We attended MWG’s analyst meeting on Tuesday, August 19. The key takeaways are as follows:
Group level:
- To achieve 2025 VND5tn NPAT guidance by the end of October.
- July 2025 revenue posted the strongest YTD growth of 16% YoY (TGDD & DMX +21% YoY; BHX +6% YoY, +4% MoM)
- The Qua Tang VIP app generated VND7tn of revenue in 7M 2025.
BHX: Aggressive growth target after finding profitable economics for new stores
- Q2 2025 profitability improved despite lower sales/store QoQ due to cost optimization. July and August sales/store improved MoM again.
- 2025 NPAT: Q2 VND182bn, H1 VND205bn, full-year target revised up from VND500bn to VND600bn.
- Aims to clear VND8tn of accumulated losses to meet regulations for an expected IPO in 2028.
- Store openings: 420 YTD, targets 620 for 2025, 1,000/year for 2026-2030.
- 2026 capex guided at lower than VND2.5tn. Capex/store lowered due to a focus on only one store format vs previous flexibility for store expansion.
- Distribution center cost improved from 5% of sales to lower than 3% during the last two years. Logistics cost also hit 3% of sales.
- 2025 to focus on central region store openings. 2026 to begin open stores in the north.
- We observe that the race for modern grocery retail market share is accelerating among the two leading players. This is amid both of them finding profitable economics for new stores and stricter tax compliance regulations on the GT channel.
- The long-term USD10bn revenue target requires at least 15,000 stores and different store formats (e.g., pure fresh, pure FMCG, apartment building stores).
- Mature NPM target of 4-5%, similar to TGDD & DMX.
TGDD & DMX: Reviving mid-teen earnings growth with quality services
- Q2 2025 revenue grew 12% YoY due to SSSG.
- Q2 2025 sales growth by segment: Phones, laptops, and tablets: 20%-50%, washing machines and wearables: 10-20%, TVs & refrigerators: 0-10%, AC: declined. Apple products grew 60% YoY, helping market share reach 50%.
- 2026-2030 plan: To accelerate revenue growth and expand profit margin with after sales services (e.g., offer repair beyond brand warranty periods in exchange for an upfront fee, offer upgrades of old products at a discount).
- Revenue growth target: 15% in 2025, and low-teens in the medium term. NPAT growth target: 15% for 2026-2030.
Other:
- EraBlue hit 120 stores and will achieve 150 store by YE2025. It targets 500 stores and a future IPO.
- Avakids has continued to be profitable for every month YTD. It aims to further increase the online sales contribution from the current 50% and have minimal offline store openings.
- An Khang is reducing losses gradually.
- Treasury share purchase is pending for six months after ESOP, as regulated; maximum price of VND100,000/share.
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