- 2025-02-03T00:00:00
- Company Research
- Q4 2024: Revenue was VND755bn (USD30mn, -12% YoY) and NPAT-MI was VND154bn (USD6mn, -47% YoY).
- Revenue declined 12% YoY mainly due to real estate sales plunging 85% YoY, outweighing 6% YoY higher energy revenue (driven by respective estimated 3%/2% YoY growth in sales volume and ASP).
- NPAT-MI plunged 47% YoY due to (1) a 6% YoY decrease in gross profit and (2) 4.7x YoY higher G&A expenses ((driven by an estimated VND184bn of provision expenses for Hong Phong 4 (HP4) solar farm due to a potential lower FiT price from EVN)), outweighing (3) 59% YoY lower financial expenses.
- 2024: Revenue was VND2,719bn (USD107mn, -6% YoY, 98% of our full-year forecast) and NPAT-MI was VND577bn (USD23, -13%YoY, 98% of our full-year forecast).
- Revenue expanded YoY mainly due to 47% YoY higher real estate sales, driven by recognizing the estimated 34 units sold from Charm Villa phase 2.
- NPAT-MI declined 13% YoY, in line with our forecast, mainy driven by 61% YoY higher G&A expenses (due to VND203bn of provision expenses booked for HP4, per HDG, ~50% of our estimated total required provision of ~VND400bn). This outweighed 36% YoY lower financial expenses.
- Residential real estate segment: (1) HDG plan to launch sales for Charm Villa phase 3 in 2025 and (2) HDG is waiting for detailed guidance on piloting commercial housing projects on non-residential land, affecting the Minh Long (Thu Duc), Green Lane (District 8, HCMC), and Phan Dinh Giot (Hanoi) projects. (3) To fill in the earnings gap while awaiting non-residential land guidance, HDG seeks to acquire ready-to-construct residential projects due to its ample cash position at ~VND1tn (implying a quick ratio of 1.3x and a positive 2024 net cash change of VND104bn).
- We see slight downside risk to our 2025F NPAT-MI due to (1) potential lower-than-expected hydropower earnings due to a significantly lower YoY capacity-add-on (CAN) price in 2025, and (2) potentially higher-than-expected provision expenses for Hong Phong 4 solar farm (vs our projected VND40bn), pending a fuller review.
- We currently have an OUTPERFORM rating for HDG with a target price of VND31,000/share.
HDG’s 2024 results
VND bn | Q4 2023 | Q4 2024 | YoY | 2023 | 2024 | YoY | % of Vietcap’s 2024F |
Revenue | 862 | 755 | -12% | 2,889 | 2,719 | -6% | 98% |
Real estate | 99 | 15 | -85% | 282 | 414 | 47% | 107% |
Energy | 643 | 685 | 6% | 1,939 | 1,891 | -2% | 98% |
Office leasing & hotel | 117 | 108 | -8% | 421 | 459 | 9% | 100% |
Construction & others | 2 | -52 | N.M. | 248 | -44 | N.M. | N.M. |
Gross profit | 586 | 552 | -6% | 1,723 | 1,589 | -8% | 105% |
Selling exp | -2 | -1 | -37% | -15 | -5 | -66% | 32% |
G&A | -49 | -226 | 361% | -218 | -353 | 61% | 204% |
Operating profit | 535 | 325 | -39% | 1,490 | 1,231 | -17% | 93% |
Financial income | 13 | 19 | 46% | 40 | 57 | 42% | 128% |
Financial expenses | -155 | -64 | -59% | -569 | -367 | -36% | 85% |
In which, interest expense | -111 | -78 | -30% | -487 | -348 | -29% | 91% |
Other non-operating income | 11 | -47 | N.M. | 2 | -41 | N.M. | N.M. |
PBT | 403 | 233 | -42% | 963 | 880 | -9% | 94% |
- Income tax exp | -31 | -25 | -20% | -97 | -127 | 31% | 119% |
NPAT before MI | 373 | 208 | -44% | 866 | 753 | -13% | 91% |
- Minority interest | -84 | -55 | -35% | -201 | -177 | -12% | 75% |
Reported NPAT-MI | 289 | 154 | -47% | 665 | 577 | -13% | 98% |
Source: HDG, Vietcap
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