MWG [OUTPERFORM +11.1%] - ICT margins rebound; BHX’s upbeat NPAT outlook

- We raise our target price (TP) by 20% to VND65,700/share, but downgrade our rating to OUTPERFORM from BUY as the stock has rallied ~35% in the past three months.

- Our higher TP primarily stems from a 25% uplift in our valuation for TGDD & DMX, mainly driven by a 24%-rise in the chain's aggregate 2024F-25F NPAT-MI. Additionally, we raise BHX’s valuation by 22%, mainly driven by our higher operational efficiency forecast to reflect better-than-expected Q1 2024 results. We also roll our TP horizon forward to mid-2025.

- We are more positive in our projections for TGDD & DMX’s margins in 2024F-28F and expect the chain to improve its OPM to 6.5% in 2028F (up from 5.9% previously). We are more bullish on BHX’s net profit stream and expect the chain to generate NPAT of USD22mn in 2025 (up from our previous forecast of USD10mn), contributing 10% to our MWG’s 2025F NPAT-MI.