BID [OUTPERFORM +18.8%] - Scale advantages to sustain strong growth

- We maintain our target price (TP) of VND47,300/share and downgrade our rating for BID to OUTPERFORM from BUY.

- We increase our aggregate 2025-2029F earnings forecast by 2.8% (respective changes of +2.0%/+2.0%/-0.6%/+2.6%/+6.5% for 2025/26/27/28/29F). The increase in our 2025-2029F earnings forecast is mainly due to (1) a 4.3% decrease in aggregate 2025-2029F provision expenses as we expect NPL formation to moderate, and (2) a 2.5% decrease in aggregate 2025-2029F OPEX as we expect BID to gain operating leverage from stronger top-line growth.

- We model for BID to issue 262 million shares (equivalent to 3.8% of shares outstanding at year-end 2024) through two private placements by February 2025 (1.8% of shares; selling price of VND38,800/share, buyers including SCIC and Dragon Capital) and by end-2025 (2.0% of shares; assumed selling price of VND45,000/share). The expected total proceeds are VND10.9tn (USD429mn).