After a series of statements by Chairman Tran Dinh Long at Hoa Phat Shareholders’ Meeting, how do securities experts evaluate HPG stock?
HPG stock is often called a “national stock” by investors on the Vietnamese stock market when the number of shareholders holding up to 161,000 investors. Because of that, the information about the business as well as the statement of President Tran Dinh Long at this year’s General Meeting of Shareholders immediately caused a storm.
Answering questions from shareholders at the meeting, Chairman Hoa Phat frankly explained the profit target of VND 25,000 – 30,000 billion in 2022, a significant decrease compared to 2021: “We are just a cell in the economy, everyone is waiting for the second quarter, third quarter and fourth quarter business results, I think this year’s business plan will be difficult. Everyone will see how dire business results because the steel industry is not favorable. Of course, in any circumstances, Hoa Phat will try to do the best.
In any difficulty, Hoa Phat must be the best company in the steel industry, but shareholders are requested to be very sympathetic. In this common economy, I can’t be different“.
The news immediately affected the stock price right in the afternoon session on the same day of the May 24 meeting, HPG stock was sold strongly by investors. The selling pressure skyrocketed, putting pressure on the stock, causing HPG’s share price to drop 5% to 34,900 dong/share, while the market was positive with the VN-Index up 14.57 points (1.2%). . In the VN30 basket, HPG was also the stock with the biggest drop.
“What do you think when the president of the company makes a statement that goes against the thinking of the majority of analysts?“, Editor Hoang Nam asked a question to Mr. Pham Luu Hung, Chief Economist of SSI Securities in the talkshow. Money secret No. 22 broadcast on VTV Digital with the theme The summer-autumn crop has a bumper crop?. At the beginning of the year, SSI’s analysis reports on Hoa Phat also gave an optimistic assessment of this stock, contrary to the current situation.
“Actually, I don’t think it goes against the opinion of analysts. I remember that when I joined the program, I still spoke in a way that I didn’t like Hoa Phat stock very much. Although saying that now will cause a storm, but the growth prospect is not good so I also do not like this stock if I have to choose 1 stock to invest in. I’m not in the business now, so it’s hard to say. But when business leaders say that, they can also look back. Within the next 2 years, Hoa Phat’s problem will be related to the new factory project.
With this situation, there are also certain concerns about the prospects of enterprises in the coming time. It is not unreasonable for investors to have to sell strongly in recent times”, commented Mr. Pham Luu Hung – Chief economist of SSI securities company.
In terms of technical analysis, BTV Hoang Nam said that this is another opportunity to accumulate “gifts of God” because although HPG is not favorable in the short term, in the long term, Chairman Tran Dinh Long promises business This industry does not stop, but continues to go up.
“Is a good and continuously discounted stock like Hoa Phat attractive enough to invest?”, Editor-in-Chief Hoang Nam asked Ms. Nguyen Thi Thu Dung, Sales Director – Headquarter of SSI.
According to Ms. Dung, investors will always have two perspectives: long-term and short-term. With a business like Hoa Phat, it will be attractive to long-term investors. In the short term, steel enterprises in the period of high selling prices, the more their inventories are at low prices, the better their gross profit margin will be.
“However, in the current period, there is not much inventory at low prices of steel industry enterprises. Enterprises also have to face the problem of increased production costs from factors such as increased coke, increased electricity prices.
Although China is locking down, (they) continue to produce steel, which is unexpected as the market is reduced in supply (while maintaining supply). I (Vietnamese steel enterprises) export, but have difficulties“, Ms. Dung analyzed.
This expert said, for a business in the short term when they continue to expand production and business, building a factory costs a lot, usually these stocks in the short term will not price increase immediately. Ms. Dung cited typical enterprises such as Dong Hai Ben Tre in the investment stage of the factory, the stock fluctuations were very narrow, but after being put into operation, the shares increased sharply. Or as in the case of Gemadept when Gemalink was under construction, the stock price has not grown strongly. When the factory came into operation, it created an explosion in revenue – profit, then the stock price increased sharply, creating confidence for investors.
“In the short term, Hoa Phat stock is being discounted at a good price, but because of such factors, I can allocate a low weighting or choose stocks with better growth potential.“, Ms. Thu Dung concluded.
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