Overview of Q1’s profit picture: An industry that surpassed Real estate to become the “star” of the strongest growth

This is considered a disappointing quarter for Steel, Chemical and Securities companies, the total of these three groups dragged down the profit growth of the whole market down 13.5 percentage points in Q1/2023.

Q1/23 net profit growth continued to disappoint. According to VNDirect’s estimate, the total net profit in Q1/2023 of companies listed on the 3 exchanges decreased by 18.1% over the same period, a lower decrease than in Q4/2022, down 31.9%.

Group of real estate, tourism become bright spots

This is considered a disappointing quarter for Steel, Chemical and Securities companies, the total of these three groups dragged down the profit growth of the whole market down 13.5 percentage points in Q1/2023.

Specifically, the net profit of listed steel companies decreased by 93.3% over the same period. However, this figure has improved significantly compared to the previous 2 quarters of net loss thanks to (1) the recovery of steel selling price and (2) reversal of the provision for devaluation of inventories.

The Chemicals sector extended its negative trend with net profit dropping by 71.9% y/y due to a sharp drop in phosphorus and fertilizer prices. Securities companies also recorded a sharp drop in net profit of 96.6% y/y due to a 63.1% drop in market liquidity in Q1.

On the contrary, during the difficult period, real estate developers “shined” with 28.3% growth in net profit over the same period, mainly thanks to the contribution of VHM (+162.5%) thanks to record bulk wholesale transactions. However, excluding VHM, net profit of real estate developers decreased by 40.4% YoY in Q1/23.

However, the “champion” in profit growth this quarter was the pharmaceutical industry with an increase of 34.9% over the same period. Thereby, contributing 0.2% to the general market.

Notably, the tourism and entertainment industry has gradually returned to the right trajectory, recording a positive net profit of more than 200 billion dong for the first time since the Covid-19 epidemic. This result was largely contributed by HVN’s loss of VND103.6 billion in Q1/23 (compared to a loss of VND2,613 billion in Q1/22).

Small and mid-cap groups were hit hard

In terms of capitalization group, VNDirect assessed that the business results of small and medium-cap enterprises were more heavily affected in Q1/2023. Total net profit of VN30 enterprises in Q1/23 decreased by 11.1% over the same period, more positive than that of large-cap group which decreased by 12.4%. Profit of large-cap group dropped more than VN30 mainly due to DPM (- 87.7%), DCM (-84.9%) and VGI (-68.8%).

Profits in Q1/23 of mid-cap and small-cap group fell sharply by 39.8% y/y and 38.5% y/y, respectively, lower than Q4/22 due to stable exchange rate and lower interest rates.

For VN-30 group, Q1 profit recorded a decrease of 11.1%. In which, 14 enterprises in VN30 had positive net profit growth “named” VRE (+171%), VHM (+162%) and PLX (+155%).

In contrast, in Q1/23, MWG’s net profit dropped sharply by 98.5% y/y, reflecting the negative impact of falling consumer demand amid high interest rates and the fact that some financial firms used under investigation.

Although HPG’s Q1/23 net profit dropped by 95.2% y/y, HPG still gave a good signal when net profit was positive after 2 previous loss quarters thanks to (1) steel price recovery and (2) refund. provision for devaluation of inventory. Notably, NVL recorded a loss of 337 billion dong in Q1/23 (Q1/22: +1,079 billion dong) due to market factors that weakened real estate transfer revenue (-70.6%).

Ha Anh/Market life