PTB – Maintain double-digit earnings growth momentum – Update

• PTB’s FY21 revenue grew 15.9% yoy, to VND6,492bn, while NP soared 42.9% yoy, fulfilling 94% of our FY21 earnings forecast.
• We forecast PTB’s NP to increase 21.1%/13.1% yoy in FY22/23F.
• Reiterate Add rating with lower TP of VND120,000.

Recovery across businesses in 4Q21
PTB posted 4Q21 revenue of VND1,788bn (+10.8% yoy) and net profit of VND129bn (+5.7% yoy). Wood revenue edge up 2.3% yoy, %23.3 qoq, to VND892bn as all wood manufacturing factories have resumed full operation since Nov-21 after 3-month lockdown in 3Q21. Stone revenue soared 21.5% yoy, 15.4% qoq, following the warming-up property market. Car distribution witnessed a slight recovery with VND477bn in revenue (+1.1% yoy, +182% qoq) thanks to increasing demand following the discount registration tax policy. Overall, FY21 revenue and NP achieved VND6,492bn (+15.9% yoy) and VND512bn (+42.9% yoy), fulfilling 92% and 94% of our forecasts, respectively.
Change to FY22-23F earnings forecasts
We lifted FY22F/FY23F stone revenue 5.1%/1.5% higher than previous forecasts thanks to strong recovery of condo market in the South and North. We lower FY22/23F wood revenue by 6.1%/6.1% versus previous forecasts due to (1) high base FY21 result and (2) the decrease in home improvement demand in US market as American workers tend to return the office. As a result, we expect PTB’s FY22/23F NP to grow 21.1%/13.1% yoy to VND620bn/VND702bn, slightly lower than our previous forecasts.
Is PTB still attractive after 82% price increase in FY21?
We revise down our TP by 6.9% following an FY22F EPS downgrade 5.0% with a SOTP- based TP of VND120,000. However, we still favor PTB for 2022-2023 investment horizon thanks to (1) positive FY22-23 revenue growth of both wood (+18.2%/+17.9%yoy) and stone segments (+31.4%/31.1% yoy), (2) the handover of remaining condo projects, and (3) core profit could maintain double digit growth of 15.7%/30.4% in FY22-23F. PTB is currently trading at FY22/23F forward P/E of 8.7x/8.0x, which is 17.6%/24.3% discount to 1-year average P/E. Thus, we reiterate Add rating.
Re-rating catalysts and downside risks
Re-rating catalyst is sustained strong US housing market that will buoy wooden furniture export. Downside catalyst is 1) Higher than expected logistic cost may affect the PTB’s gross profit margin, especially in stone segment and 2) weak domestic construction activities and car consumption due to Covid-19 pandemic

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