MWG Update- OUTPERFORM

The company generated a 121% YoY rise in EAT in 3Q, largely in line with our expectations but outperforming the estimates driven by stronger-than-expected TGDD & DMX’s sales growth in 3Q. We revise 2025 EAT projection up by 9% to VND6,550bn (+75.4% YoY) and target price by 9% to VND91,000/share by YE2026, equivalent to a 15.3% total return. Rating OUTPERFORM.

Net revenue and EAT climbed by 16.7% YoY and 121% YoY in 3Q2025, bringing MWG’s 9M2025 figures to VND113,607bn (+13.9%) and VND4,989bn (+73.2% YoY), respectively. 10M2025 net revenue was released at VND128,289bn (+15.2% YoY).

Vigorous EAT growth extended throughout three quarters of the year, driven by heightened efficiency following store network restructuring, with the SG&A-to-net revenue ratio improving. Besides, financial profit jumped by 51% YoY in 9M, giving the bottom line an extra push.

TGDD & DMX’s revenue upturn of 19.7% YoY in 3Q and 16.5% YoY in 10M2025 was bolstered by increased sales per store deriving from growth in most of their product categories, especially mobile phones, laptops, tablets, etc. The earlier iPhone sales season is a crucial element in the 3Q figures. Enhanced profitability thanks to a streamlined network continued to enable the chains to amplify the overall earnings.

BHX delivered 7.5% YoY revenue growth in 3Q and 13.3% in 10M2025 on the back of robust store network expansion. The expansion to the north is in progress, with Ninh Binh being the first province. Its profit continued to record QoQ and YoY improvements, reaching more than VND200bn in 3Q and more than VND400bn in 9M, getting closer to the company’s target of VND600bn for BHX in 2025.

The company reported that 48 across all chains in the Central region were adversely affected by the recent heavy flooding. The financial damages are being calculated for insurance claims and did not cause severe consequences. We anticipate the negative impacts in terms of sales and earnings in November to be immaterial given the minor affected number of stores.

Contribution from the joint venture Era Blue was a profit of VND4bn in 3Q, bringing 9M2025 figure to VND18bn (9M2024: -VND47bn), with 71 new stores opened in 10M.

For 2025, we project that the company may generate VND154,984bn of net revenue (+15.4% YoY) and VND6,550bn of EAT (+75.4% YoY), 4% and 9% respectively higher than our prior projections. The respective growth is expected at 11.8% and 17% YoY for 2026.

The IPO plan for ICT chains has experienced the first steps including rearranging subsidiaries and signing consulting contracts.