THRIVING AGAINST HEADWINDS

We initiate coverage of FPT Corporation (FPT VN) with Positive recommendation and a 12-month target price of VND 118,500 per share, implying an upside of 12.8%, using the Sum-of-the-Parts (SOTP) method. Key investment thesis include:

• IT services for the overseas market remain the main growth driver, although they may be indirectly affected by the recent U.S. reciprocal tax policy. However, FPT’s operations are expected to be largely insulated from direct impact, as the current policy primarily targets goods. Furthermore, part of the services provided to foreign clients are delivered through local subsidiaries such as Intellinet and Intertec.
• FPT is expected to continue leveraging its market-leading position domestically, particularly under the new policy direction that designates science and technology (S&T) as a key strategic sector, with increasing governmental support for the industry.
• The company maintains a healthy financial position with a strong cash balance, low debt, and a consistent dividend payment history over the years.
• From a conservative standpoint, FPT’s projected revenue in 2025 is VND 72,748 billion (+15.8% YoY), net profit is expected to reach VND 10,639 billion (+12.8% YoY), and EPS is estimated at VND 5,241 per share. The stock price has declined to an attractive valuation range, following recent market-driven corrections

RISKS

Operational risks: (1) Risk from intensifying competition; (2) Risk that the global IT services market may not grow as expected.