Company Insight

Initial Valuation with a BUY Recommendation, Target Price of 37,800 VND

Thanh Cong Textile Garment Investment Trading Joint Stock Company (HOSE: TCM) is one of the leading textile and garment enterprises in Vietnam with closed production cycle from yarn-weaving/knitting-dyeing-sewing-distribution. TCM is currently in the top 3 listed textile and garment enterprises with the largest capitalization on HOSE. We assess TCM's medium and long-term business prospects as positive based on the following factors: (1) The closed production cycle brings outstanding competitive advantages; (2) Revenue growth in the fabric segment is driven by rising domestic demand and the capacity expansion potential of the SY Vina factory; (3) Diversification of export markets and (4) TC Tower project can contribute positively to TCM's profit if it is eligible for sale in the future. Based on the DCF method, we initially valued TCM shares at VND 37,800, corresponding to an upside of 27%.