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4Q21 Earnings review – Earnings growth to slowdown

Strategy Note 10/02/2022    102


  • As at 09 Feb 2022, 764 listed companies on three bourses, representing 82.5% of market capitalisation, have released 4Q21 results.
  • 4Q21 market aggregate earnings increased encouragingly 15.5% yoy, slower than that of 17.8% yoy growth seen in 3Q21.

Earnings growth slow to 15.5% yoy in 4Q21, but still soar 42.4% yoy for FY21

Based on our estimates, 4Q21 aggregate earnings of listed companies on three bourses (HOSE, HNX, UPCOM) increased 15.5% yoy, lower than that of 3Q21 17.8% yoy. For FY21, aggregate earnings grew robustly 42.4% yoy. Out of the 43 companies under our coverage that have reported their 4Q21 results, in FY21, 46% were in line with our expectations while 42% beat our forecasts and 12% missed our estimates. Property firms and listed banks were mainly below our estimates.

In 4Q21, steel lose some glister; Property slump following VIC’s net loss

Steels manufacturers ‘s earnings grew 35.3% yoy in 4Q21, lower than that of 172.1% yoy growth seen in 3Q21 as 4Q21 steel average price dip 3.9% and coke price surged 47.1% vs. 3Q21. Among Financial sector, securities brokerage firms recorded 79.9% yoy in 4Q21 earning growth, contributing 1.6% to market earnings. Listed banks extended the downtrend in earnings growth with 34.3% yoy/13.1% yoy/8.4% yoy in 2Q/3Q/4Q21 respectively. On the other hand, Property 4Q21 earnings fell 38% yoy, mainly stemming from VIC’s one-off net loss of VND5,964bn in 4Q21. If excluded VIC’s extraordinary result, Property developers’ 4Q21 earnings softened 1.5% yoy, lower than that of 6.1% yoy seen in 3Q21. Electricity experienced the sharp drop in 4Q21 earning with -38.8% yoy growth due to lower power consumption and higher input prices.

Sectors that were hit hard by Covid-19 witnessed a significant recovery

Thanks to loosening movement control since Oct-21, Transportation, Food producers and Retail witnessed the sharp increase in 4Q21 earnings with +211.3%/+130.4%/+83.6% yoy, respectively. Other sectors experienced positive 4Q21 earnings growth including Construction (+58.3% yoy) and Technology (+45.4% yoy).

Global commodity prices hike created a positive impact to listed companies

At end-4Q21, S&P GSCI rallied 40.4% ytd and 0.6% qtd, fueling for the 4Q21 earnings growth of 4Q21 Mining (+148.3% yoy), Oil & Gas (+49.6% yoy) and Chemical (+76.4% yoy). The biggest earnings growth contributor is Food producers with 8.0%; mainly coming from the gain in selling assets of MSN.

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