MWG’s express note — May results

Key Highlights

MWG returned to double-digit growth in May with total revenue reaching VND12.6 tn, up by +12% YoY (compared to just +8% YoY in April due to a high base last year).

Total sales growth in May was driven by strong consumer demand for personal electronics devices, with smartphones, tablets and laptops posted revenue growth ranging from 20–50% YoY in May. We believe the e-invoice mandate for household businesses has partly helped to boost demand for these devices. Other consumer electronics categories also posted healthy single- to double-digit growth. As a result, CE&ICT retail sales reached VND8.4 tn (+13% YoY) in May.

Grocery retail revenue growth slowed in May, partly due to the rainy season and a moderation in new store openings. BHX posted revenue of VND3.9 tn in May, +12.7% YoY (lower than April’s 22.4% YoY and March’s 28.3% YoY). In this month, BHX opened 51 new grocery outlets – the slowest expansion pace YTD, bringing the total number of stores to 2,180 (+410 new groceries YTD, surpassing the company’s full-year guidance of 200–400 stores).

Other revenue (including An Khang Pharmacy chain and AvaKids – mom and baby retail chain) declined by -10% YoY but grew by +32% MoM, reaching VND1.4 tn in May. The YoY drop was due to lower number of stores. MWG currently operates 326 An Khang pharmacies (-155 stores YoY) and 62 AvaKids outlets (-2 stores YoY). We believed the MoM growth was supported by the Vietnam authorities’ stricter control on counterfeit goods (especially for medicines, supplements, cosmetics, dairy products, or even baby products) from May 15 to June 15, 2025. As such, transparent retailers (i.e., who can provide clear traceability of product origin) are well-benefited from this initiative.

Regarding the business in Indonesia – EraBlue, MWG reported an additional of 7 new outlets in May and remains on track to have 150 stores by the end of the year. Further information on EraBlue’s revenue and profitability will be disclosed in the 2Q25 financial statement of ERAA IJ (BUY), known as a co-owner of EraBlue.

As of 5M25, MWG has already achieved 41% of its FY2025 consolidated revenue guidance and 42% of our full-year forecast.

Our View

Market transparency policies will greatly benefit reputable retailers that are able to follow the regulations. Specifically, stricter control over counterfeit goods and the requirement for household businesses to issue e-invoices are helping to ‘cleanse’ the market. We believe this presents an opportunity for modern trade to gain market share from traditional trade.

Therefore, we reiterate our BUY recommendation on MWG. Our target price of VND 76,100 per share, implying 12-month TSR of 18.5%.

Please access the link for more details: MWG — Express note — May results