CTD Update – BUY | December 10, 2021

COTECCONS CONSTRUCTION JSC (CTD VN) 

Raised to Buy with target price of VND100,801/share thanks to expansion into infrastructure segments, improved financial transparency and strong increase in winning value.

Business results in Q3/2021 fell sharply compared to the same period last year and were lower than our expectations. Revenue reached more than 1,000 billion dong (-61% n/n) and suffered a loss of 12 billion dong compared to after-tax profit of 89 billion dong in Q3/2020 due to the social distancing period in the South during the second COVID-19 wave. 4 lasted and gross profit margin decreased mainly due to increase in raw material and labor prices (1.6% vs. 6.1%). The company only completed 36% of the revenue target and 26% of the NPAT target in 9M2021.