- We increase our target price (TP) for BWE by 2% to VND52,600/share and maintain our OUTPERFORM rating. Our higher TP is due to a roughly 55% higher valuation for BWE’s stake in associated companies, which is mainly due to the contribution of Tan Hiep Water JSC (THW), outweighing a 14% decrease in BWE’s stand-alone valuation (due to a 14.3% decrease in our aggregate NPAT-MI forecast for 2025-2029F, respective changes of -23%/-11%/-9%/-12%/-19% for 2025/26/27/28/29F). Please see more details on page 10.

- Our lower aggregate 2025-2029F NPAT-MI forecast reflects (1) a ~1.5% ASP reduction from a six-month water tariff hike delay, (2) a three-month delay in the 20% waste tariff hike, (3) higher waste segment cash costs, and (4) increased M&A-related interest expenses. These outweigh a 1% aggregate volume increase and contribution of Tan Hiep Water dividends.

- We forecast a 24% YoY increase in NPAT-MI to VND797bn in 2025, driven by 10% YoY water sales volume growth, a 20% residential waste treatment tariff hike in mid-2025, no FX loss, and a 27% YoY rise in financial income. These factors outweigh the projected ~43% decline in NPAT for the trading & others segment.

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