Earnings Report /

Phu Nhuan Jewelry: Market leadership to underpin record-high retail sales

  • Monthly retail sales continuously post record highs following lockdown

  • Soaring gold prices could lend some support to average selling prices, bolstering profit margins expansion

  • Private placement to further cement PNJ’s strong industry position; Accumulate with an updated TP of VND118,500

Thang Hoang
Thang Hoang

Analyst - Real Estate

Rong Viet
15 March 2022
Published byRong Viet

Expanding market share, tailored marketing strategy, coupled with resilient purchasing power of targeted customer segmentation, help PNJ to keep posting record-high monthly retail sales post lockdown. Soaring gold prices meanwhile lend support to average selling prices, bolstering profit margins expansion.

The company's private placement is likely to be completed in Q2 22, providing necessary capital of up to VND1.4tn for the company to intensively expand its store network and production capacity in 2022-23.

On the back of its solidified market leadership position and potential margin expansion, we revise our forecasts upward, resulting in respective projected net sales and NPAT of VND23,044bn (+18% yoy) and VND1,394 (+35% yoy), equivalent to 2022f diluted EPS of VND5,745. Consequently, our updated TP comes in at VND118,500, implying a 2022F P/E of 20.6x. We reiterate our Accumulate recommendation on PNJ.