- 2025-01-25T00:00:00
- Company Research
- VHM recorded strong growth in Q4 2024, with underlying property revenue (including business cooperation contracts (BCC) and bulk sales transactions recognized as financial income) of VND44.5tn (USD1.7bn; +5.7x YoY) and NPAT-MI of VND11.5tn (USD452mn; +47% QoQ and +6.2x YoY), mainly driven by the recognition of retail and bulk sales at Royal Island and Ocean Park 3.
- For full-year 2024, VHM’s underlying property revenue was VND113tn (USD4.4bn; +1% YoY) and NPAT-MI was VND31.5tn (USD1.2bn; -6% YoY), both exceeding our forecasts by 15%, which we mainly attribute to Q4 2024 better-than-expected bulk sales recognition. Nevertheless, we foresee insignificant changes to our current 2025F NPAT-MI forecast (VND31.3tn/USD1.2bn), pending a fuller review.
- Bulk sales at Ocean Park 3 contributed significantly to VHM’s Q4 2024 contracted sales value of VND14.3tn (USD562mn; -62% QoQ and -53% YoY). In 2024, VHM’s contracted sales value was VND103.9tn (USD4.1bn; +19% YoY), with the Royal Island contributing 55% and Ocean Park 3 contributing 19%. The YoY growth in 2024 was driven by higher retail presales largely attributed to the launch of the Royal Island project in March. As the 2024 result beat our forecast by 9%, we foresee upside potential to our current 2025F contracted sales forecast, pending a fuller review.
- 2025G contracted sales guidance: Per management, presales will be driven by expected new project launches, including Wonder Park (Hanoi), a project in Long An, and Duong Kinh (Hai Phong), along with continued presales at existing projects.
- As of end-2024, VHM’s unbilled bookings amounted to VND94.2tn (USD3.7bn; -5.5% YoY) with bulk sales accounting for 54%.
- Progress of international bond issue plan (up to USD500mn; maximum 5 years; non-convertible and unsecured bonds): VHM has completed the necessary regulatory procedures and is currently in discussions with potential investors.
Figure 1: VHM’s 2024 results
VND bn | 2023 | 2024 | YoY | 2024F | 2024 as | Vietcap’s comments on 2024 results |
Net revenue | 103,557 | 102,045 | -1% | 95,640 | 107% |
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| 89,669 | 73,203 | -18% | 68,614 | 107% | * VHM’s 2024 underlying property revenue (including BCC and bulk sales transactions recognized as financial income) amounted to VND113tn (USD4.4bn; +1% YoY), mainly from the Royal Island, Ocean Park 2 & 3 projects. |
| 13,888 | 28,842 | 108% | 27,027 | 107% | * Mainly construction and leasing services. |
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Gross profit | 35,707 | 32,425 | -9% | 32,597 | 99% |
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| 33,793 | 28,838 | -15% | 29,551 | 98% |
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| 1,914 | 3,587 | 87% | 3,046 | 118% |
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SG&A expenses | -7,756 | -8,784 | 13% | -7,567 | 116% |
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EBIT | 27,951 | 23,641 | -15% | 25,030 | 94% |
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Financial income | 19,954 | 26,343 | 32% | 17,903 | 147% |
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| 1,226 | 19,209 | 1467% | 11,811 | 163% | * Includes Royal Island’s 1) bulk sales recognitions in Q2 2024 and Q4 2024, and 2) retail handovers starting from Q3 2024. |
| 18,729 | 7,134 | -62% | 6,092 | 117% | * Recorded one bulk sales transaction at Ocean Park 3 in Q4 2024. |
Financial expense | -3,870 | -8,629 | 123% | -7,688 | 112% |
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Other gain/loss | -735 | -497 | N.M. | -200 | N.M. |
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PBT | 43,310 | 40,860 | -6% | 35,045 | 117% |
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PAT | 33,533 | 35,052 | 5% | 28,036 | 125% |
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NPAT-MI | 33,371 | 31,527 | -6% | 27,504 | 115% | * The 2024 earnings exceeded our forecast, mainly due to higher-than-expected Q4 2024 recognition of bulk sales. |
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Gross margin % | 34.5% | 31.8% |
| 34.1% |
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| 37.7% | 39.4% |
| 43.1% |
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| 13.8% | 12.4% |
| 11.3% |
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SG&A as % sales | 7.5% | 8.6% |
| 7.9% |
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EBIT margin % | 27.0% | 23.2% |
| 26.2% |
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Effective tax rate % | 22.6% | 14.2% |
| 20.0% |
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NPAT-MI margin % | 32.2% | 30.9% |
| 28.8% |
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Source: VHM, Vietcap forecasts (last updated on November 26, 2024). Note: (*) Vingroup signed a business cooperation contract (BCC) with VHM to fully transfer the economic interest of real estate developments that are not injected into VHM due to the complexity of paperwork. Thus, VHM records all gains via financial income.
Figure 2: VHM’s quarterly contracted sales results (VND tn)
Source: VHM, Vietcap compilation
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