First Read Mobile World Investment Jun 26: Strong top line momentum in Q2

研报英文原文证据摘录

First Read Mobile World Investment Jun 26: Strong top line momentum in Q2

Forecast returns

Forecast price appreciation 77.4%

Forecast dividend yield 1.8%

Forecast stock return 79.2%

Market return assumption 9.4%

Forecast excess return 69.8%

Company Description

Established in 2004, Mobile World Investment (Mobile World) is the No.1 retailer in Vietnam

by revenue and net profit, with nearly 5,600 stores in all 63 municipalities and provinces as of

2023 and is expanding in Indonesia. It operates in diversified retail chains including: Gioi Di

Dong in mobile phones; Dien May Xanh, EraBlue (Indonesia) in consumer electronics; Bach

Hoa Xanh in grocery retail; and An Khang in the pharmaceutical and ecommerce platforms of

these chains.

Valuation Method and Risk Statement

We value Mobile World using DCF methodology (WACC: 8.7%).

Company-specific risks include: Inadequate strategic planning resulting in an inability to meet

long-term strategic objectives; credit risks of customers and suppliers; insufficient financing to

expand retail operations; risks from operational errors, lower-than-expected same-store-sales

growth and store expansion; inventory obsolescence and ineffective inventory life-cycle

management; social media risk that may lead to reputational damage; succession risk where

key roles in the company are not satisfactorily filled within an acceptable time frame;

execution risks such as a failed omni-channel model and a grocery retailing model; failure of IT

systems; increasing competition; increase in operating expenses such as rent, wages, utilities

and transport; foreign exchange risks; breakdown in relationships with key suppliers such as

Apple or Samsung; unavailability of ideal new store locations.