X-Alpha | VVS KKN: Three Growth Catalysts — Public Investment, Emission Standards, and Value Chain Expansion

2026–2027 BUSINESS OUTLOOK

1.Accelerating public investment is expected to be the key driver of demand for specialized vehicles, heavy-duty trucks, and tractors, with volume growth projected at 40%–50% YoY. However, after peaking in 2027, demand growth may slow to around 13% per year.

2.The implementation of new emission standards is expected to trigger a replacement cycle for aging vehicle fleets.

3.Longer term, the 2028–2030 growth story is supported by investment in a domestic automobile assembly plant, which could help reduce truck selling prices by around 10%.

 

2026–2027 EARNINGS FORECAST

For 2026, revenue is forecast at VND9,695bn, up 20% YoY, driven by construction contractors expanding their vehicle fleets to serve public investment projects, while transportation companies gradually replace aging fleets to comply with new emission standards.

Net financial income is forecast at VND119bn, up 89% YoY, mainly supported by deposit interest income.

NPAT-MI is forecast at VND396bn, up 23% YoY. We note that 4Q profit is expected to account for a large proportion of full-year earnings, as the company’s full-year sales bonuses are typically recognized during this period.

For 2027, revenue and NPAT-MI are forecast at VND10,545bn, up 9% YoY, and VND425bn, up 8% YoY, respectively, supported by similar growth drivers as in 2026.

 

4Q2025 EARNINGS UPDATE

Revenue reached VND2,606bn, up 115% YoY and 17% QoQ, while net profit reached VND156bn, 22x higher YoY and up 75% QoQ.

For full-year 2025, revenue reached VND8,050bn, up 107% YoY, while net profit reached VND321bn, up 372% YoY. The Government’s commencement of multiple key infrastructure projects provided a significant boost to transportation companies and construction contractors, directly increasing truck demand.

RISKS

Key risks include: (1) a sharp increase in the USD/VND exchange rate; (2) policy impact if the Government abruptly shifts toward encouraging electric trucks; and (3) higher interest rates delaying vehicle purchase demand.

Year to date, VVS’s share price has increased by 81.6%, outperforming the VN-Index’s -4.1% return. BSC provides this update for informational purposes and does not issue a BUY/SELL recommendation.