FPT Corporation (HOSE: FPT) | Q1 2026 Update, BUY – 1Y Upside +50.5%

Near-Term Headwinds, Valuation Correction Created Attractive Entry Point

In Q1 2026, FPT reported revenue of VND 12,480bn (+8.7% YoY) and PBT of VND 2,804bn (+16.3% YoY), marking the slowest quarterly revenue growth in the past five years amid weaker global outsourcing demand and AI-driven industry disruption. The Technology segment remained the key growth driver, with revenue rising 11.0% YoY, supported by strong growth in Japan (+18.8% YoY) and the EU (+44.5% YoY). Consolidated PBT growth was mainly driven by stronger associate contributions, with affiliated company income rising 26.9% YoY to VND 667bn, driven by FOX and FRT. FPT completed 19.6% and 23.6% of our FY2026 revenue and PBT forecasts, respectively.

Following Q1 results and changing industry dynamics, we revise down our FY2026 forecasts to revenue of VND 56,323bn (+11.3% YoY) and PBT of VND 11,816bn (+16.9% YoY). In 2027, we forecast revenue and PBT to reach VND 62,203bn (+10.4% YoY) and VND 13,312bn (+12.7% YoY), respectively.

We also lower our target valuation multiples, revising our target P/E in the standalone P/E method from 18x to 17x, while reducing the Technology and Telecom segment P/E multiples in our SOTP valuation from 20x and 18x to 17x respectively, in line with sector average valuations. As a result, our FY2026 Target Price is revised down to VND 107,300/share from VND 123,100/share previously.

We maintain our BUY recommendation on FPT. At the current market price of VND 70,700/share, our target price of VND 106,400/share implies a potential upside of 50.5%, offering an attractive long-term risk-reward profile.