ~ 262.3 million shares

·         Trading value : VND 6937.7 bil ~ 305.6 USD mil

·         Foreigner transaction Net: 11.96 mil USD Sell 12.9 USD million and Buy 24.86 USD million

·         Derivative market: USD 52.25 million; VN30F1801 @999; VN30F1802 @ 1003;  VN30F1803 @ 1011 and  VN30F1806 @ 1034

Corporate update:

 

·         ACB – TP VND 43,500/share (Mkt Cap $1.617 Bil – Current price VND 38,800/share – P/E FW 11.37x – P/B 2.46x – FOL 30%)

·         Strong credit growth of 21.91% (2016), and 12.9% (9M2017). Credit growth rate is expected to continue high. (1) Strong CAR = 13.19% (2016); (2) low ratio of short-term fund used for medium and long-term fund of 24.27%, low pure LDR of approximately 78.83% (9M2017) (the maximum rate required by SBV is 80%).

·         Strong profit growth. 9M2017 EAT = 1,527 bil, + 53%. BSC forecasts that net income will increase by 69% YoY to 2,219 billion in 2017 and by 45% to 3,250 billion in 2018, EPS 2018 of VND 3,245/share

·         NIM was high, at 3.31% in 9M2017 and are expected to continue improving due to (1) promoting transaction banking segment; (2) promoting retail banking segment; (3) boosting the ratio of loans / deposits to 80%; (4) assets sensitive to interest (mainly, 1-3 month- term) brings advantages when interest rate goes up.

·         Good asset quality. NPL ratio = 1.04% (9M2017), the total doubtful assets = VND 10 trillion, 63% of equity. Strong loan loss coverage ratio = 151%, in which, the ratio (excluding loan loss provision of G6) =110%.  (1) Bank plans to repurchase and handle the entire NPL sold for VAMC in 2017 (net value = VND 853 bil). And (2) completion of provision for debt of G6 one year earlier, expected to complete provisioning in 2017 (unsold debts – provision = VND 558 bil, valuable collateral = VND 1,237 bil). Since 2017, ACB no longer make provision for bonds from the G6 (VND 558 billion in 2016).

 Comments:  

 

·         New Bankers on the blocks which we have mentioned the term for a year (link). HDBank (HDB) is expected to list on 5th Jan 2018 with starting price of 33,000 (slightly higher than last offering price). The bank expected EBIT of VND 2,420 billion in 2017, (ROE ~ 15.5%). They will pay dividend of 2017 by share and plan a 10% cash dividend in the coming years. The EBT target is 40% per year over the next five years and ROE is over 26% by 2021.

We have mentioned at the end of 2016 linkThe market need a Small correction at the end of 2016, and a big jump in 2017 thanks to New kid on the block (market cap and index performace)”. HDbank is not the only one who will join the listed Bankers (we will have 10 more listed banks). That is why, for over ayear, our analyst has been very bullish with ACB, MBB, and VCB; closely follow CTG, BID and VPB. Which sector will be the dominant one? now you have your answer. 

Picture of the day 02nd Jan 2018New bankers on the block


Source: BSC

Good nite

Best regards

Tran Thang Long (Mr.)

Head of Research

 

https://seekingalpha.com/instablog/13489352-long-tran-thang/5099937-bsc-vietnam-new-bankers-block-acb-02_01-2018-delayed

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s