Company Insight

Q1/2025, HPG recorded net revenue of VND 37,621 billion (+9% QoQ, +22% YoY), and net profit after tax of VND 3,349 billion (+19% QoQ, +17% YoY). Steel sales volume in Q1/2025 increased significantly (+24% YoY) across most product categories, except for galvanized steel: (1) Construction steel reached 1.19 million tons (+3% QoQ, +25% YoY) – a positive result given that Q1 is typically a low-demand season; (2) HRC reached 994 thousand tons (+51% QoQ, +23% YoY) thanks to the commencement of operations at Dung Quat 2 Phase 1 in March and the implementation of AD20 tariffs at the same time; (3) Steel pipes reached 186 thousand tons (-9% QoQ, +24% YoY); (4) Galvanized steel reached 89 thousand tons (-12% QoQ, -9% YoY). Gross profit margin reached 14.4% (+0.9 percentage points YoY, in line with our 2025 forecast), supported by higher sales volume and selling prices amid favorable input costs. Additionally, HPG's agricultural segment revenue increased by 31% YoY due to rising pig prices as a result of the African swine fever outbreak.

Using the P/E and DCF valuation methods with equal weighting of 50% each, we update our target price for HPG stock to VND 31,300, corresponding to an expected return of 22%.