Title PNJ_BUY_TP 127,400_Like a day without storms_BSC Company Update
Report Type Phân tích công ty
Source BSC
Bussiness PNJ
Detail Date : 12/04/2022
Total pages : 10
Language : English
File Type : .PDF
FileSize : 1393 Kb
Download: 115
Download
Vote (You must be logged in to vote)
Short Content

Valuation

BSC maintains its recommendation to BUY PNJ with a 2022 target price of VND 127,400/share upside 20% compared to March 4, 2022. Valuation based on DCF method with WACC=10%
 
Forecasting business results
BSC expects revenue and PAT in 2022 to reach VND 23,847 billion (+22% YoY) and VND 1,383 billion (+34% YoY), EPS fw is VND 5,637/share. PE fw = 19x – Higher than 5-year average P/E of 17x; thanks to offsetting consumer trends and improved profit margins.
 
Investment Thesis
  • The low base level of 2021 with the expectation of expanding market share and scale in the period 2022-2023 thanks to (1) The jewelry retail industry is expected to recover in the shape of a "K" (2) The trend of revenge shopping In the short term, and people's incomes recover, the middle class structure increases in the long term.
  • Growth potential comes from within the business, including (1) Strategy to expand market share by increasing the number of stores in tier 2 and 3 city areas; (2) Product restructuring and cost optimization (3) Exploiting potential young customer segments through modern and strategic sales channels marketing. 
 
Catalyst:
PNJ is expected to issue 15 million shares individually, at the price of 95,000 VND/share.
 
Risks
  • The epidemic continues to affect jewelry purchasing power.
  • Disposable income recovered lower than expected.

Updated business results for 2021
  • Revenue and PAT in 2021 will reach VND 19,613 billion (+12%YoY) and VND 1,034 billion (-3.3% YoY), respectively. PAT declined due to the impact of the pandemic and gross profit margin decreased by 1.4ppt as the contribution of gold bars increased from 22% (2020) to 26% (2021).
  • Net revenue and PAT in January 2022 reached VND 3,476 billion (+60.2%YoY) and VND 270 billion (+60.7%YoY) respectively thanks to pent-up demand from 2021, shopping during Tet and the effectiveness of campaigns marketing and promotions from the end of 2021.