Thien Long Group (HOSE: TLG) | Q1 2026 Update, BUY - FW2026 Upside +19.8%

Core Operations Improved, Rising Raw Material Costs Remain A Key Watchpoint

In Q1 2026, TLG delivered solid results, with revenue reaching VND 1,000bn (+25.9% YoY), supported by stronger sales volume. Domestic revenue rose to VND 661bn (+29.3% YoY), driven by recovering post-Tet demand and customer front-loading ahead of ASP increases, while export revenue reached VND 339bn (+19.7% YoY), thanks to the expansion into Southeast Asia and selected international markets. 

GPM improved significantly to 48.2% (+5.4% YoY), mainly due to changes in the accounting treatment of promotional expenses. Besides, the ratio of operating expenses, including COGS and SG&A, declined to 85.3% of revenue (-2.6% YoY) in Q1 2026, driving NPAT growth to VND 116bn (+47.0% YoY). Following these results, TLG completed 21.7% and 24.0% of our FY2026 revenue and NPAT forecasts, respectively despite Q1 low season.

We maintain our FY2026 forecast, with revenue of VND 4,606bn (+10.4% YoY) and NPAT of VND 484bn (+7.1% YoY). In addition, we believe the strategic stake sale to KOKUYO could serve as meaningful upside for TLG, as the implied acquisition price of VND 71,000/share, adjusted for the 10% stock dividend issued on 11 Dec 2025 and the 35% cash dividend on 13 May 2026, remains significantly above the current market price. Meanwhile, TLG continues to maintain a stable annual cash dividend of VND 3,500/share, implying a dividend yield of 6.8% based on the closing price of VND 51,400/share as of 07 May 2026.

Based on the above, we maintain our BUY recommendation on TLG, with a FW2026 target price of VND 61,600/share, implying a potential upside of 19.8% from the closing price of VND 51,400/share as of May 07, 2026.