[BUY/TP: 110,000] Status quo resilience


Retain BUY rating and TP at VND110,000


We reiterate our BUY rating for Vinamilk and target price at VND110,000 as Vinamilk‘s 3Q21 business result is in-line with our forecast. Vinamilk’s share has been flatted over the past 6 months as the negative growth of bottom-line in 9M21. However, we still believe that Vinamilk’s earnings will resume growth trajectory since 4Q21, in light of: 1) the reopening of economic activities; 2) the bearing fruits from Mocchau Milk (Improving margins) and new JVs; and 3) potential improving profit margins as upcoming two new cow farms (Quang Ngai and Lao-Jargo) within the next 6 months, leading to higher raw milk autonomy rate to 25% in 2022 from 22% in 2020.


We believe that Vinamilk will step into a new growth stage since 2022, signaling opportunities for higher future growth. Vinamilk’s products are expected to continue being chosen by more consumers, relying on: 1) the reopening of schools, ‘HORECA’, and factories (their major clients); and 2) expanding product portfolio via new JVs in order to meet a variety of clients. Del Monte-Vinamilk JVs is expected to generate of VND200bn in the first year of operation, and Vibev JVs would record VND2tn in 5-years of operation.



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