VCS shares generally have positive developments in the first few months of 2024, increasing from a price of VND55,000/share at the end of 2023 to a 52-week high of VND73,600/share (during the trading session) and VND72,100/share (closing price) on March 29, 2024. However, from March 29, 2024 until now, the stock price trended down and is currently at VND61,900/share (closing price on April 23, 2024).

In fiscal year 2023, VCS recorded VND4,353.9 billion net revenue, equivalent to a decrease of 23.08% yoy and completing 92.4% of the annual plan. PBT reached VND 999.4 billion, equivalent to a decrease of 27.4% yoy and completing 94.3% of the annual plan. The Annual General Meeting of Shareholders on April 12, 2024 approved the business plan for 2024 with a consolidated net revenue target of VND4,602.6 billion and a profit before tax target of VND 1,033.9 billion, equivalent to a yoy increase of 5.71% and 3.45% respectively. Currently, VCS has not published Q1 business results, but at the Annual General Meeting of Shareholders, the Chairman of the Board of Directors said that in Q1/2024, the company’s operations “show growth” and “this is a positive sign.”

We use the discounted residual operating income valuation method and updated projections regarding VCS to value VCS shares and give a target price of VND59,500/share. This valuation is equivalent to a P/E forward of 10.02x. Based on the target price and the current price of the stock (VND61,900/share), we give a NEUTRAL recommendation for VCS stock.