Vietnam retail sector leads Q3 earnings growth, mid-caps yield highest returns: brokerage

By Ta Phu, Hai Yen
Fri, November 8, 2024 | 12:02 pm GMT+7

Earnings of stock exchange-listed companies in Vietnam are estimated to rise 18.8% year-on-year in Q3/2024, with the retail sector taking the lead, according to a report by Hanoi-based VnDirect Securities.

The companies are publicly traded on three bourses in Vietnam: Ho Chi Minh City Stock Exchange, Hanoi Stock Exchange, and the Unlisted Public Company Market.

Profits of retailers rose 142% year-on-year, primarily driven by Mobile World Investment Corporation (HoSE: MWG), which reported a 1,965% surge in net profit. This growth was attributed to higher revenue per store and the closure of underperforming outlets.

However, the sector's Q3 net profit declined over 32% from Q2, ending a four-quarter streak of continuous growth.

 The Gioi Di Dong and Dien May Xanh stores of MWG. Photo courtesy of Tuoi Tre (Youth).

The Gioi Di Dong and Dien May Xanh stores of MWG. Photo courtesy of Tuoi Tre (Youth).

The electricity sector was the runner-up with a 124% profit growth, fueled by hydropower stocks benefiting from La Nina and PV Power's (HoSE: POW) unrealized exchange rate gain of VND265 billion ($10.47 million), which sent POW’s net profit nearly quadrupling.

The personal and household goods sector saw profit hike by 112% year-on-year as the global economic recovery boosted export orders.

Notably, the real estate sector ended a four-quarter streak of contraction, posting a 16.2% increase in revenue and a 49.3% jump in profit compared to the same period last year. This improvement was driven by a recovering real estate market, rising land prices, and earnings from projects.

The oil and gas industry, on the other hand, suffered due to fluctuations in oil prices, incurring a 119% plummet in Q3 profits. Binh Son Refining and Petrochemical Company Limited (UPCoM: BSR), in particular, reported a loss of VND1.2 trillion ($47.4 million), due to a narrowing crack spread and weakened consumption.

In Q3, stock returns across these sectors experienced positive growth, led by mid-cap stocks with a 30.5% rise in returns year-on-year.

Among the VN30 companies, which represent the top 30 largest stocks by market capitalization and liquidity on the HoSE, 22 recorded net profit growth in July-September. Noteworthy increases included MWG (1,965%), Masan Group Corporation (1,349%), POW (380%), VietJet (323%), and Vietnam Rubber Group JSC (202%).

In contrast, Vietnam National Petroleum Group (HoSE: PLX) experienced a 91% decline in Q3 profit due to lower oil prices and the absence of extraordinary financial gains.

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