PNJ Update – OUTPERFORM

The company reported surprising earnings growth of 66.8% YoY in 4Q2025, beating most of projections, facilitated by margin expansion. We project 2026 EAT at VND3,288bn (+16.2% YoY) and revise up our target price for the stock to VND132,000/share by YE2026, 28% higher than the prior update, respectively. Rating OUTPERFORM.

Net revenue and EAT rose by 12.1% and 66.8% YoY in 4Q2025, bringing PNJ’s 2025 (unaudited) figures to VND34,976bn (-7.5% YoY) and VND2,829bn (+33.9% YoY), respectively.

A surge of 26.5% YoY in retail revenue spurred the overall quarterly performance, despite weakness in the wholesale and 24K gold segments. The surge was largely price-led in line with elevated gold prices, complemented by sales and product initiatives, while volume growth was modest and the customer base was almost unchanged. On a cumulative basis, 2025 retail net revenue grew by 11.1% YoY.

The sharp increase in EAT in 4Q was fueled by gross margin expansion to 25.1% (4Q2024: 20.9%) and 22% for full-year 2025 (2024: 17.6%). This stemmed from realizing more benefits from cost optimization initiatives that had not been eligible for recognition in the previous quarters, fruitful gains from selling of inventories accumulated earlier at much higher selling prices in the context of escalating gold prices and the priority on jewelry over high-gold content products. We estimate that the 24K gold-excluded gross margin reached 27.6% in 4Q, better our prior projections.

The company introduced a new policy from Jan 5^th, 2026 to buy back selective product lines at gold market prices instead of fixed rates previously. The policy aims to favor the company’s materials sourcing while waiting for next moves from the government on granting gold importing quotas. However, this also suggests that the fruitful difference between inventory costs and selling prices may hardly repeat entirely in 2026 unless gold price extends its skyrocketed uptrend.

We project net revenue and EAT for PNJ at VND38,654bn (+10.5% YoY) and VND3,288bn (+16.2% YoY) in 2026, 3% and 32% higher than our prior EAT update, respectively considering the company’s proactive preparation for materials and the continued gold price uptrend.