HPG — Express note — 3Q25

Hoa Phat Group (HPG VN)

Right On Cue

Details

3Q25 net revenue (+7% YoY/ +1% QoQ) reached VND36.4 trillion, driven by a 71% YoY surge in HRC sales volume, partly offset by an 8% YoY drop in ASP. Meanwhile, construction steel sales fell 3% YoY due to the rainy season’s impact on construction activities.

Blended gross margin expanded to 17%, up from 14% in 3Q24, indicating that the cost-price spread remained well supported, despite a 4-5% QoQ increase in iron ore prices. Consequently, 3Q25 NPAT (+33% YoY/ -6% QoQ) reached an impressive VND4.0 trillion.

9M25 NPAT fulfilled 80% of our 2025E forecasts, coming in at VND11.6 trillion (+26% YoY).

3Q25 ASP (+12% QoQ) rebounded more strongly than our expectation (VND13.5 mn/ton vs VND13.2 mn/ton). This result reinforces our confidence in a strong ASP recovery trend toward yearend, supported by 1) accelerating public investment disbursement, which typically accelerates in 4Q to meet the annual targets; and 2) housing reconstruction after the recent severe storms.

The agriculture segment reported solid 9M25 results, with net revenue of VND6.3 trillion (+28% YoY) and NPAT of VND1.3 trillion (+88% YoY), driven by 1) a c.10-15% YoY increase in live hog prices and 2) superior reproductive efficiency (23 market hogs/sow/year vs the industry average of 19). HPG did not provide an update on the potential agri IPO.

Our view

Solid results were in line with our expectations as discussed in our Oct 2025 report, which details our optimistic view for 2025-2026E.

We reiterate our BUY call with target price of VND38,400, implying +43% 12-month TSR. The stock price surged about 50% from its April-25 bottom to the peak in September before the more recent pullback. We recommend that investors accumulate HPG shares during this correction phase given the positive outlook for next year.

The railway steel mill has recently elicited strong market attention. Although the sentiment shift is gratifying, we are not ready to conclude that the project will meaningfully boost HPG’s profitability. This is because 1) producing railway steel requires input materials that meet stringent quality standards, which is likely to pressure HPG’s production costs; and 2) government contracts typically carry thin margins.

Please access the link for our complete report: HPG – Express note – 3Q25_Review