Forecasting market fluctuations for 2024-2025 and the outlook for Masan Group stock price.

Vietnam’s market fluctuation of 2024

SSI Securities analyzed in the July Strategy Report that the macroeconomic data in the second quarter and the first 6 months of the year continued to show a recovery trend, especially in the manufacturing and processing sector. It is likely that the management policy will focus on macroeconomic stability targets including exchange rates and interest rates in the second half of the year if GDP growth reaches and can exceed the 2024 plan. Inflation may continue to increase slightly.

SSI experts assessed that the Vietnamese stock market continues to have many bright colors when continuing the recovery momentum from November 2023 and continuing to improve in terms of scores. The VNIndex has grown positively by 10.2% since the beginning of the year despite experiencing a slight correction at the end of April and continuing to decline by 1.3% in June.

In June, the cash flow into global investment funds increased significantly due to the impact of monetary policy, typically the US stock market. In Vietnam, the strong net selling trend of foreign investors can be observed most clearly through ETFs with the dissolution of the iShares Frontier fund.

SSI assesses that the VN-Index will remain bright in the second half of the year and into 2025, especially when the economic situation continues to recover. The basic salary increase for the public sector will start from July 1; the consumer stimulus policy of reducing VAT by 2% will be extended until the end of the year; Export activities will be more favorable if the US recognizes Vietnam as a market economy at the end of July; obstacles in the upgrading process are still gradually being resolved.

Which sector to focus your investment in the last 6 months of 2024

With the market recovery and positive growth of listed companies, Mirae Asset has pointed out two prominent industry groups that investors can expect to reap positive results for the last 6 months of 2024.

First is the real estate industry. According to Mirae Assets' analysis, the Land Law 2024, Housing Law, Real Estate Business Law 2023 and 2 articles of the Law on Credit Institutions 2024, which will take effect early from August 1, 2024, will create a support corridor for real estate businesses with good project implementation capacity.

The second is the retail industry. The prospects of this industry group come from strong profit growth in 2024 thanks to the general purchasing power of the market and the restructuring of the business portfolio of large enterprises in the industry. In addition, the Government has just issued Decree 73/2024/ND-CP stipulating the basic salary and bonus regime for cadres, civil servants, public employees and armed forces. Accordingly, the basic salary is 2.34 million VND/month from July 1 instead of the current 1.8 million VND/month, which could bring prosperity to the retail industry.

3 special retail stocks recommended to watch for the second half of 2024 by AFA Vietnam include MSN of Masan Group, PNJ of Phu Nhuan Jewelry and DGW of Digital World Joint Stock Company. In which, Masan Group stock is a key one to look out and the Masan Group stock price is increasingly becoming quite attractive to investors.

Solid strategy, creating growth momentum for Masan Group stock price

A strong business strategy is key for boosting the Masan Group stock price. In 2024, Masan Group will focus on building the "family heirloom diamond" Masan Consumer (MCH) to become a source of pride in its journey to serve consumers. This will be the "culinary ambassador" that Masan brings to the world, seeking a steady step-by-step direction in the mission of bringing Vietnamese culture to 8 billion people around the world with strong brands.

MCH has successfully built 05 strong brands with annual revenue from 150 million to 250 million USD: Kokomi, Omachi, CHIN-SU, Nam Ngu and Wake-up 247, contributing to 80% of total revenue growth. Masan Consumer has grown at a rate 2.2x faster than the general market from 2017 to 2023. Mr. Truong Cong Thang, MCH’s CEO believes that this is just the first step in Masan Consumer's journey to conquer Vietnam's FMCG market. "Masan Consumer's strategic goal is to own 6 billion-dollar brands, implement the "Go Global" strategy and become the leading company in Southeast Asia in terms of revenue and profit growth thanks to the new FMCG model," he said.

Another important driver of Masan Group stock price is WinCommerce, WinCommerce with the WinMart supermarket chain, WinMart+ stores, and WiN is the largest modern retail chain in the country. Wincommerce's revenue reached 30,000 billion in 2023 and is expected to increase to 33,000 billion in 2024. Of which, the mini mart chain, which accounts for 75% of revenue, has doubled its sales in the period 2019 - 2023, and more than 2,000 stores have made a profit in EBITDA (nearly 10 times compared to the figure in 2019).

Since the end of 2023, WCM has rebuilt its pricing strategy, communicated prices to customers through store staff, as well as communicated on digital platforms about the prices of goods in WCM. Along with that, this retail business also ensures competitive prices compared to the market, bringing "good price" products to consumers in both urban and rural areas. In addition to the program of saving 20% ​​on MEATDeli chilled meat and WinEco clean vegetables for WiN members, WinCommerce regularly carries out periodic promotional programs, has been developing private label products including: Ngoc Nuong Rice, WinMart Good (dried food), WinMart Cook (processed food), WinMart Home (household appliances), WinMart Care (personal care) with prices 10-20% cheaper than products in the same segment on the market. Depending on the state of the consumer market, WinCommerce will open 400 - 1,000 new stores this year.

The Masan Group also owns businesses that have dominant positions in numerous industries, including Masan MEATLife (a meat value chain), Phuc Long (a F&B retail chain), Masan High-Tech Materials (high-tech industrial materials), and more, in addition to the two "growth engines" Masan Consumer and WinCommerce.

In 2024, Masan expects consolidated net revenue to be in the range of VND84,000 to VND90,000 billion, growing by 7% to 15% year-on-year. Core consumer businesses are still expected to be the main drivers of revenue growth. The WIN Membership Program will continue to focus on adding value to Masan’s businesses and partners. Core NPAT Pre-MI is expected to be in the range of VND2,290 to VND4,020 billion, up sharply from VND1,950 billion in 2023. These solid strategies will create strong momentum for Masan Group stock price.

Positive outlook for Masan Group stock price

According to observations, after a long period of down-turn, Masan stock price has increased by 37% since the beginning of November 2023. Foreign investors have also net bought this stock again in the most recent month.

In an updated report in early June, SSI Securities raised its 12-month target price for Masan Group stock price to VND93,400.

According to SSI, Masan's growth momentum will continue to be maintained in 2025, accordingly, MSN can reach VND98,000 billion in revenue (+9.8% YoY) and VND2,800 billion in core profit (+157% YoY). While MCH and TCB are expected to continue to maintain the current growth trend, the profits of other subsidiaries including WCM, MML and MSR will continue to improve and reduced interest expenses can act as a driver for profit growth.

Looking ahead, Masan's expected profit is forecast to improve quite well compared to the same period in Q2/2024. On the other hand, information related to MCH's plan to pay special cash dividends/list on HoSE or record the amount from HCS divestment will be factors supporting the stock price increase.