SAO VANG RUBBER JOINT STOCK COMPANY

Transcription

1 MB SECURITIES CORPORATION RESEARCH CENTER EQUITY RESEARCH SAO VANG RUBBER JOINT STOCK COMPANY Ha Noi, June 26, 2014

2 CONTENTS SUMMARY REPORT... 3 FINANCIAL RATIOS... 5 INCOME STATEMENT... 6 BALANCE SHEET... 7 CASH FLOW STATEMENT... 8 STOCK VALUATION INDEX METHODOLOGY DISCOUNTED FREE CASH FLOW OF EQUITY DISCOUNTED FREE CASH FLOW OF FIRM TECHNICAL ANALYSIS... 12

3 SUMMARY REPORT Key metrics: Do Bao Ngoc Senior Analyst Name: Sao Vang Rubber Joint stock company Chartered Capital: VND 182,249,940,000 Market cap: VND 368,144,878,800 Sector: Tire Listed on: HSX Ticker: SRC Outstanding shares 18,224,994 shares Foreign ownership 2.19% Price fluctuation of stock: Price on 26/06/2014: week highest VND: week lowest VND: % change in 1 month: -6.5% % change in 3 months: -13.3% % change in 6 months 3.6% % change in 1 year: 13.5% Average trading volume of 1 month Average trading volume of 3 months Average trading volume of 6 months Ratios: EPS (vnd) 140 2,934 3,592 BV (vnd) 13,186 15,477 16,185 Dividen (vnd) 500 1,250 2,000 Dividen yields 10,0% 10,4% 10,3% ROA (%) 0,3% 8,9% 12,5% ROE (%) 1,1% 19,0% 22,2% Valuation based on financial analysis: P/E Method: 31,609 P/B Method: 26,984 FCFE Method: 27,397 FCFF Method: 31,947 Target price in 2014: 28,500 Recommendation technical analysis Recommendation:: BUY Price on 26/06/2014: 20,200 Short term trend: Decreasing Middle term trend: Increasing Long term trend: Increasing Buying price: 19,000 20,000 Target price: 25,000 28,500 Cut loss price: <17,500 Note: Recommendations will be updated to catch up with market performance, which helps investors to maximize profits, Recommendations: In recent years, rubber business such as SRC has benefits from the deduction of natural rubber prices. The cost of raw materials reduce that makes the profit margin of these company increased in the downturn economic. In 2014, cost of natural rubber will remain at a low level. The first six months, the cost has been fallen more than 10% compared with it was in the end of 2013, and it will continue to decrease, thus SRC s income from operating activities is still expected to grow in Compared with other companies such as CSM and DRC, SRC is at a lower valuation. By using the basic valuation methods, SRC s fair value at the end of 2014 will be 28,500 VND/share, and with technical analysis, we recommend buying this stock at 19,000-20,000 VND/share. The position of enterprises in the sector: Sao Vang Rubber Joint Stock Company, formerly Sao Vang Rubber Factory which was established on May 23, On August 27, 1992 Sao Vang Rubber Factory changed to be Sao Vang Rubber Company, converted into a joint stock company on October 24, 2005, and officially listed on the HOSE with its listed name as Sao Vang Rubber Joint Stock Company (SRC). Sao Vang Rubber Joint Stock Company s operating activities are: manufacturing and trading rubber products as well as importing and exporting machinery, equipment and chemicals for the rubber industry. SRC main products include: Tires and tubes for bicycle, motorcycle and car and Technical Rubber such as rubber tubes, rubber conveyor belts and rubber mats for ships, etc. SRC exchange with both domestic (90%) and international market (10%). Its domestic market includes most cities in Vietnam, in which sales from Hanoi and HCM City reached over 10% of total SRC sales in SRC s exporting markets are Angola, Cambodia, the Philippines, Egypt, USA, and Bangladesh. SRC's main Revenue is from producing tires and tubes. SRC is the third largest market share company, behind the Southern Rubber Industry Joint Stock Company (CSM) and Da Nang Rubber Joint Stock Company (DRC). SRC s strength is bicycles and motorbikes tires, CSM is good at producing motorcycles tires and automotive tubes, and DRC focus on truck s, oversize vehicles and specialized vehicles. Generally, the top three companies production account for 78% of the domestic market, in which SRC is 10%, CSM is 33%, DRC is 25%, and other companies as well as imported products are about 32%. All of three companies SRC, DRC and CSM are members of Vietnam National Chemical Group (Vinachem) and have a great advantage in the tire manufacturing industry. In addition, tire supply hasn t met domestic demand yet, thus maintaining the companies position in the sector are appreciated. Compared with the CSM and DRC, SRC is slower in expanding the manufacturing new produces with modern technology. This is SRC s drawback and it affects the company position in the long-term competitive business. Both CSM and DRC have already developed radial tires factory and tubeless tires while SRC hasn t experienced radial tires. However, SRC is testing and producing tubeless tires, and introducing a new tires products for electric bicycle coming in Q3/2014. Due to the limitations on the size and structure, it s hard for SRC to compete with DRC and CSM. By having 1,000 billion VND chartered capital for investing in radial tires technology and manufactory, DRC and CSM have an advantage in tires for trucks and large load vehicles. In contrast, with a chartered capital of 180 billion VND, SRC has a strength in producing tires for bicycle, motorcycle and small car. The company is not able to invest in radial tire production, and SRC is slowly promoting tubeless tire segment while the demand of this product is increasing. Besides the operating activity, SRC has owned a large area of 6.3 hectares with over 250m frontage at 231 Nguyen Trai Street, Thanh Xuan District, Ha noi. This land, which is in a beautiful location for real estate projects, is considered as "a gold". SRC is planning to relocate its manufactory to take advantage of this land for investing cooperation in building plazas, offices and houses. That will be a better use of its assets and bring greater benefits and revenues in the future. Through business trip, we have known that SRC will not implement the relocation plan in SRC is still in the process of planning and there is no specific strategy for the land. Therefore, taking advantage of 231 Nguyen Trai Street area is SRC s long-term plan. Business results in the period : - Revenue increased from 926 billion VND in 2008 to 983 billion VND in 2013, achieving an average growth rate of 1.8%/year. During SRC s revenue increased from 926 billion VND to 1,218 billion VND, reached an average growth rate of 9.7%/year. However, during , annual revenues decreased 10% that makes revenue growth rate for the whole period of 2008 to 2013 is only 1.8%/year.

4 - Even though Revenue declines in , profit margins is increasing because the raw materials prices fell sharply. Income after tax reached 48 billion VND in 2012 and 65 billion VND (increasing 37.7%) in Profit margin before tax increased from 0.1% in 2008 to 8.9% in 2013, and got 11.1% in Q1/2014. Profit Margins will be expected to grow in Q2/2014. In year of 2008, 2010 and 2011, SRC s Profit. - Margin is low about 0.1% - 1.2% because the cost of natural rubber was high. The profits from operating activities is 92% to 99% of Profit before tax, showed the concentration of SRC's operating activities. Evaluating SRC s business results in 2013 and ability to complete financial plan in 2014: Figures Units 2013 %Completed Plan 2014 Growth Revenue Bil, vnd % 1, % Profit after tax Bil, vnd % % Overall, In 2013 SRC completed 76.4% of its Target Revenue, however SRC exceeded 34.4% of Profit before Tax because the price of raw materials declined in 2013, which led to SRC s COGS significantly reduced and Revenue increased. SRC s Revenue Structure in 2013: Sectors Net revenues Structure Gross profit Structure Bil, vnd Gross profit margin Sales % % 18.6% Service % % 100.0% Sales material % 0 0.1% 17.4% Total % % 19.4% SRC s Sales structure in 2013: - Bicycle tire products: 16.6% - Motorcycle tire products: 24.5% - Auto-mobile tires: 52% - Other rubber products: 6.9% Motorcycle tire and automotive tires for small car are main products generate revenues for SRC. During Q3-Q4/2014, SRC will introduce electric bicycle tires to meet market demands and increase sales. Its target in 2014 In 2014, SRC s target Revenue is 1,037 billion VND, increasing 5.5%. Profits before tax is 71 billion VND, decreasing 18.7%. This is a careful plan which consider the company limitations, new products risks and structural changes in the competitive market. However, after the first 6 months of 2014, the volatility of raw materials impact positively in SRC. Raw natural rubber cost decreased over 10%. In Q1/2014, SRC Revenue reached 208 billion VND, Profit after tax reached more than 18 billion VND as much as it achieved in On June 25, 2013, MBS research group paid a visit to SRC. The first six months, SRC leaders expected to reach 50 billion VND for profit before tax and 40 billion VND for profit after tax. According to SRC s ability, in 2014, SRC is expected that Sales will reach 1,050 billion VND, Profit after-tax will be 75 billion VND and EPS will be 4,109 VND/share.

5 FINANCIAL RATIOS FINANCIAL RATIOS Liquidity ratios Current ratio Quick ratio Cash ratio Activity ratios Receivables turnover Average number of days debt recovery Inventory turnover Average number of days inventory Asset turnover Fixed assets turnover Equity turnover Debt ratios Short-term asset/total asset 45.8% 52.2% 52.1% 60.5% 65.1% 72.3% 72.2% 75.6% Long-term asset/total asset 54.2% 47.8% 47.9% 39.5% 34.9% 27.7% 27.8% 24.4% Debt ratios 82.5% 66.9% 74.3% 58.6% 58.4% 67.7% 53.0% 43.8% Debt/ Equity 471.4% 201.7% 289.0% 141.3% 140.2% 209.2% 112.9% 78.0% Short-term liabilities/ Asset 63.6% 54.2% 60.5% 52.3% 53.9% 63.6% 50.3% 40.6% Short-term liabilities/ Short-term asset 138.8% 104.0% 116.1% 86.5% 82.8% 88.0% 69.6% 53.8% Short-term liabilities/ Equity 363.3% 163.6% 235.4% 126.3% 129.4% 196.7% 107.0% 72.3% Long-term liabilities/ Asset 18.9% 12.6% 13.8% 6.2% 4.5% 4.1% 2.8% 3.2% Long-term liabilities/ Long-term asset 34.9% 26.4% 28.8% 15.8% 12.8% 14.6% 10.0% 13.0% Long-term liabilities/ Equity 108.1% 38.1% 53.7% 15.0% 10.8% 12.5% 5.9% 5.7% Profitability ratios Gross profit margin 13.3% 11.4% 9.8% 18.8% 9.6% 8.5% 15.5% 19.4% Operating net income ratios 1.7% 2.8% 0.0% 10.7% 1.4% 0.2% 5.7% 8.8% Other profit ratios 0.3% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.0% Earnings Before Taxes ratios 2.0% 2.9% 0.1% 10.7% 1.5% 0.2% 5.8% 8.9% Net income ratios 2.0% 2.9% 0.1% 9.4% 1.3% 0.2% 4.4% 6.7% Return on asset (ROA) 2.0% 5.5% 0.1% 17.6% 2.5% 0.3% 8.9% 12.5% Return on equity (ROE) 11.7% 16.6% 0.6% 42.5% 6.1% 1.1% 19.0% 22.2% Other profit/ Earnings Before Taxes 14.1% 3.2% 74.1% 0.7% 8.0% 26.0% 2.2% 0.4% Operating net income/ Earnings Before Taxes 85.9% 96.8% 25.9% 99.3% 92.0% 74.0% 97.8% 99.6% Share value Earning per share (EPS) 1,612 2, ,488 1, ,934 3,592 Dividend 1,200 1, ,250 2,000 Dividend ratios 12.6% 130.5% 357.1% 42.6% 55.7% Dividend yields 4.0% 7.6% 10.0% 10.4% 10.3% Dividend growth #DIV/0! 25.0% -66.7% 150.0% 60.0% Book value per share (BV) 10,203 14,517 13,290 22,324 14,668 13,186 15,477 16,185 P/E P/B

6 INCOME STATEMENT INCOME STATEMENT Bil. Vnd Structure Q1/ Q1/2014 Gross sales 1,096 1,153 1,218 1, % 100.0% 100.0% Less Deductions % 0.1% 0.1% Net Revenues 1,093 1,152 1,212 1, % 99.9% 99.9% Cost of Goods Sold 888 1,042 1, % 80.5% 80.6% Gross Profit % 19.4% 19.3% Financial Revenues % 0.1% 0.1% Financial Expenses % 2.3% 1.8% Interest expenses % 1.6% 1.3% Selling Expenses % 2.7% 1.9% General and Administrative Expenses % 5.6% 4.7% Operating net income % 8.8% 11.1% Other income % 0.1% 0.1% Other expense % 0.0% 0.0% Other profit % 0.0% 0.1% Net income from JVC % 0.0% 0.0% Earnings Before Taxes % 8.9% 11.1% Payable Income taxe expenses % 2.2% 2.4% Deffered income taxe expenses % 0.0% 0.0% Net income % 6.7% 8.7% Minority interests % 0.0% 0.0% Net Income for common Shareholders % 6.7% 8.7% ANNUAL GROWTH Gross sales 84.3% 3.2% 18.4% 5.2% 5.6% -10.1% -10.2% Less Deductions -58.8% 381.6% -43.4% -65.8% 415.6% 7.0% -91.1% Net Revenues 85.2% 2.7% 18.8% 5.4% 5.2% -10.2% -9.7% Cost of Goods Sold 89.4% 4.5% 7.0% 17.3% 6.4% -17.0% -14.0% Gross Profit 58.4% -11.3% 126.6% -46.3% -5.9% 62.7% 13.3% Financial Revenues 176.1% 49.0% 41.1% 17.0% 9.5% -53.7% 27.3% Financial Expenses 11.6% 78.2% -41.0% 55.7% 17.4% -16.2% -46.3% Interest expenses 12.6% 55.3% -42.4% 28.7% 53.9% -13.6% -59.8% Selling Expenses 34.1% -6.0% 9.5% -5.8% -19.0% 21.2% 9.4% General and Administrative Expenses 87.7% -21.3% 79.9% -22.5% 16.8% 25.4% 37.5% Operating net income 206.4% -98.8% % -86.3% -86.0% % 40.2% Other income 53.0% -55.0% 1.8% 47.3% -27.2% 37.3% -53.4% Other expense 948.4% -87.7% 21.7% -35.6% 139.5% -60.6% 156.6% Other profit -37.5% 0.2% -2.3% 68.8% -43.7% 78.5% -72.9% Net income from JVC Earnings Before Taxes 172.0% -95.6% % -85.2% -82.6% % 37.7% Payable Income taxe expenses #DIV/0! #DIV/0! % -80.7% -73.6% % 37.7% Deffered income taxe expenses Net income 172.0% -97.0% % -85.9% -84.4% % 37.7% Minority interests Net Income for common Shareholders 172.0% -97.0% % -85.9% -84.4% % 37.7%

7 BALANCE SHEET BALANCE SHEET Bil. Vnđ Structure Q1/ Q1/2014 SHORT-TERM ASSETS % 75.6% 77.2% Cash and cash equipvalents % 8.0% 5.0% Short-term financial investments % 0.0% 0.0% Accounts receivable % 13.7% 19.6% Inventories % 53.7% 52.3% Other current assets % 0.1% 0.3% LONG-TERM ASSETS % 24.4% 22.8% Long- term accounts receivable % 0.0% 0.0% Fixed assets % 21.8% 20.5% Real Estate Investments % 0.0% 0.0% Long-term financial investments % 1.9% 1.9% Other long-term assets % 0.6% 0.4% TOTAL ASSETS % 100.0% 100.0% LIABILITIES % 43.8% 40.7% Short-term liabilities % 40.6% 38.1% Short-term borrowing % 25.4% 23.4% Accounts payable - Trade % 5.7% 5.6% Advance from Buyers % 0.6% 0.9% Long-term liabilities % 3.2% 2.6% LT borrowings % 1.8% 1.3% OWNERS' EQUITY % 56.2% 59.3% Paid - in capital % 34.7% 34.6% Surplus share capital % 0.0% 0.0% Treasury stocks (0) (0) 0.0% 0.0% 0.0% Retained earnings % 13.3% 16.6% Others reserve fund % 8.2% 8.2% TOTAL RESOURCES % 100.0% 100.0% ANNUAL GROWTH SHORT-TERM ASSETS 14.8% 17.9% 21.1% 5.4% 28.6% -19.3% 3.0% Cash and cash equipvalents 138.8% -64.9% 447.0% -34.0% -44.9% 95.9% 41.3% Accounts receivable 19.5% -2.1% 24.7% -12.4% 52.9% -37.9% 18.4% Inventories 4.3% 36.7% 6.4% 16.7% 31.3% -17.7% -4.1% Other current assets 151.4% 15.7% -28.8% 98.9% -9.8% -91.2% 13.5% LONG-TERM ASSETS -11.0% 18.2% -14.2% -13.2% -8.2% -19.0% -13.6% Fixed assets -10.9% 17.7% -14.4% -16.4% -9.7% -20.8% -15.5% Long-term financial investments -19.9% 16.2% 618.0% 424.3% 24.5% -6.6% -4.9% Other long-term assets -29.9% 386.1% -64.4% -58.7% -7.5% 735.3% 75.8% TOTAL ASSETS 0.8% 18.0% 4.2% -1.9% 15.7% -19.2% -1.6% LIABILITIES -18.3% 31.2% -17.9% -2.2% 34.2% -36.7% -18.7% Short-term liabilities -14.0% 31.7% -9.9% 1.0% 36.6% -36.2% -20.5% Short-term borrowing -30.3% 67.2% -34.1% 15.9% 61.3% -41.9% -37.1% Accounts payable - Trade 107.6% -38.0% 164.8% -25.5% -24.1% -55.0% 118.2% Advance from Buyers 216.0% -70.9% 15.8% 6.3% 5.4% -42.3% 19.5% Long-term liabilities -32.6% 28.9% -53.0% -29.3% 4.6% -44.8% 13.0% LT borrowings -32.8% 28.0% -54.4% -31.6% 3.1% -40.0% -34.2% OWNERS' EQUITY 90.9% -8.4% 68.0% -1.4% -10.1% 17.4% 17.6% Paid - in capital 34.2% 0.0% 0.0% 50.0% 0.0% 0.0% 12.5% Surplus share capital % 0.0% 0.0% % 0.0% 0.0% 0.0% Retained earnings % -80.2% % -47.2% -62.0% 201.4% 55.4% Others reserve fund % 2.7% 235.4% 6.9% 3.2% 17.1% -2.0% TOTAL RESOURCES 0.8% 18.0% 4.2% -1.9% 15.7% -19.2% -1.6%

8 CASH FLOW STATEMENT CASH FLOW STATEMENT Bil. Vnđ CASH FLOW FROM OPERATING ACTIVITIES Net profit/(loss) before tax Adjusted Depreciation and Amortisation Provisions 5 (7) (1) (2) 4 (0) Unrealised foreign exchange (gain)/loss (0) 0 (Profit)/loss from disposal of fixed assets (Profit)/loss from investing activities (1) (1) Net income from JVC Interest expense Interest income and dividends Operating profit/(loss) before changes in WC (Increase)/decrease in receivables 2 (18) 8 (35) 41 (12) (increase)/decrease in inventories (64) (9) (39) (85) Increase/(decrease) in payables (38) 57 (23) (29) (2) 31 (Increase)/decrease in prepaid expenses (1) 1 0 (0) (0) (1) Interest paid (42) (20) (32) (45) (41) (17) Business Income Tax paid (1) (5) (12) (1) (14) (20) Other receipts from operating activities Other payments on operating activities (4) (49) (6) (9) (2) (3) Net cash inflows(outflows) from operating activities (59) (93) CASH FLOW FROM INVESTING ACTIVITIES Purchases of fixed assets and other long term assets (24) (12) (13) (16) (4) (3) Proceeds from disposal of fixed assets Loans granted, purchases of debt instruments Collection of loans, proceeds from sales of debts instruments Investments in other entities (0) (2) (7) (2) 0 0 Proceeds from divestment in other entities Dividends and interest received Net cash inflows/(outflows) from investing activities (23) (12) (19) (16) (3) (2) CASH FLOW FROM FINANCING ACTIVITIES Proceeds from shares issue Payments for share repurchases (0) Proceeds from borrowings , Repayment of borrowings (462) (560) (746) (890) (815) (610) Finance lease principal payments (7) (11) (11) (11) (11) (9) Dividends paid (6) (9) (13) (24) (8) (20) Earned Profit Net cash inflows/(outflows) from financing activities 67 (164) (7) 97 (175) (112) Net increase in cash and cash equivalents (14) 34 (14) (12) Cash and cash equivalents at the beginning o period Cash and cash equivalents at the beginning o period (0) 0 Cash and cash equivalents at the end of period

9 STOCK VALUATION 1. INDEX METHODOLOGY P/E INDEX TTM Q1/ F EPS 0 1,612 2, ,488 1, ,934 3,592 4,109 P 30,300 19,700 5,000 12,000 19,500 22,800 P/E P/E Industry P/E HOSE P/E HNX P/Ef 7.69 Pf 31,609 P/B INDEX Q1/ F BV #DIV/0! 10,203 14,517 13,290 22,324 14,668 13,186 15,477 16,185 20,294 P ,300 19,700 5,000 12,000 19,500 22,800 P/B P/B Industry 1.70 P/B HOSE 3.10 P/B HNX 1.60 P/Bf 1.33 Pf 26,984

10 2. DISCOUNTED FREE CASH FLOW OF EQUITY Assumptions Long-term bond yields Rf 9.0% Market interest rates Rm 14.0% Beta β 1.28 Discount rate (CAPM) k 15.4% FCFE Figures EBIT Bil. Vnd Investments Bil. Vnd Depreciation Bil. Vnd Working capital change Bil. Vnd 0.0 (92.6) 60.9 (23.0) Net borrowing Bil. Vnd (143.1) (156.1) Reinvestment rate % #DIV/0! % 116.4% % 114.6% -25.9% % 159.9% ROE % #DIV/0! 11.7% 16.6% 0.6% 42.5% 6.1% 1.1% 19.0% Income growth % #DIV/0! -32.8% 19.3% -1.6% 48.7% -1.6% -3.3% 30.3% FCFE Bil. Vnd (8.6) (20.6) (62.1) EBIT Bil. Vnd Investment Bil. Vnd Depreciation Bil. Vnd Working capital change Bil. Vnd (5.0) Net borrowing Bil. Vnd (83.0) (39.9) (28.7) (29.3) (17.4) (17.8) (18.1) (18.5) Reinvestment rate % 104.4% 67.8% 66.2% 74.8% 55.9% 47.4% 38.9% -7.7% ROE % 22.2% 24.9% 24.4% 23.9% 23.4% 23.0% 22.5% 22.1% Income growth % 23.2% 16.9% 16.1% 17.9% 13.1% 10.9% 8.8% -1.7% Bil. Vnd (4.6) PV FCFE Bil. Vnd (4.6) Total FCFE Bil. Vnd Number of shares Mil. Shares 18.2 Price forecast Vnd 27,397

11 3. DISCOUNTED FREE CASH FLOW OF FIRM Assumptions Long-term bond yields Rf 9.0% Market interest rates Rm 14.0% Beta β 1.28 Discount rate (CAPM) k 15.4% FCFF Figures EBIT Bil. Vnd Investment Bil. Vnd Depreciation Bil. Vnd Working capital change Bil. Vnd 0.0 (92.6) 60.9 (23.0) (0.1) 45.4 Reinvestment rate % #DIV/0! % 116.4% -94.5% 37.8% -53.0% -56.1% 9.3% ROE % #DIV/0! 11.7% 16.6% 0.6% 42.5% 6.1% 1.1% 19.0% Income growth % #DIV/0! -32.8% 19.3% -0.5% 16.1% -3.2% -0.6% 1.8% FCFF Bil. Vnd (0.0) (8.6) EBIT Bil. Vnd Investment Bil. Vnd Depreciation Bil. Vnd Working capital change Bil. Vnd (5.0) Reinvestment rate % 24.2% 34.1% 41.9% 50.0% 41.2% 32.4% 32.0% -23.3% ROE % 22.2% 24.9% 24.4% 23.9% 23.4% 23.0% 22.5% 22.1% Income growth % 5.4% 8.5% 10.2% 12.0% 9.7% 7.4% 7.2% -5.1% FCFF Bil. Vnd PV FCFF Bil. Vnd Total PV FCFF Bil. Vnd Number of shares Mil. Shares 18.2 Price forecast Vnd 31,947

12 TECHNICAL ANALYSIS Price fluctuation of stock: Recommendation technical analysis Price on 26/06/2014: week highest VND: week lowest VND: % change in 1 month: -6.5% % change in 3 months: -13.3% % change in 6 months 3.6% % change in 1 year: 13.5% Average trading volume of 1 month Average trading volume of 3 months Average trading volume of 6 months Recommendation:: BUY Price on 26/06/2014: 20,200 Short term trend: Decreasing Middle term trend: Increasing Long term trend: Increasing Buying price: 19,000 20,000 Target price: 25,000 28,500 Cut loss price: <17,500

13 RECOMMENDATION: MBS recommendation system is the difference between the price and the market price at the issued time up to 6 months. There are 3 levels for each stock recommendations which can be changed to fit the companies situation: SALE: when the market price is above 15% HOLD: when market prices are +/-15% BUY: when the market price is under 15% DISCLAIMER: Copyrights. MBS ALL RIGHTS RESERVED. Authors have based this document on information from sources they believe to be reliable but which they have not independently verified. The views expressed in this report are those of the authors and not necessarily related. by any sense. to those of MBS. Neither any information nor comments were written for advertising purposes or recommendation to buy / sell any securities. No part of this publication may be reproduced. stored in a retrieval system. or transmitted. on any form or by any means. electronic. mechanical. photocopying recording. or otherwise. without the prior written permission of MBS. MB SECURITIES (MBS) Established since May MBS was one of the first 5 securities firms operating in Vietnam. After years of continuous development. MBS has become one of the leading securities company in Vietnam. providing a full range of services including: brokerage. research and investment advisory. investment banking and capital markets underwriting. MBS s network of branches and transaction offices has been expanded and operated effectively in many major cities such as Hanoi. Ho Chi Minh City. Hai Phong and other strategic areas. MBS s clients include individual investors and institutions. financial institutions and enterprises. As a member of the MB Group. including MB Bank. MB Land. MB Asset Management. MB Capital and Viet R.E.M.A.X (Viet REM). MBS is able to leverage substantial human. financial and technological resources to provide its clients with tailored products and services that few securities firms in Vietnam can match. MBS is proud to be recognized as: - A leading brokerage firm ranked No.1 in terms of brokerage market share since 2009; - A renowned research firm with a team of experienced analysts that provides market-leading research products and commentaries on equity markets and the economy; and - A trusted provider of investment banking services for corporate clients. MBS HEAD OFFICE MB Building. 3 Lieu Giai. Ba Dinh. Ha Noi Tel: Fax: Website: