VNM [OUTPERFORM +11.7%] - Earnings growth to be driven by lower input costs

- We cut our target price (TP) for VNM by 9% but maintain our OUTPERFORM rating.

- Our lower TP is mainly due to reducing our aggregate 2023-2027F EBIT by 8% as VNM had weaker-than-expected domestic sales and gross profit margin improvement in H2 2022.

- We forecast a domestic revenue CAGR of 5% in 2022-2025F vs a 2% YoY decline in 2022. Additionally, our expected improvement in gross margin by 200/90/100 bps in 2023/24/25F drives our EPS CAGR forecast of 13% in 2022-2025F.