First Read: Techcombank "2026 AIC: Near-term funding pressure, long-term..."

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First Read: Techcombank "2026 AIC: Near-term funding pressure, long-term..."

Forecast returns

Forecast price appreciation 38.0%

Forecast dividend yield 2.2%

Forecast stock return 40.2%

Market return assumption 9.3%

Forecast excess return 30.9%

Company Description

Techcombank (TCB) was established in 1993 and listed on the Ho Chi Minh Stock Exchange

(HOSE) in 2018. The bank focuses on customer-centricity (8.4m retail customers), with a

dominant market share in the affluent segment, and aims to optimise shareholder returns via

its ecosystem approach. TCB's major shareholder is Masan Group (15%). In 2020, TCB had

US$19.1bn in assets, US$14.1bn in loans, and US$12bn in deposits. Its network includes 309

branches and 947 ATMs in 45 provinces.

Valuation Method and Risk Statement

We derive our price target from a two-stage valuation model (DDM and Gordon growth

model).The key downside risk to our estimates could arise from competition, particularly as

the sector remains fragmented, and regulation risk that may hinder the bank's ability to grow

fee income quickly. Moreover, if the bank cannot gear up its balance sheet effectively, ROE

could disappoint due to ongoing balance sheet deleveraging. NPLs could surprise negatively if

the bank compromises its asset quality as it tries to lever up its balance sheet. Although the

bank has sufficient capital, its ability to expand credit could be limited by the regulator. The

probability outlook could also be at risk if the macro environment is weaker than we expect.

We also believe there is risk from top management changes and note its CEO position's

relatively high turnover. Like other banks, TCB faces the risk of cyber-attacks. This could lead

to higher spending on system upgrades and downside risk to our EPS projections.