Individual Clients
Corporate Clients
IDC Update – OUTPERFORM
27/11/2023 - 1:48:05 CHIDICO CORPORATION – JSC (IDC VN)
IDC posted unpleasant 9M2023 result with revenue of nearly VND5trn (-29% YoY) and PAT of over VND1trn (-56.4% YoY) which were lower than our expectation. We revise our 2023 PAT forecast by 25% and give an OUTPERFORM rating with 2024 target price of VND54,159/share.
Total revenue in 9M2023 declined by 29% YoY, to VND5trn mainly due to a 45.4% drop in industrial park (IP) revenue, to over VND2.2trn. Gross margin also decreased to 32% (-11.8 pp YoY) mainly due to a lower gross margin of the IP segment (50.6%, -13.8 pp YoY). This result was primarily driven by lower unearned revenue recorded when changing booking method from annually to one-off (i.e. ~VND400bn from Que Vo 2 IP in 9M2023 compared with ~VND2,400bn from Nhon Trach 5, Phu My 2, Phu My 2 extension and My Xuan B1 IPs in 9M2022).
Regarding the Power segment, revenue in 9M2023 was recorded at VND2.1trn (-3% YoY) mainly due to lower electricity volume distributed in IPs when tenants cut their production capacities given lower orders. Gross margin, however, improved to 10.7% (+3.1 pp YoY) mainly thanks to the reoperation of Dak Mi 3 hydropower plant from Oct, 2022 after a long period of maintenance after floods.
The BOT segment was in line with our forecast with 9M2023 revenue increasing by 4.9% YoY, to VND327bn thanks to growth of PCUs given unchanged toll fees. Segmented gross margin was stable at 44.5% (-1.3 pp YoY).
In 9M2023, financial income went sideways and was recorded at VND132bn while financial expenses rose by 42.2% YoY, to VND148bn due to higher interest rates.
IDC was in a good financial position with net debt declining by over VND100bn in 9M2023, to VND1.2 trn and Net debt/Equity staying at 21.9% (-0.4 pp YoY).
Given deliveries of IP area and electricity volume distributed in IPs were lower than our expectation as well as the transfer of 2.2ha to Aeon with revenue of VND437bn was expected to be booked in early 2024 instead of 4Q2023, we revise estimated 2023 revenue down by 14%, to over VND7trn and PAT by 25%, to nearly VND1.6trn. For 2024, we forecast revenue at nearly VND8.7 trn (+23.6% YoY) and PAT at nearly VND2.4trn (+52.7% YoY). We roll forward the valuation to 2024 with a target price of VND54,159/share and give an OUTPERFORM rating for IDC.
