Morning Café
Morning Café Issue: 1,238 May 05th, 2015 VN-Index Volume: 112.5m Value: VND1,774bn -17.32 (-3.08%) VN30-Index 576.52 HNX-Index 79.95 Volume: 44.7m Value: VND867bn - -16.63 (-2.80%) Volume: 59.2m Value: VND646bn 700 Summary 545.08 May 05, 2015Morning Strategy -2.8 (-3.38%) VN-Index VN30-Index 700 650 650 600 600 550 550 500 500 450 M-14 J-14 S-14 N-14 J-15 M-15 450 95 HNX-Index 90 85 80 75 70 65 M-14 J-14 S-14 N-14 J-15 M-15 May 05, 2015 Morning Strategy VNM: AGM note Technical View Fixed income The VN-Index dropped suddenly by 3.08% (17.32 points), breaking through the nearest technical support at 560, and closing at a daily low of 545.08, on increased market liquidity. 29 out of 30 of the VN30 stocks fell yesterday, including IJC and OGC, which dropped to their floor prices. Among the most heavily traded tickers, FLC and BID also fell to their floor prices. GAS, PVD, CTG, VCB etc. all fell by 4-6%. In other words, market sentiment was bearish, and was then further scared by the sudden market movement. Foreign investors continued accumulating stock, with a net buying value of approximately US$ 11 million. However, at the end of trading, when domestic investors increased supply and pushed down prices, these investors did not support the market, though stocks became more attractive. The sudden market drop might be because local investors overreacted on China’s Hung Vuong Oil Rig which moved to the East Sea. Even though the oil rig is still far away from Vietnam’s sea area, this news remind local investors on the market extreme condition exactly 1 year ago and created the market panic. Local investors have to get used with these news as tensions with China will continue in future and we still have to build our economy. Besides, there are more fundamental issues that should be noted. Firstly, there is rising concern about NPLs in the banking sector, as the Government Inspector asked the SBV to monitor Bitexco’s VND 1.7 trillion loan, and an SBV report showed that NPLs rose to 3.5% in Jan 2015. Secondly, banks adjusted the USD/VND exchange rate up by 20-30 points after the long holiday, though the official and free market exchange rates were still within the legal limits. However, the government’s request that the SBV look into a mechanism allowing the Treasury to ‘borrow’ from the national foreign currency reserve might be the most concerned issue. In any case, these issues are not new and cannot entirely explain the sudden market drop. From a technical perspective, with this sudden drop, the VN-Index has reversed its uptrend and is heading to the next technical support at 540 – 536, which is not very strong. If the VN-Index continues down past this support, the next target will be close to 500, a 12M low. With the sudden drop, margin call activities might return in upcoming trading sessions. Even though the current retail margin outstanding might be relatively low, margin calls might have a serious effect on some stocks. With the high risk and great uncertainty, short- ACBS Research Center Tel: (+84)(8) 3823 4159 (ext: 325) Website: http://www.acbs.com.vn Bloomberg : ACBS <GO> Page1 Morning Café term investors might want to stay out or get out of the market. For long-term investors, we do not see any reason to sell at this time. Ms. Anh Le CFA, FRM [email protected] Company/Sector News and Comments VNM: AGM note We attended Vinamilk JSC’s (HSX: VNM) AGM in late April. Here are some key points: In 2014, VNM delivered VND34,977bn in net revenue (c.$1.64bn; +13% YoY), VND7,613bn in EBT ($357m; -5% YoY) and VND6,068bn in EAT (c.$285m; -7% YoY), meeting 98% and 101% of its full-year targets respectively. 2014 EPS was VND6,068. Although generally outperforming its 5-year targets, these growth rates are down from previous years, due to a combination of intense competition, rising selling expenses, turbulent raw material prices, the government’s price cap for infant milk and the company’s swelling size. However, the good news is that the company’s effort to secure its position in Vietnam’s dairy market seems to have worked, as it has expanded its market share to 51% of the liquid milk segment and 24% for powdered milk. In 2014, VNM put two more farms in Ha Tinh and Thanh Hoa into operation, raising the number of farms it owns to 7, with approximately 11,000 cows. In addition, VNM continued to expand cooperation with farmers, who own another 77,000 head. 2015 business plan: Although the tougher business environment may endure, in our opinion, 2015 will likely be a better year as global raw material prices will calm down. VNM targets net revenue of VND38,424bn (+10% YoY), EBT of VND8,229bn (+8% YoY) and EAT of VND6,830bn (+12.6% YoY (this is higher than EBT growth because of some tax incentives from new factories, according to the company)). $3bn in revenue in 2017 is still the company’s goal. Regarding the 2015 dividend plan, the company has scheduled a first interim dividend payment of VND2,000 cash per share in Sep 2015. A subsequent payment will take place in May 2016. Also, a bonus share issuance at a 5:1 ratio is planned for 3Q2015. Ms. Chi Luong [email protected] ACBS Research Center Tel: (+84)(8) 3823 4159 (ext: 325) Website: http://www.acbs.com.vn Bloomberg : ACBS <GO> Page2 Morning Café Technical View The VN30 index dropped dramatically yesterday, after bad news came out of the East Sea, even while trading volume increased significantly, which suggests that the buying pressure is still strong. The short-term market trend is now rather unclear, however, the index may have a minor rebounding to the weak resistance at 585 points before settling on a trend. Mr. Quyen Luong [email protected] ACBS Research Center Tel: (+84)(8) 3823 4159 (ext: 325) Website: http://www.acbs.com.vn Bloomberg : ACBS <GO> Page3 Morning Café Fixed Income Interbank market Tenor O/N 1W 2W 1M 2M 3M 6M 9M 1 Yr Bid (%) 3.700 4.200 4.340 4.520 4.600 4.620 4.720 4.820 4.920 Ask (%) 4.160 4.480 4.820 5.120 5.040 5.060 5.160 5.360 5.460 Average (%) 3.930 4.340 4.580 4.820 4.820 4.840 4.940 5.090 5.190 DoD Change (%) 0.674 0.569 0.512 0.352 0.150 0.090 0.140 -0.135 -0.052 WoW Change (%) -0.920 -0.410 -0.110 0.170 0.155 0.170 0.270 0.105 0.195 SBV open market operation Tenor 7D 28D 56D 91D Transaction Type Reverse Repos Sell Outrights Sell Outrights Sell Outrights Value (VND bn) 1,000 1,000 990 Yield (%) 5.000 3.500 3.900 DoD Change (%) 0.000 0.000 0.000 WoW Change (%) 0.000 - (Last updated on May 04th, 2015) VBMA government bond yield fixing Tenor 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 7 Yr 10 Yr Yield to Maturity (%) 5.045 5.267 5.408 5.604 5.800 6.330 6.695 DoD Change (%) 0.015 0.052 0.022 0.038 0.054 0.140 0.190 WoW Change (%) -0.155 -0.148 -0.102 -0.172 -0.241 0.026 0.095 MoM Change (%) 0.327 0.342 0.342 0.334 0.326 0.245 0.260 Secondary government bond market Tenor 1 Yr 2 Yr 3 Yr 3-5 Yr 5 Yr 10 Yr Value (VND bn) 486 1,286 116 275 401 201 Yield to Maturity (%) 5.008 5.221 5.850 5.873 5.762 6.630 DoD Change (%) 0.023 0.550 0.253 -0.152 - WoW Change (%) -0.062 -0.061 0.450 -0.208 - Comment On the Secondary market, total outright transaction volume reached VND 2,766 billion, while repo transactions achieved VND 3,117 billion at a rate range of 3.8%-4.7% for a 14-93-day tenor. Ms. Ngoc Ngo [email protected] ACBS Research Center Tel: (+84)(8) 3823 4159 (ext: 325) Website: http://www.acbs.com.vn Bloomberg : ACBS <GO> Page4 Morning Café Event Calendar Today’s events Ticker SHN Execution Date - Event 2015 Annual Shareholder Meeting Up-coming events Ticker PCG Ex-rights Date 05/06/2015 Execution Date 05/20/2015 Event Dividend payment of VND 400/share for 2014 DHT 05/06/2015 05/22/2015 Dividend payment of VND 1,000/share for 2014 HCM 05/06/2015 05/27/2015 2nd dividend payment of VND 1,600/share for 2014 CAN 05/06/2015 05/29/2015 Dividend payment of VND 1,500/share for 2014 TCT 05/06/2015 05/29/2015 2015 Annual Shareholder Meeting CLL 05/06/2015 06/01/2015 Dividend payment of VND 1,200/share for 2014 BBC 05/06/2015 06/06/2015 2015 Annual Shareholder Meeting TJC 05/06/2015 06/25/2015 Dividend payment of VND 500/share for 2014 TCT 05/06/2015 06/29/2015 Dividend payment of VND 2,500/share for 2014 CLL 05/06/2015 - 1 for 10 bonus issue CTI 05/06/2015 - 2015 Annual Shareholder Meeting SJD 05/06/2015 - 2015 Annual Shareholder Meeting SRA 05/06/2015 - 2015 Annual Shareholder Meeting TJC 05/06/2015 - 2015 Annual Shareholder Meeting VFG 05/07/2015 05/22/2015 3rd dividend payment of VND 1,500/share for 2014 DHA 05/07/2015 05/28/2015 Dividend payment of VND 800/share for 2014 TVD 07/05/2015 01/06/2015 Dividend payment of VND 1,000/share for 2014 BID 05/08/2015 05/22/2015 Dividend payment of VND 1,020/share for 2014 DHG 05/08/2015 05/26/2015 Dividend payment of VND 3,000/share for 2014 CT6 05/08/2015 05/28/2015 Dividend payment of VND 1,000/share for 2014 DRL 05/08/2015 05/28/2015 Additional dividend payment of VND 1,500/share for 2014 and 2015 HPG 05/08/2015 05/28/2015 Dividend payment of VND 1,000/share for 2014 TVS 05/08/2015 06/05/2015 Dividend payment of VND 600/share for 2014 HPG 05/08/2015 - 2 for 10 stock dividend payment for 2014 HPG 05/08/2015 - 3 for 10 bonus issue SLS 05/08/2015 - TMC 05/12/2015 05/26/2015 VPK 05/12/2015 05/26/2015 2015 Annual Shareholder Meeting 3rd dividend payment of VND 400/share for 2014 and 1st dividend payment of VND 200/share for 2015 Dividend payment of VND 2,000/share for 2014 KAC 05/12/2015 05/29/2015 2015 Annual Shareholder Meeting VHL 05/12/2015 05/29/2015 Dividend payment of VND 2,000/share for 2014 CDC 05/12/2015 06/16/2015 Dividend payment of VND 500/share for 2014 HDA 05/12/2015 07/31/2015 Dividend payment of VND 1,000/share for 2014 HDA 05/12/2015 - 2015 Annual Shareholder Meeting TDW 05/13/2015 05/29/2015 1st dividend payment of VND 1,200/share for 2014 GTA 05/13/2015 06/08/2015 Dividend payment of VND 900/share for 2014 ACBS Research Center Tel: (+84)(8)3823 4159 (ext: 325) Website: http://www.acbs.com.vn Bloomberg : ACBS <GO> Page5 Morning Café Contacts: Ho Chi Minh City Head Office 41, Mac Dinh Chi Dist 1, Ho Chi Minh City Tel: (+84 8) 3823 4159 Fax: (+84 8) 3823 5060 Hanoi Office 10, Phan Chu Trinh HoanKiemDist, Ha Noi Tel: (+84 4) 3942 9395 Fax: (+84 4)3942 9407 Research Deputy Head of Research Anh Le (+84 8) 3823 4159 (x354) [email protected] Associate Director Head of Industry Coverage Uyen Nguyen (+84 8) 3823 4159 (x323) [email protected] Associate Director Head of Industry Coverage Huy Hoang (+84 8)3823 4159 (x360) [email protected] Associate – Steel, Logistics, Agri, Power, Seafood Yen Tran (+84 8) 3823 4159 (x326) [email protected] Associate – Consumerrelated, Technology Chi Luong (+84 8) 3823 4159 (x327) [email protected] Associate– Property Truc Pham (+84 8) 3823 4159 (x351) [email protected] Associate Director Head of Market Research Quyen Luong (+84 8) 3823 4159 (x358) [email protected] Analyst Ngoc Ngo (+84 8) 3823 4159 (x352) [email protected] Sales & Trading Director, Sales Trang Nguyen (+84 8) 5404 3070 [email protected] Associate, Sales Tuan Hoang (+84 8) 3823 4798 [email protected] Associate, Sales Chi Huynh (+84 8) 3823 4159 [email protected] Director, Trading Hanh Huynh (+84 8) 5404 6632 [email protected] Senior Trader Thao Nguyen (+84 8) 5404 6627 [email protected] Senior Trader Ngoc Dinh (+84 8) 5404 6626 [email protected] ACBS Research Center Tel: (+84)(8)3823 4159 (ext: 325) Senior Trader Nhu Thai (+84 8) 38234159 (x311) [email protected] Website: http://www.acbs.com.vn Bloomberg : ACBS <GO> Page6 Morning Café Disclaimer Analyst Certification(s) We, the author(s) of this report, hereby certify (1) that the views expressed in this research report accurately reflect our personal views about any or all of the subject securities or issuers referred to in this research report and (2) no part of our compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed in this research report. 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