Khang Dien House (HOSE: KDH) | 2Q26 Update, BUY - Upside +81.9%

Earnings Remained Resilient, Valuation Discount

KDH 2Q26 Performance

KDH reported 2Q26 revenue of VND161bn (-84.7% YoY, -42.9% QoQ), with GPM at 50.2%, up from 38.7% in 2Q25 due to a more favorable handover mix. NPAT-MI surged 277.3% YoY and 166.5% QoQ to VND750bn, mainly driven by a VND896bn gain from the divestment of Binh Trung Moi. For 1H26, revenue declined 74.9% YoY to VND442bn, achieving only 9.1% of our previous forecast and 12.4% of management’s guidance. NPAT-MI reached VND1,031bn (+221.3% YoY), achieving 73.8% of our forecast and 68.7% of guidance.

Gladia high-rise supports presales; low-rise absorption remains slower

KDH launched Gladia Heights in 2Q26 with a low upfront-payment scheme (10% to move in) in partnership with banks, supporting strong initial demand. Management indicated the project has secured ~2,400 bookings, with ~450 units targeted for sale in 3Q26. We expect this to strengthen presales and improve earnings visibility into 1H27, when handovers are expected to begin.

Meanwhile, Gladia by the Waters continues to face slower absorption due to its higher ticket size. We lower our FY26 handover assumption to 105 units from 135, shifting 30 units to FY27. KDH is working with JV partner on additional sales incentives, but we remain cautious about near-term absorption.

Earnings Forecast

We revise FY26E/FY27E revenue down to VND4,240bn (-9.3% YoY) and VND6,337bn (+57.4% YoY), reflecting a more conservative recognition schedule in 2026. FY26E NPAT-MI rises 26% to VND1,766bn, mainly due to the VND896bn Binh Trung Moi divestment gain; excluding this, core NPAT-MI falls to VND820bn (from VND1,169bn). FY27E/28E NPAT-MI are also cut 13%/18% to VND 1,080bn/ 2,662bn.

Target Price and Rating

We apply a 20% discount to Tan Tao NAV, raise WACC to 15.1% and lower P/B to 1.6x (from 2.0x), reducing our TP to VND33,100/share (from VND43,300), implying 81.9% upside from 11 Aug 2026 closing price of VND 18,200/share. Therefore, we maintain BUY rating on KDH.