According to the report, JPMorgan analysts have set a target price for Masan Group's MSN shares at VND102,000 in December 2024, an increase of about 26% compared to the current price range. JP Morgan commented that MSN is a leading consumer goods group in Vietnam with a diverse consumer product portfolio including spices, instant noodles, energy drinks and processed meat, and is expanding its modern retail network.
Masan has become the leading consumer goods group in Vietnam.
Compared to China and Thailand before 2010, the analysis team believes that the consumer market in Vietnam is at a "golden time" for modern trade development and has great valuation potential in the future. The difficult consumer market in the first half of the year is a good buying opportunity for this stock's attractive growth story for many years to come.
The report stated: Masan Group (MSN) is in a leading position in a large and potential retail market. The modern retail market in Vietnam has a low penetration rate of 12% compared to 20-45% in ASEAN member countries, and has a moderate level of using marketing channels to create competitive advantages compared to the region.
Since taking over the business from Vingroup in 2019, MSN has increased its market share in modern trade retail by 7% (surpassing Co-op, an unlisted company, to become the market leader by 2022). At the same time, the unit has improved its EBITDA margin by up to 10%.
Masan’s recent capital allocation efforts are aimed at more clearly positioning itself as a consumer-centric company, with investments in supporting ecosystems. Through M&A in the consumer-related business and divestment from the animal feed business in 2021, the company’s consumer-related projects and assets have increased from ~30% in 2015 to 44% in 2022. From a revenue perspective, the consumer-related business segment has increased from 43% in 2015 to 94% of revenue in 2022.
This makes Masan stock one of the best representations of Vietnam’s compelling consumer story. Historically, MSN’s stock price has been closely correlated with the VNI, with a price correlation of 0.92x since 2017.
The fair price given by JPMorgan for December 2024 is VND102,000/share according to the SOTP method (sum-of-the-parts: A company valuation method in which each subsidiary of a company or business unit is valued separately and then all are added together to create the total value of the company).
JPMorgan expects a target P/E ratio of 34x for 2024, a valuation premium of about 40% to regional peers, supported by potential annual EPS growth of 36% from 2023 to 2025.
"We believe that MSN is building a strong consumer ecosystem, helping to increase customer market share, and the company is positioning itself as one of the outstanding representatives of the Vietnamese consumer industry. We are optimistic about the growth opportunities in the modern retail sector, where MSN leads in the number of points of sale and continues to expand market share," JPMorgan's analysis report stated.
Source: https://thanhnien.vn/jp-morgan-dinh-gia-co-phieu-tap-doan-masan-hon-100000-dong-den-cuoi-nam-2024-185230721150334925.htm
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