DCM shares hit the ceiling price in the first trading session of the week.

Shares of Ca Mau Petroleum Fertilizer Joint Stock Company (stock code: DCM) surged to the ceiling price in the first trading session of the week, reaching 40,100 VND, establishing the highest price since June 2022, along with a sudden increase in trading volume.

Shares of Ca Mau Petroleum Fertilizer Joint Stock Company (DCM) maintained their upward trend throughout the first trading session of the week. Strong buying pressure before the close pushed the share price to the ceiling of 40,100 VND, accumulating 2,600 VND above the reference price. This is the highest price in the last two years, and also represents an increase of approximately 31% compared to the price of 30,700 VND at the beginning of the year (adjusted price).

DCM closed the first trading session of the week with no sellers, and a surplus of buy orders at the ceiling price exceeding 760,000 shares. The massive influx of capital caused the trading value to surge to 680 billion VND, nearly three times that of the previous week's closing session. The volume of shares traded reached over 17.2 million units, ranking fourth on the Ho Chi Minh City exchange, after DXS, VRE, and HPG. This is also the highest trading volume for this stock since March 2022.

After four consecutive selling sessions, foreign investors returned to net buying of 2 million DCM shares today, equivalent to a net value of nearly 82 billion VND. The value of shares accumulated by foreign investors in DCM is second only to VNM, thus contributing to its inclusion in the list of stocks with the most positive impact on the VN-Index.

DCM's upward trend mirrored the performance of the fertilizer sector stocks. Several other stocks, such as BFC, also hit their ceiling price, while DPM and DGC increased by 3.7% and 1.8% respectively compared to their reference prices.

Price and liquidity chart of DCM stock from the beginning of the year to date.

The current price of 40,100 VND for DCM is still lower than the forecasts of some analytical groups. For example, in its report at the end of June, DSC Securities Company expected the target price of this stock for this year to be 43,000 VND.

According to this analysis team, the upward momentum in DCM's share price stems from the company's high likelihood of exceeding its business plan with revenue of approximately VND 14,560 billion and after-tax profit of VND 1,554 billion, representing increases of 16% and 40% respectively compared to last year. The company has supporting factors such as expected market share growth in the Central Highlands and Southeast regions thanks to the acquisition of the KVF plant, the anticipated continued rise in urea prices due to tight supply and reduced depreciation costs, an increase in the proportion of domestic natural gas, and the amendment of the VAT law, all of which will support profitability.

“DCM will exceed its 2024 business plan with the company's prospects stemming from the continued upward trend in urea selling prices from the second half of 2024, estimated to increase by approximately 5-8% compared to the current price. The prospect of expanding domestic and export NPK market share within the ASEAN group, along with factors such as reduced plant depreciation, revised VAT tax laws, and reduced input gas price risks, will help the company's net profit increase by approximately 35-40% year-on-year,” a DSC expert stated.

From a more optimistic perspective, Mirae Asset Vietnam Securities Company projects a 12-month target price of VND 45,000 for DCM. Experts from the company stated that fertilizer prices will improve in 2024 amidst Russia and China's export ban on fertilizers until the end of May, leading to supply shortages.

Ca Mau Petroleum Fertilizer Joint Stock Company aims for consolidated revenue of VND 11,878 billion and after-tax profit of VND 794.8 billion this year. The parent company's equity is projected at VND 9,850 billion. The management stated that the company has accumulated sufficient cash flow to support production and business operations, and therefore has no plans to increase capital for production expansion.

In the first quarter, the company recorded revenue of VND 2,885 billion, an increase of nearly 2% compared to the same period last year. Pre-tax profit reached over VND 382 billion and after- tax profit was approximately VND 350 billion, increasing by 46% and 52% respectively compared to the same period last year. Total assets at the end of the first quarter reached VND 15,743 billion, a slight increase from VND 15,237 billion at the beginning of the year. Liabilities amounted to over VND 5,452 billion, the majority of which were short-term liabilities.

At its annual general meeting last month, the DCM Board of Directors announced that it would allocate approximately VND 1.059 billion to distribute cash dividends at a rate of 20%. The last registration date to receive dividends is June 25th, and payment will be made on July 11th.

Responding to concerns that the dividend payout ratio is low given the amount of cash held and profit targets, Mr. Van Tien Thanh, General Director of Ca Mau Petroleum Fertilizer Joint Stock Company, shared that, given the nature of the fertilizer business with a profit margin of only 8-12%, the annual dividend level as in previous years is considered reasonable.

Source: https://baodautu.vn/co-phieu-dcm-cham-tran-trong-phien-dau-tuan-d219562.html