{"id":16531,"date":"2019-01-25T16:10:31","date_gmt":"2019-01-25T09:10:31","guid":{"rendered":"https:\/\/yuanta.com.vn\/?post_type=phan-tich&#038;p=16531"},"modified":"2019-01-25T16:10:31","modified_gmt":"2019-01-25T09:10:31","slug":"pnj-watch-this-space","status":"publish","type":"phan-tich","link":"https:\/\/yuanta-uat.ysvn.com.vn\/en\/analysis\/pnj-watch-this-space","title":{"rendered":"PNJ &#8211; Watch this space"},"content":{"rendered":"<p><strong>Target price:\u00a0N\/A<\/strong><\/p>\n<p><strong>Upside:\u00a0<\/strong>N\/A<\/p>\n<p><strong>Event catalyst:<\/strong><\/p>\n<ul>\n<li>FY18 revenues (+33% YoY) and NPAT (+32% YoY).<\/li>\n<li>FY19E guidance for mid-20s percentage growth YoY.<\/li>\n<li>Wristwatch segment: a potential future growth driver.<\/li>\n<\/ul>\n<p><strong>Strong FY18 results. <\/strong>PNJ reported 2018A sales growth of 33% YoY and NPAT growth of 32% YoY. The key gold jewelry segment saw same-store sales growth of 20% YoY and 55 new stores in 2018. PNJ said that its gross margin also improved from 17.4% in 2017A to 19.1% in 2018A due to a higher contribution from the gold jewelry segment and an increase in premium product launches during the year.<\/p>\n<p><strong>FY19 guidance.<\/strong> PNJ guided for 24% YoY revenue growth and 23% YoY NPAT growth in 2019E. Management expects gold jewelry segment same-store sales growth of 18% YoY and plans to open another 40 new stores in 2019E. PNJ intends to extend its focus more toward Tier-2 and Tier-3 cities and to promote its watch segment more aggressively as it prepares for maturity in its current major business.<\/p>\n<p><strong>Watches: the next growth catalyst?<\/strong> Management discussed the watch segment as a potential future growth driver. PNJ has been a watch retailer for many years, but largely as a sideline. Given the segment\u2019s small scale, PNJ purchases products from distributors rather than from brands, which results in thin profit margins.<\/p>\n<p><strong>Our view: <\/strong>We don\u2019t cover PNJ and have no investment view on the stock. However, Vietnam\u2019s gold jewelry market remains highly fragmented, with traditional independent stores accounting for 80% of market share. As such, the industry appears ripe for consolidation. Also, PNJ\u2019s strategy to scale up its wristwatch retailing network should be a key area of investor interest. The stock trades at 16x 2018A PE, but given the stock\u2019s full FOL, foreign investors are likely to be asked to pay a 10-20% premium to purchase a PNJ block.<\/p>\n<p><strong>\u00a0<\/strong><\/p>\n<p><strong>Please access the link for our complete report:\u00a0<a href=\"http:\/\/yuanta-uat.ysvn.com.vn\/wp-content\/uploads\/2019\/01\/PNJ_Company-Visit-Note.pdf\">PNJ_Company Visit Note<\/a><\/strong><\/p>\n<p><em>Analyst: Quang Vo,\u00a0<\/em><a href=\"mailto:quang.vo@yuanta.com.vn\"><em>quang.vo@yuanta.com.vn<\/em><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Target price:\u00a0N\/A Upside:\u00a0N\/A Event catalyst: FY18 revenues (+33% YoY) and NPAT (+32% YoY). FY19E guidance for mid-20s percentage growth YoY. Wristwatch segment: a potential future growth driver. Strong FY18 results. PNJ reported 2018A sales growth of 33% YoY and NPAT growth of 32% YoY. The key gold jewelry segment saw same-store sales growth of 20%&#8230;<\/p>\n","protected":false},"author":10,"featured_media":0,"template":"","class_list":["post-16531","phan-tich","type-phan-tich","status-publish","hentry","analysis-category-non-rated-company-visit-note"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.3 (Yoast SEO v23.4) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>PNJ - Watch this space | Yuanta Vietnam<\/title>\n<meta name=\"description\" content=\"Target price:\u00a0N\/A Upside:\u00a0N\/A Event catalyst: FY18 revenues (+33% YoY) and NPAT (+32% YoY). FY19E guidance for mid-20s percentage growth YoY. 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