TRƯỜNG ĐẠI HỌC NGÂN HÀNG TP.

HỒ CHÍ MINH

BÀI THI KẾT THÚC HỌC PHẦN

Môn thi: ĐẦU TƯ TÀI CHÍNH .....................................

Họ và tên sinh viên: NGUYỄN THỊ QUỲNH HƯƠNG

MSSV: 050606180146 .................................. Lớp học phần: FIN309_202_6_L01_TA

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BÀI LÀM
AN PHAT BIOPLASTIC JOINT STOCK COMPANY

1. Corporate information
- English name: An Phat Bioplastics joint stock company
- Abbreviated name: An Phat Bioplastics., JSC
- Trade name: AAA
- Enterprise registration certificate: 0800373586 issued by the Department of Planning and
Investment of Hai Duong Province for the 1st time on March 9, 2007, amended for the 30th
time on 5th November 2020
- Charter Capital: VND 2.217.599.740.000
- Total common shares: 296,759,974 shares

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 2. Business lines and market presence
(1) Manufacturing mono-layer packaging and industrial packaging. With 8 factories,
packaging output reachs 120,000 tons per year, including mono-layer packaging (traditional and
bio-degradable) and industrial packaging (jumbo bags, sling bags, PP bags).
(2) Manufacturing and trading materials for plastic industry.Manufacture CaCo3, plastic
additives and masterbatches, PE and PP compounds, trading resins and other chemicals for plastic
industry
(3) Providing logistics services. Providing comprehensive logistics solutions including
international forwarding, customs services, logistics and warehousing
(4) Leasing factories and subleasing industrial land. Developing industrial infrastructure and
provide amenity services in industrial parks.
3. Financial Performed
3.1.Business results

Fig.1: Business results summary

Net sales In 2020 reached VND 7,429 billion, down 20% compared to 2019’s. Revenue
decreased over the same period last year mainly due to resin price fall in the first half of 2020
leading to packaging and resin trading sales decline and absence of sales from the industrial real
estate segment.
Gross profit In 2020, consolidated gross profit reached VND 777 billion, down 25%
compared to 2019’s because of absence of contribution from industrial real estate. Gross profit
margin decreased slightly from 11% in 2019 to 10% in 2020.
Selling expenses Selling expenses increased from VND 214 billion in 2019 to VND 256
billion in 2020, equivalent to an increase of 20% over the same period last year. This growth was
attributed to the consolidation of industrial packaging segment and higher freight charges in late
2020.
Profit after tax Profit after tax reached VND 283 billion in 2020, down 42%. This fall was
explained by the fact that the industrial real estate segment was affected by the epidemic and had
delayed recognition of profits. Net profit margin decreased from 5% in 2019 to 4% in 2020 for the
same reasons

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 3.2.Balance sheet
AAA’s total asset in 2020 reached VND 8,569 billion, up 7%, of which current assets
decreased by 10% and non-current assets increased by 35% In terms of assets structure, current
assets accounted for 53% of total assets and non-current assets accounted for 47% compared to
62% and 38% respectively in 2019.

Fig.2: Balance sheet summary

Current assets
In 2020, short-term assets reached VND 4,496 billion, down 9.6% compared to 2019’s,
due to a decrease in inventory and short-term receivables. Cash and cash equivalents increased
from VND 646 billion in 2019 to VND 964 billion as of December 31, 2020. Short-term assets
accounted for 53% of total assets, compared with 62% in 2019.
Capital in cash: Due to operation efficiency, the Company maintained reserves of cash
capital and managed this cash flow appropriately. Risk management policy was established to
ensure term deposits were sufficient to meet with the Company’s capital needs. Total cash and
cash equivalents and short-term financial investment at the end of 2020 reached VND 1,722
billion, up 27% over the same period last year.
Short-term receivables: In 2020, short-term receivables reached VND 1,669 billion,
accounting for 20% of total assets and decreasing by 20% compared to December 31, 2019’s. In
which, account receivables decreased from VND 727 billion at the end of 2019 to VND 593 billion
in 2020. The Company well managed receivables, however, due to some customers being affected
by the epidemic, the Company recorded VND 12 billion of provision for short-term receivables.
Inventories: Consolidated inventory in 2020 reached VND 947 billion, down 23%, mainly
because the Company adjusted its inventory policy. The Company did not generate outdated
inventory in 2020.
Non-current assets
Non-current assets at the end of 2020 reached VND 4,073 billion, up 38% compared to
VND 3,016 billion as of December 31, 2019. Non-current assets increased sharply mainly because
in 2020, the Company acquired An Vinh Plastics Packaging JSC which manufactured industrial
bags. Long-term assets in progress increased from VND 294 billion in 2019 to VND 361 billion

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 in 2020 due to the construction of factories in An Phat High-Tech Industrial Park which will be
handed over to customers in the first half of 2021.
3.3.Capital structure

Fig.3: Capital structure summary

The Company’s capital structure was optimized to reduce capital costs and enhance
efficiency. Total liabilitie in 2020 decreased by 4% to VND 4,545 billion. In which, short-term
liabilities increased from VND 3,237 billion at the end of 2019 to VND 3,773 billion at the end of
2020 and long-term liabilities decreased from VND 1,496 billion in 2019 to VND 773 billion in
2020. Total Liabilities/Total Assets ratio at the end of 2020 reached 0.53 times, improving compared
to the level of 0.59 at the end of 2019, reflecting its better financial health.
3.4.Financial ratios
Table 1: Financial ratios
Indicators Unit 2019 2020
Liquidity ratio
Current ratio times 1.54 1.18
Quick ratio times 1.16 0.93
Profitability
Net margin % 5.3 3.81
ROE % 17.75 7.0
ROA % 6.33 3.3
EBIT margin % 6.38 4.19
Financial leverage ratio
Total liabilities/ Total assets times 0.59 0.53
Total liabilities/ Owners’ equity times 1.45 1.13
Efficiency
Asset turnover times 1.19 0.9
Receivables turnover times 13.06 11.26
Accounts payable turnover times 13.39 11.60
Inventory turnover times 7.88 6.14

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Liquidity ratios
Liquidity ratios reflect the level of financial health, the ability to pay short-term debts and
ensure that the Company does not fall into illiquidity. The Company’s liquidity ratios remained
stable and were greater than 1 over the years, reflecting the Company’s ability to fully cover its
short-term debt obligations. In 2020, liquidity ratios improved as cash and cash equivalents
increased
Profitability
The AAA’s profitability ratios in 2020 decreased compared to 2019’s as the pandemic
affected the Company’s business activities, especially in industrial real estate segment.
Capital structure
Total liabilities/total assets ratio of the consolidated result decreased compared to 2019’s,
reaching 0.53 times in 2020, and of average level compared to industry peers. Liabilities/owner’s
equity ratio result were 1.13 times, representing improved financial health compared to 2019’s.
Operational efficiency
The Company’s inventory turnover reached 6.14 times, representing a slight decrease
compared to 7.88 times in 2019. The average total asset turnover in 2020 reached 0.9 times,
slightly decreasing compared to 1.19 times in 2019.
4. Forecasting
Because the growth rate of net sales in 2020 has been reduced due to the Covid-19
epidemic, I will project the figures according to the activities the company is performing and
projecting for the future. After that, I found indicators left by taking the ratio of net sales which
was predicted to increase before
I forecast AAA's 2021 net sales will reach VND 8914.3 billion, up 20% compared 2020
because company recovering profits after the epidemic. In which, in 2021, the real estate segment
will increase again thanks to the remaining revenue of Complex area and the Complex 1 real estate
project will start commercialization from Q3, Q4 / 2021. Besides, the company producing plastic
bags continues to increased thanks to the optimization of productivity equipment and contributions
from An Vinh plastic bag company's Jumbo bags. Including:
(1) Thin packaging sales
(2) Jumbo packaging. In 2020, AAA bought An Vinh - a company specializing in the production
of Jumbo packaging.
(3) Industrial real estate
(4) Performance of subsidiary HII has been enhanced continuously, expanded production capacity
and invested in new lines and machines.
Thus, I estimate AAA's after-tax profit to reach VND 651.4 billion, 2.3 times higher than in
2020 with the emphasis on profit from industrial park real estate and growth in the volume of thin
packaging, Jumbo packaging.

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 Table 2: Predictive data summary
2020A 2021F 2022F 2023F 2024F 2025F
Net sales 7428.6 8914.3 10340.6 11581.5 12971.3 14527.8
Net profit 283.2 651.4 846.8 1100.8 1431.0 1860.3
Owner's Equity 4024 5231.2 5754.3 6444.8 7347.1 8375.7
Total asset 8569.4 9683.4 10651.8 11397.4 12423.2 13541.2
ROA 3.3% 6.7% 7.9% 9.7% 11.5% 13.7%
ROE 7.0% 12.5% 14.7% 17.1% 19.5% 22.2%

Scales of increase will be uneven divided into two stages

Net sales
• 2021 increase 20% compared to 2020
• 2022-2025 increase 12% over the years
Net profit:
• 2021 is 2.3 times more than 2020
• 2022-2025 1.3 times the previous year
5. Pricing
AAA's business activities are divided into 3 main segments including plastic packaging
production, plastic additives, and trade primary plastic beads and industrial real estate. Therefore,
I use 2 valuation methods, namely P/E comparison method and discounted cash flow method
(FCFE) with proportion 4:6
Calculating future cash flows based on assumption I predicted before
Table 3: Free cash flow to Equity model in the future (2021-2025)
FCFE 2020 2021F 2022F 2023F 2024F 2025F
EAT (Net income) 283.2 651.4 846.8 1100.8 1431.0 1860.3
Depreciation and amortisation 287.1 205.0 195.0 199.9 187.5 192
Capex 531 -331.5 -99.5 -86 -48.8 0
Denta working capital 24.9 -52.6 -213.6 -284.7 -192.4 -96.3
Net borrowing -186.7 -95.6 307.926 145.6 92.8 -286.272
FCFE (172) 1,145 1,663 1,817 1,953 1,862
FEFE is the amount of cash a business generates that is available to be potential distributed
to shareholders by a formula: FCFE= NI + D&A – Capex - ∆𝑾𝑪 + Net borrowing
• NI is the firm’s net income
• D&A is the Depreciation and amortisation
• Capex is capital expenditure which calculate by looking at the value of assets on
the balance sheet in conjunction with depreciation expense
• Denta working capital chage in working capital
• Net borrowing is the difference between debt principals paid and raised

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Determine the discount rate (ke) by CAMP model
Table 4: Calculate discount rate (ke)
Rf 2.30%
Rm 13.59%
𝛽 0.78
ke 14.69%
Ke is the required return rate for stock AAA
Rf is 10-year government bond yield
Rm is VN-Index market return
𝛽 is beta coeffcient of stock’s AAA
5.1.The pricing process under FEFE method
As mentioned above, due to the company's volatility from 2016-2020, I will predict the growth
rate from my personal opinion on the company's main activities in the future.
The company will growth within two stages:
- Stage 1: Fluctuated growth from 2021 to 2025. Due to the Covid-19 epidemic affecting
industrial real estate leasing and at the same time, AAA is having a strategy to reduce the
proportion of commercial activities, which accounts for a large proportion to increase profit
margin, which is expected after 2022 when most of the commercial activities. If the country
has controlled the epidemic, FDI inflows will grow steadily
- Stage 2: Steady growth from 2025 to infinity. Net sales will mainly depend on production
activities as the real estate segment has stabilized
I predict after 2025 AAA company will grow with growth rate (g) is 8%
Table 5: Stock pricing by FCFE model
2021 2022 2023 2024 2025
FCFE 1,145 1,663 1,817 1,953 1,862
Discount rate (ke) 17.4% 17.4% 17.4% 17.4% 17.4%
PV (FCFE) 975 1,207 1,123 1,028 835
Growth rate after 2025 (g) 8%
FCFE (2025-∞) 21,407
PV(FCFE (2025-∞)) 9,601
Value of equity 14,769
Outstanding shares (mil) 296.8
Intrinsic price of stock 49.760
Instrinsic price of AAA’s stock by FEFE method is VNĐ 49.760

Industry P/E (Price–earnings ratio) method

Find industry P/E: Based on the real data of companies in the same industry with AAA

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 Table 6: Industry P/E
Market Outstanding EAT (2020) Captilization
Stock
Firms in industry price shares (mil) (milVNĐ) (bil VNĐ)
Code (1) (2) (3) (4)=(1)*(2)
APH An Phat Holdings Joint Stock Company 54.3 195.1 242.2 10,594
RDP Rang Dong Holdings Joint Stock Company 10 47.6 3.2 476
BMP Binh Minh Plastics Joint Stock Company 57 81.9 522.6 4,668
CLC Cat Loi Joint Stock Company 31 26.2 128.9 812
DTT Do Thanh Technology Joint Stock Company 14.4 8.2 8.7 118
HPD Binh Duong PP Pack Making Joint Stock Company 13.6 1.9 3.3 26
VBC Vinh Plastic & Bags Joint Stock Company 18.9 7.5 27.7 142
TDP Thuan Duc Joint Stock Company 27.7 53.8 72.7 1,490
TOTAL 241 2,588
Industry P/E= Total captilization/ total outstanding shares 10.73
For P/E method, I average P/E of similar enterprises in the region at 10.73 times.
Table 7: Stock pricing by P/E
Year 2020
EPS (AAA) 1.33
Industry P/E 10.73
Instrinsic price= EPS*Industry P/E 14.27
Instrinsic price of stock AAA by Industry P/E is VNĐ 14,270
5.2. The instrinsic price of AAA
Table 8: Stock pricing after combination FCFE and P/E methods
Proportion Instrinct value
Industry P/E 40% 14.27
FCFE 60% 49.76
Intrinsic price of
35.56
AAA

6. Conclusion
With a positive outlook in 2021, enterprise value according to FCFF method is estimated at
VND 14,769,000 million. Corresponding to the number of outstanding shares of 296.8 million
shares, the recommended price of AAA will be VNĐ 35,560
7. Recommened
Through analysis as well as forecasting of key items in AAA's financial statements, the
results show that the current market is undervaluing AAA shares.
Recommendation: BUY
The current price: VNĐ 16,100
The target price: VNĐ 35,560

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References
AAA 2020 Annual Report
An Phat Bioplastics JSC. Vietstock. At the link https://finance.vietstock.vn/AAA/so-sanh-gia-co-
phieu-cung-nganh.htm
An Phat Bioplastics JSC. CafeF. At the link https://s.cafef.vn/hose/AAA-cong-ty-co-phan-nhua-
an-phat-xanh.chn