MWG Update- BUY

The company continued to deliver solid business performance in the first months of 2026, as net revenue jumped by c.29% YoY in 1Q and 4M2026 while EAT grew by 78.2% YoY in 1Q. We maintain 2026 EAT projection at VND9,919bn (+40.2% YoY), despite revising our target price down by 6% to VND109,500/share by YE2026 to reflect a higher cost of equity due to elevated bond yield. Maintain rating BUY.

Net revenue and EAT rose by 28.6% YoY and 78.2% YoY, to VND46,462bn and VND2,758bn in 1Q2026. 4M net revenue reached VND62,496bn (+28.5% YoY).

All major chains reported strong sales growth, including TGDD & DMX (+33.4% YoY in aggregate in 1Q and 32.9% YoY in 4M) and BHX (+19%/20%). While BHX expanded through continued robust network expansion, TGDD & DMX’s growth was fueled by increased revenue per store as a result of a partial recovery in demand, strengthening consumer financing programs and higher product prices attributed to new features/technologies and the memory chip shortage.

The EAT jump was further supported by heightened efficiency, with gross margin and the SG&A-to-net revenue ratio improving, while a 23% YoY increase in financial profit gave an additional push in 1Q. Besides TGDD, DMX and BHX, which are the key earnings contributors, An Khang also performed better as it narrowed its loss to near-breakeven, reducing the drag on overall EAT.

Network expansion in the joint venture Era Blue was on-track, with 222 stores in operation at the end of April (+123 stores YoY and +41 stores YTD). However, its profit contribution to MWG remained modest at VND9bn in 1Q2026 (up by three-fold YoY).

Dien May Xanh Investment JSC is offering 179.5m shares at VND80,000 per share in its IPO, 10% lower than our post-IPO valuation. The IPO starts from May 27th, 2026 to Jun 17th, 2026. If the IPO completes successfully, the company plans to list its shares on HOSE from Aug 2026.

We maintained our projections that the company may generate VND184,278bn (+18.2% YoY) in net revenue and VND9,919bn (+40.2% YoY) in EAT in 2026. While BHX is expected to continue to improve its profitability and expand the store network, management targets to support TGDD & DMX chains’ growth by optimizing store performance, promoting consumer financing services, expanding installation & maintenance services both internally and externally and developing customer relationship app into an integrated multi-service online platform, etc.