Binh Minh Plastics Joint Stock Company – Outperform (BMP : HSX – Plastic Pipe)

Binh Minh Plastics Joint Stock Company – Outperform (BMP : HSX – Plastic Pipe)

 

  • HSC’s final FY2018 guidance for BMP suggests net sales will come to VND 3,896 billion (+1.9% y/y) and that PBT then will come to VND 531.7 billion (-8.9% y/y).

 

  • We expect the top line will be mainly supported by a modest increase of 0.5% growth in sales volume and 1.4% hike in ASP.

 

  • The increase in SG&A coupled with the depressed GPM will likely pull the bottom line down a little bit.

 

  • BMP is the leading domestic maker of plastic pipes including PVC, HDPE and PPR in Vietnam with a 27-30% market share in FY2018.

 

  • For FY2019, HSC forecasts net sales of VND 4,072.7 billion (+4.5% y/y) and a pre-tax profit of VND 600.4 billion (+12.9% y/y).

 

  • We have revised down our fair value price to VND 58,080 valuing the company at a FY2019 P/E of 11 xs from the previous fair price of VND 71,270 mainly given the reduction in fair value P/E from 12.5 to 11 times.

 

  • Reiterate Outperform.

 

 

 

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