MWG — Express Note — 2M25 results

Key Highlights

Unexpected +13.5% YoY growth for ICT&CE revenues in 2M25. Despite concerns about consumer demand, TGDD and DMX reported aggregate sales growth of 13.5% YoY in 2M25. TGDD’s sales were especially strong at VND5.6tn (+23% YoY), while DMX’s reached VND11.3tn (+9% YoY). This was a positive result considering the closure of over 200 outlets YoY.

Accelerating BHX’s expansion. BHX recorded sales of VND7tn in 2M25 (+16% YoY), with average sales per store reaching VND1.9tn in 2M25 (+6% YoY). The company opened 94 new grocery outlets in 2M25, 50% of which are concentrated in the Central region. Guidance is for an additional 200-400 outlets in 2025, so the stores added in 2M25 represent 24% of the high end of that range. BHX’s total footprint is now 1,864 outlets.

Sales from other retail chains (i.e., An Khang Pharmacy and AvaKids) declined by -14% YoY to VND540bn in 2M25. The outlet numbers at An Khang Pharmacy (326 pharmacies as of Feb) and AvaKids (62 outlets) were flattish YTD.

EraBlue – Update on the Indonesia business. EraBlue operates a home appliances/white goods retail network with 95 outlets as of Feb (+9% YTD / +79% YoY). On Mar 10th, MWG announced an MOU to invest an additional US$50mn (equivalent to VND1.3tn) in this partnership with Erajaya (ERAA IJ, BUY, covered by Chandra Pasaribu), a substantial increase vs. MWG’s investment of VND242bn as of end-2024.

MWG’s annual general meeting is scheduled for April 26th.

Our View

We reiterate our BUY recommendation on MWG with a target price of VND 76,100 per share, implying 12-month total shareholder return of 27.6%.

The 2M25 results were significantly better than our expectations in the grocery retail and especially the ICT & CE retail segment.

CE/ICT recovery is happening earlier than we anticipated. As discussed in our latest company report published on January 8, we had expected MWG’s electronics retail business to recover, but only starting from 2H25 -– in line with our house call on the property industry’s recovery, which we think will also boost consumer sentiment.

In addition, our forecast for BHX appears overly conservative as we have modelled in an additional 150 grocery outlets in 2025, with BHX to achieve 1,900 stores by year-end. However, BHX has already opened 94 outlets in 2M25, putting the actual figure at 1,864 — very close to our forecast, with another ten months remaining in the year. The pace of expansion is on track to exceed our assumption, implying upside to our fair value estimate.

Please see the link for more details: MWG — Express note — 2M25 results