KBC Update – OUTPERFORM

2Q2026 and 1H2026 business results were unfavorable, primarily due to lower delivered industrial park (IP) land area compared to the same period last year. We revised down 2026 revenue and NPAT forecasts by 23% and 17% respectively due to the postponement of the bulk sale recognition for 15 ha at the Trang Cat urban area from 2026 to 2027. Target price by end-2026 was also adjusted down 12% to VND 32,300/share due to the delayed launch and handover timeline of the Trang Cat urban area project. Reiterate Outperform rating.

KBC reported weak 2Q2026 business results with flat revenue at VND589 bn (+2% YoY) and a sharp 91% YoY decline in NPAT to VND34 bn. The 1H2026 results also dropped, with revenue of VND1,925 bn (-48% YoY) and NPAT of VND269 bn (-78% YoY), completing only 9% of the full-year profit plan, mainly due to:
1) IP revenue decreased by 71% YoY, to VND828 bn due to lower handed-over land area (20.9 ha delivered in 1H2026—mainly at Nam Son Hap Linh IP with 9.8 ha, Que Vo expandsion IP 2 with 5 ha, and 3 industrial clusters in Hung Yen with 5.3 ha—compared to 85.8 ha in 1H2025).
2) Financial expenses rose 152% YoY, to VND567 bn due to higher outstanding debts and elevated interest rates.
3) Effective tax rate reached 52% in 1H2026 (vs. 25% in 1H2025), primarily because non-deductible interest expenses exceeding the 30% EBITDA cap under Decree 132/2020/ND-CP.

Accumulated to June 2026, KBC signed MOUs for 170 ha of IP land, of which over 20 ha were delivered in 1H2026. In 2H2026, KBC plans to sign new contracts for ~100 ha and deliver ~150 ha, targeting revenue of around VND 6,000 bn.

Benefiting from active government policy support and favorable interest rates, ongoing social housing projects at Nenh town and Trang Due urban area achieved strong absorption and delivery rates. In 1H2026, the company sold 856 social housing units at Trang Due and delivered 899 units across Nenh town (461 units) and Trang Due Urban Area (438 units), recording real estate transfer revenue of VND717 bn (+74% YoY).

Amid market headwinds such as high interest rates and tighter credit controls, we expect the bulk sale of 15 ha at Trang Cat urban area (estimated revenue over VND1,400 bn) to shift from 2026 to 2027. Consequently, 2026 revenue and NPAT forecasts were revised down by 23% and 17% to VND8,149 bn (+22% YoY) and VND2,206 bn (flat YoY), respectively. The target price for end-2026 was reduced by 12% to VND 32,300/share.