NVL update – HOLD

NO VA LAND INVESTMENT JSC (NVL VN)

We adjust our whole year 2022 forecast to reflect subdued 1Q2022 results amid market challenges and COVID-19 related delays. Reiterate our Hold rating with target price of 83,058 

NVL is the second-biggest listed property developer with an expected land bank of 10,600ha, a professional sales force, and proven fundraising capability. It is expected to benefit from the high demand of second/leisure homes from the rising middle class in Vietnam and more government spending on infrastructure projects. Using the NAV method, we reiterate our Hold rating for Novaland with a target price of VND83,058/share, 13% lower than the previous target price in 12/2021 given challenges in the real estate sector in the short-term which affect sales performance and delay projects launches and deliveries. We also note high leverage ratios and dilution risk from USD300mn of convertible bonds issued last year and USD250mn of convertible bonds to be issued later this year.

View details in full report below.