Foreign investors extend their investment into HPG for 4 consecutive sessions

Foreign investors extended their streak of pouring money into HPG for 4 consecutive sessions with net buying value in the session on October 9 reaching 237 billion VND, the highest in the past 7 months.

Shares of Hoa Phat Group Joint Stock Company (stock code: HPG) closed on October 9 at VND27,500, up 2% compared to the reference price and continuing a series of increases for 3 consecutive sessions. The market capitalization of the leading steel company also increased to VND175,897 billion, ranking 6th on the Ho Chi Minh City Stock Exchange.

Not only increasing in market price, HPG liquidity also improved significantly in yesterday's session when it ranked second on the Ho Chi Minh City Stock Exchange in terms of matched value with VND1,137 billion, an increase of more than VND100 billion compared to the previous session. This value came from more than 41.6 million shares successfully transferred.

HPG's first increase of the week was strongly supported by foreign cash flow. Specifically, foreign investors spent more than VND 302 billion to buy more than 11 million shares while only selling about 2.4 million shares, equivalent to VND 65.3 billion. This is the strongest net buying session of foreign investors for HPG since February 2024. Not only that, foreign investors also extended their net buying streak into HPG for the fourth consecutive session with increasing value.

Foreign capital flows returned to HPG when the company just announced its third quarter business results. Specifically, Hoa Phat achieved revenue of more than VND34,000 billion in the third quarter and VND105,000 billion after 9 months, up 19% and 23% respectively compared to the same period last year. Compared to the full-year target of VND140,000 billion, the company has completed 75% of the plan.

The management board said that the steel industry in general still faces many difficulties both domestically and internationally, and selling prices tend to decrease.

The company produced 6.4 million tons of crude steel in the first 9 months of the year, up 34% year-on-year. Sales of all types of steel reached 6.1 million tons, up 32% year-on-year. In addition, steel pipes increased by 3% year-on-year to 503,000 tons and Hoa Phat corrugated iron reached 344,000 tons, exceeding the whole year of 2023 (329,000 tons).

In a report on the steel industry published half a month ago, a group of experts from MB Securities Joint Stock Company (MBS) said that Hoa Phat is the leading enterprise in the steel industry and benefits from the recovery of domestic prices.

According to the expert group's estimates, the company's net profit in the 2024-2025 period could increase by 74% and 51% year-on-year, respectively, thanks to increased output and improved gross profit margin. In 2026, with the contribution of 3 million tons of HRC from the Dung Quat 2 project, net profit could reach VND23,576 billion (up 31% year-on-year).

MBS recommends investors buy HPG shares with a target price of VND33,500. This projection is 21.8% higher than the current price range.

Regarding investment plans in the coming time, Chairman of the Board of Directors Tran Dinh Long said that Hoa Phat has to do difficult work. Currently, the company is researching the production of silicon steel to serve the production of electric motors used in the manufacture of transformers and electric vehicles.

Regarding the Dung Quat 2 project, the company said that the project has completed 80% of the progress of phase I and 50% of phase II. According to the current progress, phase I is expected to have the first hot test product of the rolling furnace by the end of 2024. This is a project with a scale of 5.6 million tons of hot rolled coil steel/year . In addition, the company also plans to invest in a new steel complex in Phu Yen - called the Dung Quat 3 project with an investment scale of 5 billion USD.