Khang Dien House (HOSE: KDH) | Q1 2026 Update, BUY - 1Y Upside +82.3%

Goodwill Gain Offsets Slower Profit Recognition From Gladia In Q1 2026

KDH reported Q1 2026 revenue of VND 281bn (-60.7% YoY; -84.5% QoQ), mainly due to limited handovers at Gladia by the Waters project. As of Q1 2026, only 30% of the 226 units were handed over. However, NPAT-MI surged 130.7% YoY to VND 281bn, supported primarily by VND 279bn in goodwill income from the acquisition of An Lap Real Estate JSC (Cat Lai project).

Despite weaker top-line performance, gross margin improved significantly to 65.0% from 43.2% in Q1 2025, driven by higher-margin from low-rise units at Gladia. Selling expenses remained elevated as KDH continued offering sales incentives to maintain presales momentum amid challenging real estate market conditions and high interest rates.

On the balance sheet side, inventories rose sharply by 25.2% YTD to VND 29,126bn following the consolidation of the Cat Lai project, while long-term borrowings increased 60.5% YTD to finance land-use right payments, resulting in KDH’s debt-to-equity ratio rising to 85.2%.

KDH expects to accelerate sales and handovers at the Gladia project throughout 2026, alongside potential gains from partial stakes sales in other projects like Binh Trung Dong Expansion and 11A (The Solina). As of Q1 2026, Gladia presales reached ~60% and small low-rise products achieving nearly 90% take-up. Management also continues advancing development and sales of several key projects, including Solina, Le Minh Xuan Industrial Park, and Tan Tao A.

Q1 2026 Financial Performance

o   Net Revenue: VND 281bn (-60.7% YoY, -84.5% QoQ)

o   Profit Before Tax: VND 356bn (+127.2% YoY, -63.8% QoQ)

o   NPAT-MI: VND 281bn (+130.7% YoY, -43.3% QoQ)