BCM Update – BUY

1Q2026 business results were unfavorable due to lower handovers of industrial park (IP) and residential land compared to the same period last year. However, we maintain our full-year 2026 forecast, expecting IP handovers and profits from JVs and associates to improve in the upcoming quarters. We revised our year-end 2026 target price down by 5% to VND 73,100/share due to an increase in net debt, and we are upgraded our recommendation from Outperform to Buy as the stock price has adjusted 17% since our report on February 9, 2026.

BCM recorded underperforming 1Q2026 business results with revenue reaching VND1,106 bn and NPAT reaching VND288 bn, down 40% and 21% YoY, respectively, fulfilling only 14% and 7% of the full-year targets. This decline was mainly driven by:
(1) Real estate segment’s revenue dropped 47% YoY to VND754 bn due to lower handovers of IP and residential areas compared to the same period last year.
(2) Financial income decreased by 38% YoY to VND63 bn due to the absence of profits from business cooperation contracts (BCC) that were present in the same period last year; and
(3) Profits from JVs and associates declined by 19% YoY to VND220 bn.

The leverage ratio continued to rise and remains significantly higher than the industry median. In 1Q2026, total debt increased by nearly VND1,600 bn to VND25,523 bn, with bonds accounting for 54% and bank loans making up 45%. Net debt rose by nearly VND2,200 bn to VND23,454 bn. Consequently, the Net debt/Equity ratio climbed from 91% to 104.3%, and the Net debt/EBITDA ratio increased from 8.0x to 8.7x—both substantially higher than the industry medians of -31.3% and -2.1x, respectively.

During the first 5 months of 2026, VSIP—a JV that contributes over 50% of BCM’s NPAT—secured approvals in principle for 3 new projects: VSIP Hue IP (467 ha, total investment of VND3,075 bn), Tho Loc IP – Phase 2 (80 ha, VND688 bn) and Ha Nam High-Tech Park (628 ha, VND5,990 bn). This brings the total number of projects invested by VSIP to 24. VSIP expects to further expand its portfolio, aiming for a total of 30 IPs by the end of 2026. We forecast VSIP’s 2026 NPAT to reach VND4,451 bn (+19% YoY), driven primarily by VSIP Binh Duong 3, VSIP Nghe An – Phase 2, VSIP Ha Tinh, etc., alongside residential projects such as Sun Casa Square, Casa Flora, and The Greenery.

Overall, the outlook for the IP segment is improving as the Government finalizes the Resolution on foreign-invested economic development and intensifies efforts to attract high-tech FDI projects, such as semiconductors and artificial intelligence (AI). We expect BCM, as well as VSIP and BWID, to benefit from this policy support. Conversely, high interest rates and tightening credit for the real estate sector continue to pressure the residential property outlook in 2026. Therefore, we maintain our 2026 NPAT forecast for BCM to grow slightly by 3% YoY, reaching VND3,636 bn, equivalent to 94% of the company’s full-year target.