PLX: Buy Call By SSI, 24,7% Up Swing Expected

SSI Securities Company has just issued an updated report on Vietnam National Petroleum Group (PLX) following the company reissued financial statements of H12019. The SSI’s report also called for BUY PLX shares.

•  PLX has reissued financial statements for H12019, net profit increased by 108 billion
• PLX is expected to be qualified for margin trading again soon
• Revenue and profit before tax in 2019 are forecast to continue to increase

Following the auditor's disclaimer in the previous financial statements, October 11, 2019 PLX reissued the consolidated financial statements for H12019. Accordingly, inventories reduced by VND 135 billion from VND 256 billion to VND 121 billion; Cost of goods sold decreased by VND 135 billion. Therefore, net profit increased by VND108 billion from VND2,528 billion to VND2,636 billion (up by 15% YoY).

After the adjustment, PLX’s gross profit margin of H12019 was 8.1%, improved from 7.6% in H12018 and the 5-year historical average of 7.8%, thanks to favorable oil price movements and increase in revenue from COCO channel in this period.

 PLX shares are expected to be qualified for margin trading again soon because there is no audit disclaimer after the company has reissued financial statements. SSI’s researchers believe that PLX's stock price might be supported once they are allowed to trade with margin.

SSI analysts also forecast PLX's revenue and profit before tax in 2019 of VND 196.5 trillion (+ 2.4% YoY) and VND 5.5 trillion (+ 7.3% YoY), respectively so they recommend Buy PLX with a one-year target price of VND 73,100 / share, up 24.7% compared to the closing price on October 14, 2019. This is in high end of price range suggested by securities companies. The consensus price for PLX by securities company is  67,720/share.

 

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