VALUATION
§ We maintain our BUY recommendation for GAS, with the target price in 2022 being 151,400 VND/share (+17% compared to the closing price on June 7, 2022), equivalent to a target P/E of 22x.
FORECASTING BUSINESS PERFORMANCE
§ BSC forecasts that the net revenue and profit after tax of GAS in 2022 will reach 105,313 billion VND (+33% YoY) and 13,438 billion VND (+52% YoY), EPS FW = 6,881 VND/share with the assumptions (1) Average oil price in 2022 will reach 100 USD/barrel (+37% YoY); (2) Dry gas consumption reach 8.7 billion m2 (+24% YoY), LPG reach 2.1 million tons (+5% YoY).; and (3) The Thi Vai NLG port warehouse has not been put into the forecast in 2022.
INVESTMENT THESIS
§ High oil prices in 2022 will help improve the profit of GAS.
§ Gas output improves due to the demand for gas mobilization from power plants.
§ The LNG segment is a long-term growth driver, helping GAS to be re-evaluated.
RISKS
§ Dry gas and fuel prices are lower than estimated.
§ Key gas field projects are behind schedule.
BUSINESS PERFORMANCE UPDATE
§ The revenue of GAS in Q4/2021 is nearly 21,185 billion VND (+36% YoY) and Profit Before Tax is 1,846 billion VND (-12% YoY). In 2021, GAS's revenue reached 80,000 billion VND (+25% YoY), and NPAT reached 8,380 billion VND (+5% YoY), completing 119% of the plan.
§ LNG Thi Vai project was built on schedule, expected to be completed in Q4/2022.
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