Mirae Asset Flags 10 Stocks With Potential to Surge Up to 65% in One Year

Mirae Asset Vietnam Securities Company (MAS) has published a list of 10 recommended stocks from 10 sectors with high growth potential over the next 12 months.

These stocks include: VPB with a target price of VND 23,800 per share, an increase of 30%. In addition to the proposal to transfer the weak credit institution, the General Meeting of Shareholders has a few main points as follows: 1) VPB plans to continue the cash dividend rate at 10% for 2023, as in 2022; 2) for 2024, the bank targets a credit growth of 25% (2023: +25.2%); and 3) pre-tax profit is expected to recover strongly with a growth rate of around 114%.

Among the banks under observation, VPB is expected to have the most positive change in terms of profit in 2024 based on its weak business results in 2023. 

GAS has a target price of VND 98,300 per share, a 33% increase: Promising projects such as Thi Vai LNG port and Lot B O Mon gas pipeline will come into operation in 2024 and late 2026, respectively. Revenue in 2024 is estimated at VND 92,926 billion and post-tax profit at VND 11,756 billion. 

Long-term growth potential: Promising projects such as Thi Vai LNG port and Lot B O Mon gas pipeline will come into operation in 2024 and late 2026, respectively, and are expected to contribute significantly to revenue. Besides, PVGAS has signed two documents related to the gas sale and purchase agreement (GSPA) at gas fields in the Southwestern region in early 2024. These projects will help solve the escalating gas shortage in the Southwest region as the cost of gas imports from Petronas to meet the demand of the Ca Mau cluster is increasing.

BWE has a target price of VND 50,600 per share, an 18% increase. Forecast for 2024: In 2024, revenue is expected to increase by 7.1% year-on-year to VND 3,776 billion, while net profit is estimated to recover to VND 757 billion, up 12.3% year-on-year. Overall, revenue and net profit growth in the period 2024-2028 is projected to remain stable at 6.6% and 15.6% per annum. 

NT2 has a target price of VND 25,200 per share, an increase of 13%: Months 5, 9, and 10 of 2024 will have the highest electricity production and Qc contract electricity production (accounting for 67% of the total Qc of the year). Sales in 2024 are forecasted at VND 4,977 billion and the after-tax profit of the parent company’s shareholders is VND 157 billion. The cash dividend rate is estimated at 10%.  

VRE has a target price of VND 32,100 per share, an increase of 41%: The retained earnings after tax as of December 31, 2023, are VND 16,476 billion. During the period 2024 – 2027, VRE will develop an additional 800,000m2 of commercial centers. In 2024, VRE aims for revenue of VND 9,500 billion (-2.9%) and after-tax profit of VND 4,420 billion (+0.2%).

VHM has a target price of VND 63,000 per share, an increase of 53%: VHM is trading at a P/B of 0.96, a discount of nearly 72% compared to the average P/B of the past 5 years of about 3.5. Fluctuations in share prices have somewhat reflected concerns about: (1) the possibility of a slow recovery in the real estate market, (2) increased leverage in recent quarters, (3) increased transactions with related parties of VHM. 

HHV has a target price of VND 21,250 per share, an increase of 65%: In 2024, MAS projects the revenue and net profit of the parent company to be VND 3,231 billion (+20% YoY) and VND 408 billion (+27.5% YoY), respectively, with EPS of VND 992. 

HHV reported revenue in Q1/2024 of VND 690 billion, an increase of 28%, and after-tax profit of VND 114 billion, an increase of 37%. In which, BOT service revenue accounts for 69% and Construction accounts for 28%. The company aims to increase its charter capital by 41.3% to VND 5,816 billion from the current value of VND 4,116 billion through three sources: stock dividend, private placement, and rights offering to existing shareholders.

The capital raised will be used to finance two expressway projects that will commence construction in 2024: Dong Dang – Tra Linh & Huu Nghi – Chi Lang. In Q3/2024, HHV announced the expected contract value for the Dong Dang – Tra Linh Expressway Project: 1) VND 836 billion in the EC contract under the EC01 package (KM0+000 – KM38+000) and 2) VND 86 billion in the EPC contract. The expected implementation time from the date of signing the contract to December 31, 2026.

HPG has a target price of VND 36,400 per share, an increase of 28%: (1) Industry leader with a competitive advantage in HRC production; (2) The declining steel price trend in Q1/2024 is no longer a major concern; (3) High-priced inventories have been processed, and the growth driver from profit margin will be reflected in the next period.

Thanks to the high-priced inventory that was processed in Q1/2024, the growth driver from profit margin will be reflected in the next period. The steel price level has improved above the 3-year average since Q4/2023, and the current price level can be maintained in the coming time due to domestic fundamentals and export opportunities.

In addition, the current downward trend in raw materials prices such as iron ore and coking coal (accounting for ~70% of input costs) will also support the profit margin. As HPG has consumed most of its high-priced inventories in previous quarters, the profit margin will start to increase and operation efficiency will be enhanced in the following quarters of 2024.

VNM has a target price of VND 79,500 per share, an increase of 22%: In 2024, VNM sets a revenue plan of VND 63,163 billion, an increase of 4.4%, and after-tax profit of VND 9,376 billion, an increase of 4%. The total dividend for the year is 38.5% of par value, equivalent to VND 3,850 per share. Using the Free Cash Flow (FCFF) method with several main assumptions: (1) WACC is 11%; (2) the growth rate after 2034 is 3%, MAS values VNM shares at VND 79,500.

Finally, MSH has a target price of VND 48,400 per share, an increase of 6%: MSH’s 2024 revenue forecast is VND 4,800 billion, up 5.7%, and after-tax profit is VND 335.2 billion, up 36.7%. Using the FCFF method to determine the fair value of MSH shares with a required rate of return of 14% and assuming long-term growth of 0% after 2034, MAS values MSH shares at VND 48,400.