IL TOPIC 5: COMPREHENSIVE REPORT INTRODUCTION ABOUT VINAMILK Vietnam Dairy Products Joint Stock Company Vinamilk is not only one of the leading enterprises in Vietnam but also a symbol
Trang 1NGAN HANG NHA NUOC VIET NAM BO GIAO DUC VA DAO TAO
TRUONG DAI HOC NGAN HANG THANH PHO HO CHI MINH
BO MON KINH TE
BAI TIEU LUAN MON: TAI CHINH DOANH NGHIEP
CORPORATE FINANCE
IMPLEMENTATION TEAM
Trang 2STUDENT ID
(01/01/2018- | including liquidity, | Tyyong Trin Ky Phuong | CÓ QUY 100%
structure, and market
value Length: 2-4 pages
the Gordon Growth
Model Note: Justify the - 050609210729 100%
inputs of the valuation Dam Hué Man
model and provide your
analysis of the results
Length: 1-2 pages
the Rate of | capital structure over time
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_perato = /camentan he companys) yy Ta Ming in| 80610221882 | 10%
porfilio ->
choose the
weighted of 2
assets
the company (maximum
length: 1/2 page A4)
Trang 3
IL TOPIC 5: COMPREHENSIVE REPORT (INTRODUCTION ABOUT VINAMILK)
Vietnam Dairy Products Joint Stock Company (Vinamilk) is not only one of the leading enterprises in Vietnam but also a symbol of sustainable development and credibility in the international market With over four decades of establishment and development, Vinamilk has significantly contributed to improving the quality of life and providing high-quality dairy products to consumers
Vinamilk began its journey from the pioneering efforts of its founders in the 1970s, amidst the post-war economic context of Vietnam With dedication and foresight, they embarked on a challenging yet meaningful path Vinamilk's business activities extend beyond the production and distribution of high-quality dairy products to various sectors such as beverages, confectionery, functional foods, and even real estate Vinamilk's mission goes beyond providing nutrition to consumers; it also aims to be a reliable and sustainable development partner for the community
Vinamilk, or Vietnam Dairy Products Joint Stock Company, has been listed on the stock market since 2006 This listing process involved publicly offering shares to provide opportunities for investors to purchase the company's shares
Before listing, Vinamilk had to comply with regulations set by the State Securities Commission (SSC) and be ready to disclose financial information and operate the company according to international standards to ensure transparency and accountability
in its business activities
Following its listing, Vinamilk's shares became one of the most closely monitored stocks
on the Vietnamese stock market Investors can buy and sell Vinamilk shares through stock exchanges such as the Ho Chi Minh City Stock Exchange (HOSE) and the Hanoi Stock Exchange (HNX), with transactions regulated and monitored by securities regulatory authorities
Listing on the stock market has provided Vinamilk with not only new capital but also an opportunity to become a transparent, professional, and sustainable development enterprise in the financial market
With professional management and a sustainable development strategy, Vinamilk has become one of the leading stocks on the Vietnamese stock market Its financial stability, continuous revenue and profit growth, coupled with stringent management and
continuous innovation, have attracted attention and trust from investors both domestically and internationally Vinamilk continues to uphold its mission, striving not only to be a successful enterprise but also a reliable partner committed to the community and the environment
Trang 4II TOPIC 1:
1 Liquidity Ratios
Short-term | 20.559.756.7 | 24.712.565.3 |29.665.725.805| 36.109.910.64 | 31.560.382.1
Short-term | 10.639.592.0| 14.442.851.8 | 14.212.646.285| 17.068.416.99 | 15.308.423.0
Ratios
Inventorv | Š-525-845.95 |4.983.044.40 | 4.905.068.613 |6.773.071.634 | 5.537.563.39
Ratios
@ 2018 2019 ™ 2020 2021 m 2022
2,0872.1169 969
Current Ratios
1,7421,719 Quick Ratios
Liquidity
Trang 5@ Current Ratio is an index used to evaluate the solvency and financial risk of a business Vinamilk has always maintained Current Ratios at a certain range and 1s always >1 Current ratio > 1, shows a high current ratio, meaning the company has enough ability to pay short-term debt and vice versa This index serves as a tool to notify businesses that they need to use corrective measures to mobilize capital before the business goes to the brink of bankruptcy
If you only rely on Current Ratio, it is not enough basis to draw conclusions about the liquidity of a business That's why Quick Ratio appears and complements Current Ratio
In the years from 2018 to 2022, Quick Ratio grew steadily, this is a signal that the solvency of the business is in a period of steady increase
2 Profitability
eBrr _ | !2-103.063.68 |12.904.534.53] 13.662.354.552|13.011.034.577| 10.661.573.768
Total | 52.561.949.97 |56.318.122.76| 59.636.286.255 |60.919.164.846 |59.959.247.197
EAT _ | 10.205.629.71 |10.554.331.88| 11 235.732.234|10.632.535.972| 8.577.575.319
oe 36.016.713.92 |41,032.991.19]46.566.177.029|50.882.442.055|50.907.533.837
ssets
oe 25,072.213.55 |28.001.312.24]31.689, 188.717 |34.748.618.239|34.333.316.302
Equity
Trang 6@ The indicators ROL, ROS, ROA, ROE help us evaluate the financial performance of a business During this period, all indexes have a common decreasing trend over the years This shows that business profits in these years have decreased But it is not because of a decrease in revenue, but because of the increase in interest costs of the business during these years, possibly for the purpose of expanding operations and at the same time, Vinamilk has a policy to support people during the epidemic period
@ As for the EPS index, this is an index that shows the profit level of each stock During this period, EPS in general tended to decrease, but in 2019 alone it increased by 3.45% compared to 2018 This may be because 2020 was the first year Vietnam had a Covid epidemic, lasting for many consecutive years This is a big problem for the whole society so it has greatly affected the economy in general and Vinamilk in particular Therefore, from 2020 onwards to 2022, this index gradually decreases
3 Capital Structure (Co cau von)
Trang 7
Structure Don vi: dong
LIABILI | 11.094.739.71 | 14.968.618.18 | 14.785.358.44| 17.482.289.18|15.666.145.88
Short- | 10.639.592.36 | 14.442.851.83 | 14.212.646.28| 17.068.416.99|15.308.423.08
Long- |455.147.352.7| 525.766.348.3 |572.712.158.3| 413.872 193.3|357.722.799.6 term debt 90 10 32 16 11 Equity |20-271-369.29 | 29.731.255.20] 33.647.122.22| 35.850.114.24|32.816.518.35
TOTAL |37.366.109.00 |44.699.873.38 |48.432.480.67| 53.332.403.43 |48.482.664.23
Debt
Equity
Debt to
ratio
Debt ratio indicates what percentage of a business's total assets are invested by debt Vinamilk only maintains this number at a stable level and < 1 Realizing that the majority of corporate assets invested by equity can be determined by Equity Rate - the percentage of the company’s total assets Businesses are invested in equity Shows that the company is still solvent using its available assets
Debt to Equity ratio
05
Vinamilk's D/E index always
remains stable at an average level of 0.466 This index measures the level of debt used 1n business activities instead
of relying on equity, thereby reflecting the level of dependence
on debt of the business If this index
is too low, businesses do not know how to take advantage of loan capital to expand business activities
2019
2019
2020 2021
2020 2021
2022
2022
Trang 8On the contrary, if D/E > 1, the business will face the risk of bankruptcy due to increased risk Therefore, if a consultant needs to review and analyze technical calculations, if the business's D/E 1s greater than | but knows how to use capital effectively, this will be an attractive investment opportunity On the contrary, for the business itself, if D/E > 1, it is necessary to assess risks and implement risk mitigation solutions
4, Asset Management
§2.561.949.97 |56.318.122.76 |59.636.286.25 |60.919.164.84| 59.959 247.1 0.592 2.744 5.547 6.146 97.418 36.016.713.92 |41.032.991.19 |46.566.177.02 |50.882.442.05| 50.907.533.8 2.338 6.607 9 832 5.924 37.220
27.950.543.50 |29.745.906.11 |31.967.662.83 |34.640.863.35| 36.059.015.6 1.501 2.117 7.839 3.839 90.711 4.773.452.467 |5.2541.445.18114.944.056.50815.839.070.123|6.155.317.51
994 636 767 817 5.067
4.615.575.376 |4.571.301.314 |4.845.203.950 |5.504.640.957| 5.961.215.80
629 530 555 471 6.823
KẾ sư xát tuoi FÊlweeeoynuneie' ĐÕ acawanne Tho @ Total asset turnover, this index
shows the number of tumovers a business makes in a year to generate revenue It shows whether the business is using assets to generate
123 123
00
2018
2019 2020 2021
Trang 92018-2022, this index gradually decreases over the years due to an increase in total assets of Vinamilk, not due to a decrease in revenue
Inventory tumover can effectively demonstrate a business's ability to sell existing goods and reinvest in new goods because it measures a business's inventory turnover This index at Vinamilk is quite stable, because if this mdex increases too high, the business may face many risks
Recetvable revenue is used to measure a business's performance in managing and collecting debt from customers In this index, Vinamilk also maintains a stable level, not only helping businesses stabilize cash flow, minimizing the risk of not being able
to recover debt, but also helping not to affect customer relationships if this number is too high Because it shows that the business is applying a strict debt collection policy
5 Market Value
Unit:
VND
market
value of a
1.596.34
108.391
Market | 829.030./118.240.695.98 | 130.063.232.20| 141.907.974.71|141.907.974.71
>» Market value is a number that
reflects the future growth and profit potential of a business At VNM, this index increases steadily every year,
enterprise has always grown over the
Trang 10years This is also a good signal for investors when making decisions to invest or trade shares of this enterprise
Il TOPIC 2: STOCK VALUATION
Estimate the intrinsic value of the stock using the Gordon Growth Model
Justify the inputs of the valuation model and provide your analysis of the results
consolidated reports of Vinamilk Company from 2018 to 2022
Mean
é, UIYIUEIIU3 V.4)2%13J04)
172 177
0522407563 0.439414562 0|-
3645 373643 3908.212693
Intrinsic Value: The calculated intrinsic value of the stock 1s 3.905% This value represents an estimate of the stock's true value If the stock's current market price is below this intrinsic value, it suggests the stock may be cheaper than it needs to be This can be considered an opportunity for investors to consider buying shares because they think it has the potential to bring higher profits in the future
Trang 11Projected growth rate: The expected dividend growth rate according to investors’ predictions is 47.95% This growth rate shows that investors believe the company will perform very well in the future and be able to pay higher dividends to shareholders Just as investors are expecting the company to grow and make more money, this will benefit shareholders
IV TOPIC 3: COST OF CAPITAL
Estimate the company's cost of capital
2 Calculate the market return rate
VN-Index
Risk-free interest rate
Cost of
Interest expense 5136741885) 1088256411 1438186411 88799090663 1.660396411 Short-term debt 1,06005E412 5.35146EH2 13165E412 938035E12 48671312 Long-term debt 157996411 1.229936+11 16/)E111 75636000000 66028725000
business 1s riskier or they have high expectations about the profits they hope to earn To address these risks and expectations, they set higher targets for their
investment returns, known as the cost of capital
Trang 12In 2019, VNM found that business risks were reduced or they were more satisfied with earning less money from their investments As a result, they decided to lower their investment return target, which was reflected in their cost of capital
In 2020, VNM decided to maintain its investment profit target in 2020 This means that they believe that the risks and expected profits in their business operations
remain relatively stable They are satisfied with the amount of money they make
on their investments and do not feel the need to adjust their capital expenditures 2021: In 2021, VNM feels more comfortable with making less money from
investments or they believe the risk in their business has decreased further So they decided to further lower their investment return target This capital cost adjustment shows they are willing to accept lower returns on investment
2022: However, in 2022, VNM changed its approach and wanted to make more money back from its investment They believe the risks in their business have
increased or they desire higher profits To adjust their investment goals to these
changes, they raised their investment return target back to the higher level they set
in 2018
Estimate WACC
The Weighted Average Cost of Capital (WACC) serves as a metric for a company's overall financing cost It incorporates the costs associated with all capital sources, encompassing both debt and equity These costs are then weighted in accordance with their relative proportions within the company's capital structure Ultimately, WACC provides a singular measure that reflects the average cost the company
incurs to finance its operations
2022 Year 2018 2019 2020 2021
Total debt
Total equity
1275846571690.00 26,271,369,291,927
5474454243084.00) 29,731,255,204,364
7483318827191.00|
33,647,122,229,822
3457930118118.00|
35,850,114,249,384
4933158564103.00
'Weight of debt
Weight of equity 4.03%
95.37% 15.55%|
84.45% 18.20% | 81.80%
20.87%|
79.13% 13.07%
'WACC 2.247% 2.105% 2.079% 1.898% 2.264%