Masan Group has identified its growth drivers for the rest of 2024, largely arising from its organic growth, consumer-focused strategy, and the improved economic environment.

In a recent meeting with investors, Masan’s representative said, “WinCommerce continues to generate profits in August 2024. Previously, the retail chain made profits in June and July. Like-for-like growth of the minimart chain accelerated to over 10 percent on-year.”

WinCommerce is Vietnam’s largest modern grocery retail platform, operating nearly 3,700 stores, including WinMart supermarkets, WinMart+ convenience stores, and WiN minimarts.

This marks an important milestone in WinCommerce’s retail strategy, as innovation and operation optimization have generated healthy organic profits.

Masan has increased the ownership in WinCommerce to strengthen its control and to drive long-term growth in its core business.

The corporation has announced its acquisition of a 7.1-percent stake in WinCommerce from SK Group for $200 million.

Masan shall receive the right to acquire SK Group’s remaining shares in WinCommerce (WCM) in the future at cost.

At the same time, SK Group has achieved a successful return on investment by selling a portion of its WCM stake, while continuing its long-term investment in MSN through the extension of the put option.

“We expect the third-quarter profits will be higher than that of the second quarter thanks to the improved profitability of WinCommerce, the growth of Masan Consumer, as well as positive signals from other business segments,” the representative of Masan said of the profit outlook for the third quarter.

In 2024, most securities firms anticipate an economic recovery, with the retail and consumer goods sectors standing out as bright spots, driven by increased cash flow into manufacturing.

According to Viet Dragon Securities Corporation, the retail sector will gain traction on the back of the manufacturing recovery. Low-interest rates improve consumer confidence, while inflation remains under control.

According to the General Statistics Office, GDP grew positively in the second quarter of 2024, with the growth rate being estimated at 6.93 percent over the same period last year.

HSBC’s economists believe that Vietnam is likely to be the fastest-growing economy in ASEAN this year, a spot it lost to Malaysia and the Philippines in 2022 and 2023, respectively.

Given the better-than-expected expansion in the second quarter, they predict that the country’s yearly GDP growth will be 6.5 percent, up from the previous forecast of six percent.

Vietnam experienced significant growth in international tourist arrivals, fueled by favorable visa policies and 2024 tourism promotion programs implemented by localities nationwide.

According to the GSO, nearly 10 million international visitors arrived in Vietnam in the first seven months of this year, marking a 51-percent increase compared to the same period last year and a 1.9-percent rise from pre-pandemic levels in 2019.

SSI Research forecasts that Vietnam will be upgraded in the assessment scheduled for September 2025.

With the upgrade to emerging market status, preliminary estimates suggest that capital inflows from ETF funds could reach up to US$1.7 billion, not including capital from active funds. FTSE Russell estimates that total assets from active funds are five times greater than those from ETF funds.

According to SSI Research, VNM, VHM, VIC, HPG, VCB, SSI, MSN, VND, DGC, VRE, and VCI are stocks that could attract significant capital flows as Vietnam is upgraded to emerging market status.

These are all leading blue-chip stocks, but they still have room for foreign investment. MSN and VNM are two Consumer Staples stocks among the list.

Besides SSI, J.P. Morgan also shifts their preference to Consumer Staples, which they believe should reap the double benefits of lower input costs and resilient earnings growth.

A J.P. Morgan report indicates that the government’s initiatives, along with seasonal factors, are driving economic activity in the second half of 2024.

This momentum is expected to positively impact stock market performance during the fourth quarter of 2024 and the first quarter of 2025.

“The strong growth vs. regional peers reinforces our Overweight (OW) on Vietnam within ASEAN, with key OW sectors: Banks (VCB, ACB, TCB), IT (FPT), and Consumer Staples (MSN),” the report stated.

The international financial institution believes near-term tailwinds are favoring consumer Staples stocks, citing three key factors: (1) potential inflows from an emerging market upgrade, (2) a weaker USD reducing input costs, and (3) resilient earnings growth. As a result, the sector has been upgraded to OW, with Masan Group (MSN) identified as one of their top picks.

Using the sum-of-the-parts (SOTP) valuation method, J.P. Morgan has priced MSN at VND94,640 per share, with projected price-to-earnings (P/E) and enterprise value to EBITDA (EV/EBITDA) ratios of 39x and 12x, respectively, for 2025.

The SOTP method involves valuing each subsidiary or business division of a company individually, then combining these values to determine the overall company valuation.

“We are confident that we will complete the profit plan for 2024 with strong growth in the short and medium terms to create superior values for the company’s shareholders,” said Dr. Nguyen Dang Quang, chairman of Masan Group.

Positive indicators, including GDP growth, manufacturing, and international tourist arrivals to Vietnam, send a positive signal about the recovery of the economy in general and the consumption market in particular.

This trend contributes to promoting the business results of retail and consumer goods enterprises.

As an industry leader with continuous positive results from its core retail consumer business, Masan promises to not only complete but also exceed its 2024 profit plan.