Mobile World (HOSE: MWG) | Initiation Report, BUY – 1Y Upside +15.8%

Company Information

Mobile World Co., Ltd. (MWG) was established in March 2004, with its main business activities including mobile phones and digital devices retail, and e-commerce-related services. In 2007, MWG received investment from Mekong Capital and transitioned into a joint-stock company, paving the way for its continuous growth and expansion. Mobile World was listed on the HOSE in 2014 with a market capitalization of VND 5,112 bn.

Financial Performance

During the 2019-2024 period, MWG revenue recorded a compound annual growth rate (CAGR) of 7.1% per annum (p.a), a much slower growth rate compared to the previous period, mainly due to the impact of Covid-19 pandemic and the weakened consumer demand.

Key Investment Rationales

o       TGDD and DMX could grow at a reasonable 1.5% in revenue, yet BHX would accelerate and achieve an impressive top line growth of 18.8% over the next 3 years

o       Net profit would improve well in the coming years from the improvement of BHX and MWG’s strong bargaining power to secure favorable gross margins in each business line.

o       The store counts of BHX would increase strongly ahead as the platform is now ready to expand after several years of fine tuning.

Valuation and Recommendation

We use DCF, P/E multiples, and SOTP to evaluate MWG share value and inititate a BUY recommendation with a 12M Target price of VND 69,000/share, representing an upside potential of 15.8% compared to the closing price of VND 59,600 as of March 5, 2025. Our valuation model derives a 3Y Target Price of VND 98,200 /share, implying an upside of 64.7%.