{"id":57447,"date":"2020-04-24T15:26:51","date_gmt":"2020-04-24T08:26:51","guid":{"rendered":"https:\/\/yuanta.com.vn\/?post_type=phan-tich&#038;p=57447"},"modified":"2020-06-26T15:30:49","modified_gmt":"2020-06-26T08:30:49","slug":"stb_npa-recovery-progress-is-key-to-watch","status":"publish","type":"phan-tich","link":"https:\/\/yuanta-uat.ysvn.com.vn\/en\/analysis\/stb_npa-recovery-progress-is-key-to-watch","title":{"rendered":"STB_NPA recovery progress is key to watch"},"content":{"rendered":"<p><span style=\"font-size: 18pt\"><strong>BUY<\/strong><\/span><\/p>\n<p>TP upside (downside) +41%<br \/>\nClose 23 Apr 2020<br \/>\nPrice\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0VND 9,150<br \/>\n12M Target\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 VND 12,950<br \/>\nPrevious Target \u00a0\u00a0 VND 14,049<br \/>\nChange\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0-8%<\/p>\n<p><strong><span style=\"font-size: 14pt\">Company Update<\/span><\/strong><\/p>\n<p><strong>Reducing our credit growth forecast. <\/strong>We lower our 2020E loan growth forecast for STB by -1.5ppt to 12.5% YoY.<\/p>\n<p><strong>NIM forecasts cut <\/strong>by 22bps to 2.32% for 2020E. This is because of <a href=\"http:\/\/yuanta-uat.ysvn.com.vn\/wp-content\/uploads\/2020\/02\/Banks-told-to-cut-or-delay-loan-repayment_Express-Note.pdf\">the SBV\u2019s policy<\/a> to decrease loan yields to support individuals and firms hit by the outbreak.<\/p>\n<p><strong>We slash our fee income forecasts <\/strong>by 9% for 2020E given the weak near-term outlook for transaction banking.<\/p>\n<p><strong>Rising provision costs and NPLs<\/strong>. STB is rescheduling payments and retaining pre-outbreak asset quality categorization of related loans. This is in line with the SBV\u2019s policy, which is likely to continue through 3Q20 at least. Thus, STB\u2019s NPL ratio might not rise significantly in 2020E, but it may jump in 2021E. However, we believe that STB will prudently provide adequate provisions beforehand.<\/p>\n<p><strong>We slash our PATMI forecasts by<\/strong> -18% for 2020E and -17% for 2021E. Our reduced PATMI forecasts are 29% below Consensus for 2020E and 24% for 2021E and represent growth of -2% YoY in 2020E but +34% YoY in 2021E.<\/p>\n<p><strong>Cheap valuation \u2013 we maintain our BUY rating. <\/strong>The stock is trading at 0.6x 2020E P\/BV vs. peers\u2019 median of 0.9x. Even with the reduced price of VND12,950, we still see 41% upside. We continue to view STB as a turnaround play in the long haul. The pandemic is obviously a concern but assuming it can be controlled in 2Q20, the real estate market should start to warm up again. Otherwise, the progress of restructuring may be impeded, which would obviously constitute a downside risk. Thus, we continue to suggest a barbell strategy with <a href=\"http:\/\/yuanta-uat.ysvn.com.vn\/wp-content\/uploads\/2020\/03\/VCB_Company-Update_03.27.2020.pdf\">VCB<\/a> (our top pick) as a core holding and STB as a potential rerating story.<\/p>\n<p>Please access here for the complete report: <a href=\"http:\/\/yuanta-uat.ysvn.com.vn\/wp-content\/uploads\/2020\/04\/STB_Company-Update_04.24.2020.pdf\">STB_Company Update_04.24.2020<\/a><\/p>\n<p><strong>Analyst: Tanh Tran<\/strong>,<em> tanh.tran@yuanta.com.vn<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>BUY TP upside (downside) +41% Close 23 Apr 2020 Price\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0VND 9,150 12M Target\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 VND 12,950 Previous Target \u00a0\u00a0 VND 14,049 Change\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0-8% Company Update Reducing our credit growth forecast. We lower&#8230;<\/p>\n","protected":false},"author":10,"featured_media":0,"template":"","class_list":["post-57447","phan-tich","type-phan-tich","status-publish","hentry"],"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>STB_NPA recovery progress is key to watch | Yuanta Vietnam<\/title>\n<meta name=\"description\" content=\"BUY TP upside (downside) +41% Close 23 Apr 2020 Price\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0VND 9,150 12M Target\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 VND 12,950 Previous Target \u00a0\u00a0 VND 14,049\" \/>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"STB_NPA recovery progress is key to 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