SIP Update – BUY

The 9M2026 results were solid, reaching 135% of the full-year profit target and 75% of our forecast. We maintain our 2026 projections and expect double-digit growth in 2027 profit given rising utility consumption by tenants, the annual allocation of industrial park (IP) land lease revenue, and financial income from strong upfront-rent cash flow. We reiterate our BUY rating with a year-end 2027 target price of VND68,000/share, supported by its sustainable earnings growth, IPs benefit from increased infrastructure investment and high cash dividend yield.

3Q2026 results were mixed. Revenue rose 9% YoY to VND2,426bn but NPAT declined 3% YoY to VND371bn mainly due to:
(1) Gross margin narrowed to 14.5% (3Q2025: 16.4%), due to the higher contribution from the low-margin electricity and water segment.
(2) Financial expenses rose 2.6 times to VND118bn, mainly because of higher interest expenses.
(3) The share of profit from associate Nam Tan Uyen fell to VND10bn from VND28bn.

9M2026 results continued to show stable growth. Revenue grew 11% YoY to VND7,003bn and NPAT rose 7% YoY to VND1,178bn, while gross margin remained broadly stable at 15.3%. The electricity and water segment (VND5,730bn, +11% YoY, 8.7% gross margin) grew mainly thanks to a 6.4% YoY increase in electricity volume supplied to tenants in IPs, to 2.6bn kWh. The higher-margin segments also expanded: Services in IPs rose 19% YoY to VND515bn (46% gross margin), and IP land lease revenue increased 10% YoY to VND342bn (69% gross margin).

Leasing slowed in 3Q2026 but was satisfactory for 9M2026. Only 4 ha were leased in 3Q2026, all at Dong Nam IP. For 9M2026, however, SIP leased a total of 52 ha (+79% YoY), completing 87% of its full-year target. As a result, long-term unearned revenue (rent collected upfront on leased land) rose VND1.64tn YTD to VND14.6tn. With Long Thanh International Airport expected to begin operations at the end of 2026, we expect leasing at Loc An – Binh Son IP to accelerate, as the IP is only 1 km from the airport. Le Minh Xuan 3 and Dong Nam IPs should also benefit from the completion of Ring Road 3 by 2027.

Financial health remains strong. As of 30 September 2026, SIP held VND13.8tn in cash, bank deposits and short-term investments, equal to 44% of total assets. During 9M2026, the net cash/equity ratio increased from 107.7% to 144.7%, and net cash/EBITDA from 3.8x to 4.7x. Both are well above the industry medians of 14.3% and 0.5x, respectively.

Outlook: We maintain our 2026 projections and forecast stable growth in 2027, with revenue of VND9,921bn (+7.6% YoY) and NPAT of VND1,801bn (+14.8% YoY).

Link to the full report: SIP_Update_10.11.2026