Investment Recommendation

FPT_POSITIVE_TP 46,50_Continue to benefit from Digital Transformation_BSC Company Update

Date

12/04/2022
Security code

FPT
Company

FPT Corp
Language

Tiếng Anh
Number of Downloads

654

Detailed report

Valuation

We raise our recommendation to BUY from OPERATE for FPT stock with a 2022 target price of VND116,300 with upside potential of 22% from the price on March 21, 2022 after adjustment (i) increase forecast for 2022 (ii) increase target PE from 18 to 19.

Forecast business results in 2022

BSC forecasts that FPT's revenue and profit in 2022 are estimated at VND 43,462 billion (+22% YoY) and an after-tax profit of VND 6,614 billion (+24% YoY). EPS FW 2022 = 5,630 VND. PE FW 2022 = 16.8 times.

Business Outlook 2022

Technology (domestic and international) continues to benefit from demand for Digital Transformation and new technology trends
Telecommunications sector is challenged with a high base level in 2021
The Education sector keeps its growth momentum when the enrollment demand is high and continuously expands the number of schools in the provinces and cities.

Risks

The complicated evolution of the epidemic affects the speed of recovery
Risks of competition to attract human resources Technology

Business Updates

In 2021, FPT recorded business results with a growth rate in line with BSC's forecast. Revenue and profit after tax reached 35,657 billion (+19.5% YoY) and 5,349 billion (+20.9% YoY), equivalent to 98% and 100% of BSC's forecast.
Updated business results for the first two months of 2022: Revenue and profit after tax reached VND 6,102 billion (+27% YoY) and VND 756 billion (+36% YoY). The main growth contribution continued to come from Technology segment with revenue and pre-tax profit of 3,364 billion (+30.5% YoY) and 490 billion (+56% yoY). Digital transformation service revenue continued to increase (+81% YoY).