Which factors to accelerate Masan Group share price?
Vietnam’s stock market is expected to recover in the second half of the year thanks to the business results of listed companies and accelerated public investment.
Before that, many institutions had offered higher target valuations for Masan share price due to its unique offline-to-online consumer and retail platform. For example, SSI Securities Corporation valued Masan share price at VND129,200 ($5.41) per share at the beginning of this year, and VSCS suggests Masan share price at VND157,000 ($6.58) by the end of the third quarter.
Despite challenging environment, Masan’s core profit grows by 40%
Masan Group’s profits up 123% in 1H2022
Accelerating digital transformation, Masan aims for $4.33b revenues in 2022
Growth potential from the market is a motivation of Masan share price high forecast
According to the VNDirect, the bright outlook for the Vietnamese stock market in the year's second half is based on the continued economic growth momentum, with GDP growth expected to reach 7.1 percent.
Statistics showed that Vietnam's stock market had tumbled sharply to hit bottoms in 2007-2008, 2011-2012, 2018-2019, and this year. The market started a downtrend after the FED raised interest rates for the first time in June. In 1H2022, the market benchmark index and liquidity plunged sharply, with the VN-Index posting a dip of 20.5 percent. Despite the sharpest decline in the year's first half, experts are still optimistic about the market's outlook in the second half, especially retail stocks, such as Masan share price growth.
Consumption continued to overcome: Retail sales grew by 0.6% MoM and 50.2% YoY in Aug-2022. As a result, retail sales amounted to 15.1% YoY and USD144.1bn, respectively, which is already higher than pre-Covid numbers of 9.5% YoY and USD139.8bn, respectively. This is considered one of the positive signals to help Masan share price grow and streamline the forecasts of securities companies.
In addition, the Vietnamese government is making more efforts to accelerate public investment disbursement. Besides, many foreign investors have looked at emerging markets such as Vietnam as an area of potential investment. As a result, in August 2022, FDI disbursement reached USD1.2bn, up by 11.1% YoY, reinforcing Vietnam's positive outlook despite the global slowdown. For eight months of 2022, the total distribution was USD12.8bn (+ 10.5% YoY), the highest 8M FDI disbursement value in the past five years.
Many blue-chip stocks are at attractive price ranges for investment, especially retail industry stocks. Masan share price with a high forecast and a lot of growth potential thanks to its outstanding growth potential.
Growth potential from solid synergies of the largest consumer-retail ecosystem
Masan is adjusting its fiscal 2022 targets to more accurately reflect market conditions and optimize financial results for 2022 while promoting the consumer-technology strategy to support Masan share price growth.
Thanks to solid synergies between businesses in Masan's consumer-retail ecosystem, The Group has a huge-scale customer base with 98 percent of Vietnamese households using at least one Masan product, nine million loyal customers at WinCommerce (WCM), nearly five million affluent customers from Techcombank, and young, digital-savvy customers with an urban lifestyle from Phuc Long. In addition, the group can reach millions of consumers from strategic O2O partners, including Lazada.
The attractiveness of the consumer sector and favorable macroeconomic conditions will boost consumption demand in Vietnam. In addition, Masan is an industry commander in the consumer retail sector, integrating technology to capture modern consumer needs. From here, investors have more confidence in Masan Group share price growth in the last months of the year.
Masan achieved outstanding results in many aspects, such as the number of new WinMart/WinMart+ points of sale, improved profit margins, and accelerated online channel sales. On the part of Masan Consumer Holdings (MCH), the growth momentum comes from its strategy of product premiumization. As a result, MCH's spice and convenience food industry achieved outstanding business results, increasing the likelihood of Masan share price appreciation in the long term.
In the meantime, WCM plans to open 800 new stores in the second half of 2022 to expand its retail network, including more than 100 stores following the franchise mode to restore its position as the largest convenience store operator in Vietnam. WCM will also continue to optimize product types, promotions, and operating costs to ensure profitability.
Meanwhile, MCH focuses on research and development (R&D) in critical commodities such as spices, convenience foods, and processed meats to generate outstanding growth and continue to promote momentum in the field of beverages, coffee, and beer. Phuc Long Heritage (PLH) accelerates the opening of new flagship stores for revenue and profit growth. At the same time, it launched new drinks to make the Phuc Long kiosk model more successful. Masan Meat Life (MML) will expand its distribution network beyond WCM systems and serve a variety of WCM customer segments. Masan High-Tech Materials (MHT) will optimize costs, cash flow, and integration with Nyobolt.
Masan Group is continuing to accelerate the 'Point of Life' ecosystem, a model that meets the essential needs of consumers, including necessities (food and beverages), financial services (payment, credit cards, and investment), and others (healthcare, education, and entertainment) in a multi-utility concept store.
On September 9, the Vietnamese retail conglomerate Masan Group announced the launch of WINLife, the one-stop shop ecosystem that provides consumers with a convenient and seamless offline-to-online experience. Masan's next innovation to improve customer experience through its consumer tech platform is the WINLife ecosystem. The WINLife concept store integrates Masan's WinMart+ convenience store format with its other businesses, including coffee chain Phuc Long Coffee & Tea, financial services firm Techcombank, pharmacy Dr.Win and telecommunication services provider Reddi. The model aims to possess 60-80 percent of consumers' wallet share under an integrated offline-to-online ecosystem and contribute to Masan share price growth.
Masan Group is growing the kiosk format of its Phuc Long coffee and tea across its new WINLife store, which is expected to reach 100 locations in Vietnam by the end of 2022.
"During the past three years, besides restructuring WinMart/WinMart+ to become a profitable retail platform, Masan has taken steps to pioneer multi-utility retail models to meet the ever-evolving consumer demand. We are happy to introduce the WINLife ecosystem, a destination of powerful brands with great quality manufactured by Vietnamese to satisfy Vietnamese consumers, with the slogan "WIN is all you need” - said a Masan Group representative.
This move has contributed to Masan share price growth while creating much potential for the company's sustainable growth in the future.