Company update – HPG (BUY)

Hoa Phat Group Joint Stock Company – Buy (HPG : HSX – Industrial Metals)


  • HPG has hit 101% of their full year bottom line target in the first 11 months FY2018 already.


  • 11-month-sales volume grew steadily thanks to capacity added.


  • Q4’s prospects look mixed as margins likely to be squeezed.


  • FY2019 targets look impressive calling for 48-69.1% increase in sales volumes of construction steel.


  • FY2018 dividend policy set at a minimum of 30% of par value in stock.


  • For FY2018, HSC is trimming our full-year forecast now calling for net sales of VND 56,781 billion, (+23% y/y) and an NPAT of VND 8,852 billion, (+10.5% y/y).


  • For FY2019, HSC forecasts the company will deliver net sales of VND 70,067 billion (+23.4% y/y) and NPAT of VND 9,765 billion (+10.3% y/y).


  • Our FY2019 fair value price for HPG is VND 43,630 and values the company at a forward FY2019 P/E of 10xs.


  • Reiterate long-term BUY.



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