IMP Initial Coverage-BUY October 23, 2020

IMP INITIATE - BUY Recommendation With TP: 54,849 VND/Share: 9M2020 EBT and EAT jumped by 21.8% and 26.4% YoY, respectively, on the back of widened gross margin, lower selling expenses to net revenue ratio, no allocation for science & technology fund and tax incentives for expansion of a factory in Binh Duong. However, 2021 EBT growth is forecast at 9.2% YoY with assumptions of additional depreciation expense from the new factory and the uptrend in global raw material prices. Nonetheless, capex pressure for construction of factories has been loosened and no additional big investment planned in near future.

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