- We increase our target price (TP) for BID by 1.5% to VND55,000/share and upgrade our rating from MARKET PERFORM to OUTPERFORM as the share price has decreased ~7% in the last three months. Our higher TP is due to (1) the positive impact of rolling our TP horizon forward to mid-2025F outweighing (2) a 9% decrease in our projected aggregate 2024-2028F NPAT-MI (decreases of 6%/6%/14%/11%/6% for 2024/25/26/27/28F, respectively).
- Our lower aggregate 2024-2028F NPAT-MI is primarily driven by a 6% aggregate decrease in NII following a downward revision in our average NIM assumption due to a weaker-than-expected Q1 2024 NIM. However, we maintain our expectation for NIM to gradually improve in the next three years due to the bank’s strategy to increase its retail lending contribution and the negative impact from lending rate support packages easing.
- We continue to model for BID to issue 513 million shares (equivalent to 9.0% of current outstanding shares) through private placements to take place by end-2024 (2.9% outstanding shares; assumed selling price at VND50,000/share) and mid-2025 (6.1% outstanding shares; assumed selling price at VND55,000/share) instead of one tranche in late 2024F as previously. The expected total proceeds are VND27.4tn (USD1.1bn). At its recent AGM, the bank stated that the investor(s) already have certain commitments and expect to proceed with a 2.9% stake sale this year.
Powered by Froala Editor
