LPG AND LNG LEAD LONG-TERM REVENUE GROWTH

After conducting the initial valuation of GAS shares using the FCFF discounted cash flow method, SHS issued a Positive recommendation for GAS, with a 12-month target price of VND 72,500 per share, representing an 11.8% upside compared to the market price of VND 64,900 on August 28, 2025.

• Revenue improved and sustained growth momentum in 2024 and 2025 first half; however, profitability remains under pressure from volatile input costs. Net profit in 2025 is expected to be supported by provision reversals.
• Vietnam’s macroeconomic growth will serve as a key driver of overall national energy demand. GAS’s international LPG business is on an upward trajectory, with a market share of approximately 65% in Cambodia. Looking ahead, Cambodia’s LPG consumption is forecast to grow at a CAGR of 7% during 2021–2040, largely driven by increased use of tuk-tuks. Notably, imports from Vietnam currently dominate Cambodia’s LPG supply routes.
• GAS plays a pivotal role in the development and supply of LNG. While Vietnam is transitioning toward renewable energy, LNG remains a critical transitional fuel in the medium term. GAS enjoys a strong competitive edge with existing infrastructure, notably Thi Vai LNG Terminal has already in operation.
• Between 2012 and 2023, GAS consistently maintained a relatively high and stable cash dividend policy. In 2024, due to profit pressures, dividend payout ratio declined to 21%. In near-term, GAS is expected to maintain limited dividend payouts in order to balance operating cash flow.

RISKS

• Profit margins haven’t show any signs of improvement due to input cost pressures and regulated selling prices: (1) High volatility in global LNG spot prices; (2) Intensified competition in the LPG market, with rivals adopting price cutting strategies, directly pressuring GAS’s margins.
• Dependence on EVN and power plants: (1) Potential payment risks or changes in electricity pricing mechanisms; (2) Margins heavily tied to gas-to-power sales contracts with EVN and power plants.
• Delays in domestic oil & gas projects: (1) Prolonged legal and regulatory procedures; (2) Political risks and sovereignty disputes; (3) Infrastructure development delays.