Some stocks to watch on June 12

Hold recommendation for POW stock

According to BIDV Securities Company (BSC), the POW stock price of PetroVietnam Power Corporation has increased by 19% since BSC's latest recommendation report, so BSC changed its recommendation from buy to hold for POW stock.

>> Stock market commentary June 12: The market is still in a short-term accumulation phase

In 2024, BSC forecasts POW's revenue to reach VND 31,043 billion (an increase of 11% compared to last year), the parent company's after-tax profit is expected to reach VND 2,558 billion (an increase of 138%), of which the main contributions are: Electricity output of Ca Mau 1, 2 and Vung Ang 1 plants increased by 9% and 56% respectively due to high electricity demand, input fuel prices remained low, during the period the plants did not undergo major overhauls; Output of NT2 and NT1 plants decreased by 44% and 19% respectively due to a shortage of supply in nearshore gas fields, requiring waiting for high load to generate electricity; Receiving insurance compensation with the assumption of recording VND 500 billion/year for 2 years.

Some stocks to watch on June 12 (Illustration: KT)

Compared to the previous report, BSC changed some of the following assumptions: Electricity output of Ca Mau 1, 2 and Vung Ang in 2024 increased by 10% and 4% compared to the previous forecast thanks to gas and coal prices being lower than expected and load in the first 5 months of the year growing by 14%, exceeding the expected growth of 9%.

In addition, financial revenue increased by 100%. In the previous report, BSC did not include insurance compensation in the valuation because there was a risk that POW would not receive this amount.

Business outlook for 2024/2025: Ca Mau 1, 2 and Vung Ang 1 plants are mobilized more due to increased load; Hydropower output is forecast to grow in the second half of 2024 thanks to La Nina; NT2 plant is expected to receive more gas in 2025 thanks to BOT thermal power projects no longer being covered by gas; NT3 and NT4 plants may lose about VND100 - 375 billion in the first year of operation (2025) and improve in the following years; Receive insurance compensation of about VND1,000 billion - VND700 billion higher than expected in the previous report.

Buy recommendation for PVD stock

According to KB Securities Vietnam (KBSV), the revenue of the first quarter of 2024 of the Petroleum Drilling and Well Services Corporation (stock code PVD) increased sharply by 43.1% over the same period. The drilling service segment increased by 27% thanks to a 34% increase in freight rates and additional revenue from rented rigs. Gross profit margin improved from 19.4% to 25.7% mainly due to a sharp increase in freight rates while the depreciation cost component in the cost of goods sold is estimated to decrease by 11%.

KBSV maintains its view that performance will remain high for at least the next two years as the number of jack-up rigs over 30 years old accounts for 32% of the total number of rigs, while the number of new orders/total number of rigs (orderbook/fleet) accounts for only 3.9% (31.1% in 2014). Jack-up rig rental rates are also expected to remain high during this period.

PVD plans to invest 90 million USD in a 10-year-old jack-up rig that is expected to be put into operation in early 2025. Currently, PVD has had to change its target to another rig because the restart time of the original target is too long, making it difficult to ensure the right schedule for customers. KBSV still expects PVD to be able to put the new rig into operation in the first quarter of 2025.

KBSV uses a combination of the discounted corporate cash flow method (FCFF) to give a buy recommendation for PVD shares with a target price of VND38,100/share, equivalent to an upside of 18.7% compared to the closing price of VND32,100/share on June 11.

Buy recommendation for GMD stock

Also according to KBSV, in the first quarter of 2024, Gemadept Corporation (stock code GMD)'s net revenue reached VND 1,006 billion (up 11%), completing more than 25% of the planned revenue. Of which, the core port operation contributed VND 843 billion (up 29%). GMD's after-tax profit in the first quarter of 2024 increased by 157% to VND 656 billion because GMD recorded an extraordinary profit of more than VND 335 billion from the divestment of Nam Hai Port during the period.

Some stocks to watch on June 12 (Illustration: KT)

The throughput of the entire GMD port system in 2024 is expected to grow by 10-12% compared to 2023 due to the positive outlook for import-export activities from now until the end of the year, new service routes being continuously deployed and the continuous improvement of GMD's port exploitation capacity.

In the first quarter of 2024, GMD adjusted service rates across the entire port system by 3-10% depending on the type of service. With Circular 39/2023/TT-BGTVT on adjusting the price framework for seaport services taking effect from February 15, 2024, GMD's room for increasing seaport rates has been expanded. Service rates in the North and South of GMD are expected to grow by 5% and 7-10% respectively compared to the average level of 2023.

Based on the business outlook and valuation results, KBSV recommends buying GMD shares with a target price of VND100,600/share, 15.8% higher than the closing price on June 10.

Source: https://vov.vn/thi-truong/chung-khoan/mot-so-co-phieu-can-quan-tam-ngay-126-post1100945.vov