- We increase our target price (TP) for ACV by 18% but reiterate our MARKET PERFORM rating as ACV’s share price has increased by 11% in the last three months. 

- We adjust our valuation approach from a 100% DCF method to a blend of DCF (70% weight) and EV/EBITDA multiple (30% weight) to mitigate the impact of heavy capex for Long Thanh International Airport (LTA) in 2025-26F and high interest expenses from 2027F onward. We apply an EV/EBITDA multiple of 20.0x, consistent with ACV’s 2017-2024 average (excluding 2020-2022). We believe ACV merits valuation multiples at least equal to its historical average.

- Our higher TP is due to rolling our TP horizon forward from mid-2025 to end-2025 and lowering our beta from 0.9 to 0.8, in line with ACV’s 5Y average. This outweighs an 8% reduction in our 2025-38F aggregate NPAT-MI forecast.

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