HDG – Solid hydropower earnings offset by Charm Villa sales launch delay, impacting our 2024F earnings projection – Earnings Flash
  • 2024-11-01T00:00:00
  • Company Research
  • HDG announced its Q3 2024 results with revenue of VND500bn (USD20mn, +13% YoY) and reported NPAT-MI of VND138bn (USD5.5mn, +63% YoY). The revenue expansion was mainly fueled by 18% YoY growth from the energy segment, primarily driven by strong hydropower earnings. Reported NPAT-MI surged relative to revenue, primarily due to (1) strong top-line growth and GPM expansion from hydropower, and (2) lower interest expenses, which outweighed the YoY doubling of G&A expenses. 

  • For 9M 2024, HDG’s revenue was VND2.0tn (USD79mn, -3% YoY) and reported NPAT-MI remained flat YoY at VND423bn (USD17mn), completing 71%/65% of our respective full-year forecasts. We attribute the slight revenue contraction to (1) lower power generation revenue, which slightly outweighed the YoY doubling real estate sales (from the Charm Villa project) and higher revenue from the office leasing & hotel segment. However, the YoY lower financial expenses offset the 8% YoY lower gross profit, resulting in a YoY flat NPAT-MI. 

  • We see downside risk to our 2024F NPAT-MI projection as the delay in Charm Villa Phase 3’s sales launch (previously scheduled for Q3 2024) potentially outweighs slightly better-than-expected hydropower earnings (which we expect to be stronger QoQ in Q4), pending a fuller review.  

  • We currently have a MARKET PERFORM rating for HDG with a target price of VND29,300/share. 

HDG’s 9M 2024 results 

VND bn 

Q3 2023 

Q3 2024 

 YoY 

9M 2023 

9M 2024 

 YoY 

% of Vietcap’s 2024F 

Revenue 

500 

567 

13% 

2,020 

1,965 

-3% 

71% 

  Real estate  

-209 

N.M. 

183 

399 

118% 

76% 

  Energy  

377 

445 

18% 

1,295 

1,206 

-7% 

67% 

  Office leasing & hotel 

106 

123 

15% 

304 

351 

16% 

76% 

  Construction & others 

226 

-100% 

237 

-97% 

N.M. 

Gross profit 

274 

336 

23% 

1,130 

1,037 

-8% 

65% 

  Real estate  

-16 

-17 

N.M. 

121 

132 

8% 

39% 

  Energy  

228 

309 

36% 

850 

755 

-11% 

72% 

  Office leasing & hotel 

46 

44 

-3% 

134 

150 

12% 

74% 

  Construction & others 

17 

-100% 

25 

N.M. 

N.M. 

Selling exp 

-2 

-2 

-3% 

-6 

-4 

-40% 

17% 

G&A 

-19 

-42 

118% 

-122 

-127 

4% 

69% 

Operating profit 

254 

293 

16% 

1,002 

906 

-10% 

65% 

Financial income 

11 

17 

59% 

27 

38 

40% 

119% 

Financial expenses 

-127 

-102 

-20% 

-417 

-303 

-27% 

64% 

   In which, interest expense 

-120 

-93 

-22% 

-378 

-269 

-29% 

64% 

Other non-operating income 

-27 

-5 

-82% 

-8 

N.M. 

N.M. 

PBT 

110 

203 

86% 

604 

647 

7% 

69% 

  - Income tax exp 

-10 

-21 

114% 

-70 

-102 

45% 

82% 

NPAT before MI 

100 

182 

83% 

533 

545 

2% 

67% 

  - Minority interest 

-15 

-44 

193% 

-111 

-122 

10% 

75% 

Reported NPAT-MI 

84 

138 

63% 

423 

423 

0% 

65% 

      Source: HDG, Vietcap  

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