Stock market buoyed by upbeat earnings forecasts

Stock market buoyed by upbeat earnings forecasts

Preliminary earnings reports from major firms are painting a brighter picture for the stock market, with strong performances in the banking, logistics, construction, and consumer sectors fuelling investor confidence.

Although financial statements for the second quarter and the first half of 2025 have yet to be officially released, several companies have already revealed positive preliminary figures, providing a bright spot amid ongoing market challenges.

Upbeat corporate earnings provide support for the stock market's continued growth

At its AGM on June 24, Gemadept Corporation, a major in local port and logistics ecosystems, disclosed that in H1, the company is expected to count approximately $110.4 million in revenue and $44 million in pretax profit, fulfilling 57 per cent and 61 per cent of its full-year projections.

At its H1 business review conference on June 19, state lender VietinBank announced an encouraging performance during the first half of the year.

The bank bagged estimated credit growth of 10 per cent and deposit growth of over 9 per cent compared to the end of 2024.

Pre-provision profit continued to grow steadily. In Q1, VietinBank reported consolidated pretax profit of approximately $273 million, up nearly 10 per cent on-year.

State conglomerate Vietnam National Textile and Garment Group (Vinatex) reported a consolidated revenue for H1 of $361million, up 8 per cent on-year.

Estimated consolidated profit approximated $22.2 million, achieving 61 per cent of the full-year plan and showing a 97 per cent jump on-year.

In the consumer sector, Masan Group (MSN) revealed a strong Q2, with estimated profit reaching $60 million, up nearly 60 per cent on-year.

As global news continues to sway market sentiment, the gradual release of upbeat corporate earnings is expected to provide support for the stock market’s continued growth.

Analysts from MBS Securities forecast that overall market earnings in Q2 of 2025 could grow by 14 per cent on-year.

The banking sector is expected to perform particularly well, with projected profit growth of 15 per cent, supported by credit expansion and improved net interest margin.

On the policy front, a decree that allows foreign ownership in certain banks, such as VPBank, MB, and HDBank who have been tasked to take on weak banks, to be raised to 49 per cent, creating room for capital increases.

Meanwhile, a draft law aimed at institutionalising a National Assembly resolution, which piloted the resolution of non-performing loans, is expected to enhance debt recovery efficiency.

This will particularly benefit banks with high provisioning funds, such as VietinBank and VPBank, and smaller lenders like OCB, MSB, and VIB.

In the construction sector, Vinaconex is forecast to see a 98 per cent on-year surge in Q2 profit, thanks to the handover of components of the North-South Expressway and part of the Cho Mo Trade Centre in Hanoi’s Hai Ba Trung district.

Deo Ca Traffic Infrastructure Investment JSC, a major contractor in central Vietnam, is also expected to post strong Q2 profit growth.

This is driven by a 20 per cent on-year increase in revenue from build-operate-transfer operations, boosted by a more than 15 per cent rise in vehicle traffic.

Meanwhile, its construction segment remains steady with projects belonging to the North-South Expressway network, such as the Quang Ngai-Hoai Nhon section.

The maritime and port sector has also benefited from a robust trade environment in Q2, partly due to a 90-day tariff deferral decision made by the US administration.

For instance, container throughput at ports in Ba Ria-Vung Tau province (now Ho Chi Minh City) is expected to rise significantly, as this area handles 50-55 per cent of Vietnam’s exports to the US, supporting port operators like Gemadept.

Globally, sea freight rates have rebounded strongly, up about 70 per cent from the April lows, fuelling revenue growth for shipping firms such as Hai An Transport and Stevedoring JSC (HAH).

In H1, HAH estimates revenue at approximately $100.5 million, up more than 50 per cent on-year, with profit approximating $22 million, tripling compared to the same period last year.

In the retail sector, FPT Digital Retail JSC, part of tech giant FPT Corporation, is projected to report Q2 net profit growth of up to 292 per cent, driven by the expansion of its Long Chau pharmacy chain, with average monthly sales per store holding steady at roughly $52,000.

The consumer staples segment is also seeing strong momentum, with BAF Vietnam Agriculture JSC and Dabaco Group JSC expected to post significant profit increases in Q2, thanks to persistently high pork prices.

Net profit for BAF Vietnam’s parent company is forecast to surge 471 per cent, while that of Dabaco Vietnam is projected to see a 201 per cent on-year increase.

VIR