Some stocks to watch on August 21

>> Stock market commentary August 21: The market may correct

Buy recommendation for PLX stock

Vietcap Securities Company (VCSC) raised its target price for Vietnam National Petroleum Group (stock code PLX) by 8% to VND59,600/share and maintained its buy recommendation. VCSC's higher target price comes from VCSC's 8% increase in its forecast for profit after tax (PAT) after minority interests (MIL) reported for the period 2024-2028 (changes of +10%/+7%/+7%/+8%/+8% for 2024/2025/2026/2027/2028, respectively). VCSC's target price corresponds to a P/E multiple of 20.0/15.0x for 2024/2025, respectively, compared to PLX's 5-year average P/E of 20.3x.

VCSC increases NPAT after minority interest forecast due to 0.4% higher sales volume assumption, as VCSC believes that reputable petroleum distribution enterprises such as PLX will have a good advantage in the trend of tightening regulations on petroleum trading and assumes 2.8% higher gross profit/liter, based on higher than expected gross profit margin in 2Q24.

Some stocks to watch on August 21 (Illustration: KT)

VCSC forecasts reported NPAT after minority interests to increase 47% YoY in 2024 due to a 4.1% YoY increase in domestic sales volume and a 14% YoY increase in gross profit/litre, offsetting an estimated VND300 billion loss from the divestment from Petrolimex Laos.

Buy recommendation for FRT stock

VCSC increased the target price for FPT Digital Retail JSC (stock code FRT) by 4% to VND220,800/share and maintained the buy recommendation.

VCSC’s higher target price is mainly due to VCSC’s 28% increase in FY24-28F operating profit forecast for FPT Shop as we expect improved operating efficiency from product mix adjustments towards higher gross margin products and closure of underperforming stores in FY24.

VCSC doubles our 2024 NPAT after minority interest forecast to VND240bn as we reduce our FPT Shop net loss forecast by 64% to a loss of VND59bn. As a result, VCSC raises our 2025/2026 NPAT after minority interest forecast by 20%/10%.

Buy recommendation for VPB stock

According to KB Securities Vietnam (KBSV), in the second quarter of 2024, Vietnam Prosperity Joint Stock Commercial Bank ( VPBank , stock code VPB) had net interest income of VND 12,408 billion (up 9.6% compared to the previous quarter, up 41.6% over the same period); total operating income reached VND 16,128 billion (up 20.3% compared to the previous quarter, up 26.2% over the same period). The highest provision expense in the last 8 quarters, reaching VND 8,313 billion (up 44.3% compared to the previous quarter, up 28.1% over the same period) made pre-tax profit reach VND 4,483 billion (up 7.2% compared to the previous quarter, up 71.6% over the same period).

Some stocks to watch on August 21 (Illustration: KT)

KBSV expects VPB's NIM to recover in the remainder of 2024, driven by both deposits and lending. In which, input costs (COF) will improve based on: Maturity of high-interest deposits, VPB will maintain deposit interest rates at 5.5 - 6.0%/year, which is a relatively low interest rate compared to the past. The downward trend in average output interest rates will gradually slow down due to increased credit demand in the second half of the year and improved asset quality.

In the second quarter of 2024, FE Credit returned to profit, with an estimated pre-tax profit of VND 145 billion compared to a loss of VND 853 billion in the previous quarter. FE Credit's recovery comes from improved NIM and signs of improvement in asset quality. If FE Credit returns to profit, it will contribute significantly to VPB's profit growth this year, as in 2023 FE Credit lost VND 3,698 billion, equivalent to 13.5% of the parent bank's pre-tax profit (the parent bank owns 50% of FE Credit's capital).

Based on the valuation results, business prospects as well as considering possible risk factors, KBSV recommends buying VPB shares. The target price for 2024 is VND 25,400/share, 37.6% higher than the price on August 19.

Source: https://vov.vn/thi-truong/chung-khoan/mot-so-co-phieu-can-quan-tam-ngay-218-post1115704.vov