3.2.3.

ASSET MANAGEMENT OR TURNOVER MEASURES

Inventory Turnover and Days’ Sales in Inventory
Inventory is a reserve asset class with the aim of ensuring that production is conducted
in a normal, continuous, and stone-meeting meeting of the mayor's needs. Therefore,
every business needs to have a reasonable level of inventory
Cost of goods sold
- Inventory turnover2020 =
Inventory

The inventory turnover coefficient demonstrates the ability to manage inventory.

Inventory turnover is the number of times that the average inventory goods rotate
during the period. The higher the number of inventory turnovers, the shorter the
rotation time, proving that the business is more likely to release warehouse losses,
increase solvenability. However, this index is too high because it means that the stock in
the warehouse is not much, if the market demand increases suddenly, it is very likely
that the business loses customers and is gained market share by competitors Moreover,
the reserve of input materials for the production stages is not enough can cause the line
to be damaged stagnate. Therefore, the inventory turnover index needs to be large
enough to ensure the level of production meets the needs of customers.

Cost of goods sold 93.177 .227

- Inventory turnover2020 = = = 1,49 times
Inventory 62.495 .269
Cost of goods sold 92.485
- Inventory turnover2019 = = =1.10 times
Inventory 83.809

VIC sold off the entire inventory 1,49 times during the year 2020. The inventory index of
2020 is higher than the inventory index in 2019. Shows that VIC 2020 sales faster and
inventories are not used much in the business. Inventory turnover of 2020 high proves
that goods in 2020 are better circulated, production and business situation is effective.
2020 is the year the rotation tends to increase again, due to the company expanding its
business, not recording sales of retail items, so inventory decreases but the company
selling other items increases the price of goods sold
- Days’ sales in inventory: is the time when goods are allowed to stay at the warehouse
of the shipping unit. This is also a point of note that customers when using this value-
added service need to pay attention.
365 days
- Days’ sales in inventory=
Inventory turnover
365 days 365
- Days’ sales in inventory2020= = = 245 days
Inventory turnover 1,49

This tells us that, inventory sits 245 days on average before it is sold
365 days 365
- Days’ sales in inventory2019= = =332 days
Inventory turnover 1.10

Looking at the data, we see that the days’ sales in inventory of 2020 is much less than in
2019.Reduced from 332 days to warehousing to 245 days - that is, down 87 days
compared to 2020. In addition, the inventory time index tells us that the inventory takes
about 245 days on average to be exported for sale. The numbers show that the
company is doing a good job of managing inventory, because the longer it takes, the
lower the company's performance.
- Receivables Turnover and Days’ Sales in Receivables
 Receivables Turnover: The payable turnover coefficient helps to assess a
company's ability to recover its accounts to be recovered or the effectiveness of
its current credit issuance. This coefficient also shows the number of times the
receivables are converted into cash by a company. The receivables coefficient can
be calculated annually, quarterly or monthly
sales
Receivables turnover =
Accounts receivable

The speed of receivable transfers reflects the ability of the enterprise to recover debts
and is determined by the formula:
Sales= 110.490 .033 million vnđ
sales 110.490.033
Receivables turnover2020 = = = 2,11 times
Accounts receivable 52.395 .927
sales 130.161.398
Receivables turnover2019 = = =2,04 times
Accounts receivable 63.871.798

And in VIC's financial analysis, we see that the receivable turnover coefficient in 2020 is
higher than in 2019 from 2.04 rounds / year to 2.11 rounds / year showing the ability to
effectively recover receivables and debts from customers. This increase in the benefit
for VIC is that bad debts are not too much, the cash flow of enterprises increases when
customers pay credit.
 Days’ Sales in Receivables: is the period of time the enterprise collects the
amounts that customers owe the business in the section of accounts of accounts
payable (AR). Companies calculate the average collection period to ensure they have
enough cash to meet their financial obligations.
365 days
Days’ sales in receivables =
Receivables turnover

Kỳ thu tiền của VIC được tính:

365 days 365
Days’ sales in receivables2020 = = = 173 days
Receivables turnover 2,11
365 days 365
Days’ sales in receivables2019 = = = 178 days
Receivables turnover 2,04

Looking at the analysis, the average collection period in 2014 was 178 days, in 2020 it
was 173 days, down 5 days compared to 2019. This shows that the company is doing a
good job of recovering the accounts to be recovered, the company needs to try to
promote this aspect.
Total asset turnover:
 sales
Total asset turnover =
Total assets

The TAT index is used to assess the effectiveness of the use of assets of the business. It
shows how many coins each of the business's assets generates in a single analysis
period, how many rounds the assets spin. The higher the total asset turnover, the
more efficiently the use of the company's assets in production and business activities.-
sales 130.161.398
Total asset turnover2019 = = =0.32 times
Total assets 403.740 .753
sales 110.490 .033
- Total asset turnover2020 = = = 0,26 times
Total assets 422.503 .767

Vic's total asset utilization efficiency decreased from 0.32 in 2019 to 0.26 in 2020. That
is, in 2019, each of VIC's assets will generate 0.32 vnd in revenue and in 2020 the same
will be 0.26. This coefficient tends to be high for some businesses that do business in
certain sectors. However, VIC is a group operating mainly 3 core business areas
including technology, industry, trade in services with large assets, so the total asset
turnover factor is usually relatively low.
3.3.4. PROFITABILITY MEASURES
- Profit Margin:Ros (Return On Sales) index represents a net revenue from sales and
service delivery that generates how much profit (profit after tax). ROS meaning: Ros
targets indicate that one unit of revenue brings several profitable units to the business.
The higher this index, the better the business performance in the business
Net income
Profit Margin=
sales

.
- Net income = 4.545.573 million vnđ
Net income 4.545 .573
- Profit Margin2020= = =4.11 %
sales 110.490.033

VIC generates 40 vnd in net income for every 1000 vnd in sales.
- Net income = 7.716.613 million vnđ
Net income 7.716 .613
- Profit Margin2019= = =5.93%
sales 130.161.398
According to Vingroup's audited consolidated financial statements for 2020 total
consolidated net revenue for the whole year reached VND110,490 billion, down 15.0%
compared to the previous year.
According to the analysis, the profit margin of 2020 decreased compared to 2019, from
6% in 2019 to 4.11% in 2020. VIC has a positive ROS index, i.e. profitable business (Profit
after tax >0). In 2020, VIC generates 41,1 vnd in net income for every 1000 vnd in
sales.However, because in 2020, most businesses are affected by covid-19, leading to a
decrease in revenue compared to previous years, so VIC's ROS index is somewhat
reduced. In addition, ros increase will prove that the business is using the cost
effectively in which the cost is generated from the business. But due to 2020 due to a
part of the increased interest expense, plus the cost of goods sold in 2020, the ROS of
2020 decreased. In addition, in 2020 VIC no longer recorded revenue from retail
activities, resulting in a decrease in revenue from 130,161,398 to 110,490,033 (million
VND units) causing ROS to decrease in 2020.
-EBITDA Margin
EBITDA
EBITDA Margin2019 =
sales

Another commonly used measure of profitability is the EBITDA margin. As mentioned,

EBITDA is a measure of before-tax operating cash flow. It adds back noncash expenses
and does not include taxes or interest expense. As a consequence, EBITDA margin looks
more directly at operating cash flows than does net income and does not include the
effect of capital structure or taxes. For VIC, EBITDA margin is
EBITDA 27931323
- EBITDA Margin2019 = = =21.48%
sales 130161398
EBITDA 34.178.113
- EBITDA Margin2020 = = = 30,9 %
sales 110.490.033

In 2019, profit before tax, interest and depreciation of the company reached VND
27,931,323 (million). In 2020, it reached 34,178,113 (22.36%). The EBITDA growth rate is
higher than the revenue growth rate, so the EBITDA/revenue ratio has increased. In
2020, the EBITDA growth rate is much higher than the revenue ratio, so there is a sharp
increase in the EBITDA/revenue target. In 2019, when there is 1000 VND of revenue, it
will generate VND214.8 (21.48%) of pre-tax profit, interest and depreciation. In 2020, it
will be $309 (30.9%).
- Return on Assets
Return on assets (ROA) is a measure of profit per dollar of assets. It can be defined
several ways but the most common is:

Net income
ROA=
total assets

ROA is a measure of the effectiveness of converting investment capital into profitability.

The ROA provides information on the gains generated from the amount of investment
capital (or the number of assets).The higher the ROA, the more efficiently the
company's ability to use assets.

Net income 4.545 .573

ROA2020= = = 1,08 %
total assets 422.503 .767

Net income 7.716 .613

ROA2019= = = 1,91 %
total assets 403.740 .753

With the results calculated, VIC's ROA over 2 years is positive, which shows that VIC is
profitable but in 2020 it decreased to only 1.08% and in 2019 it was high with 1.91%.
The profitability of assets in 2020 is lower than in 2019, indicating that businesses are
not using assets effectively. With the ROA target in 2019, it is known that 1000 VND of
assets of the enterprise will generate 19.1 (1.91%) of the net profit for the company and
in 2020 1000 asset only generates 10.8 vnd(1.08%) of net profit. The ROA ratio
indicates the profitability of enterprises in the presence of both taxes and financial
leverage, reflecting the effectiveness of the use of assets in enterprises, showing the
level of asset management and use, showing very good asset use efficiency in 2019 but
a sharp decline in 2020.
- Return on Equity

Return on equity (ROE) is a measure of how the stockholders fared during the year.
Because benefiting shareholders is our goal, ROE is, in an accounting sense, the true
bottom-line measure of performance. ROE is usually measured as:

Net income
ROE=
total equity
ROE indicates how much a business's equity generates. If this ratio is of positive value, it
is a profitable business; If the negative value is the business loses business. This depends
on business times. In addition, it depends on the size and level of risk of the business..

Net income 4.545.573

ROE2020= = = 3,35 %
total equity 135.852.715

Net income 7.716 .613

ROE2019= = =6.4%
total equity 120.588.589

With the results calculated, ROE in 2 years showed good profitability on equity but in
2020 this index will plummet to only 3.35% i.e. for every 1000 VND of equity will
generate 33.5 VND of profit and in 2019 this index will increase sharply with 6.4% i.e.
every 1000 VND of equity will generate 64 VND. 6.4% profit. The rate of profit growth
after tax in 2019 is smaller than the rate of equity growth. By 2020, the rate of profit
growth is much smaller than the rate of equity growth, as the company no longer
records retail revenue along with real estate projects being handed over, in addition to
the sharp increase in costs in financial activities leading to a decrease in net profit
compared to previous years. In addition, at the end of 2020 the increase in equity is due
mainly to increased capital contributions from non-controlling shareholders resulting in
lower ROE compared to previous years. Although it has decreased, it is still effective and
brings a lot of value to the company.

ROE > ROA → Using financial leverage

3.3.5. MARKET VALUE MEASURES

1. EPS: It is the after-tax profit that investors earn from a stock. This index is also
understood as a profit that investors get on an initial amount of capital.

EPS2020= [ lãi cơ bản trêncổ phiếu ]= 1,691 vnđ

EPS2019= [ lãi cơ bản trêncổ phiếu ]= 2,293 vnđ
According to the index, VIC's EPS has always been high (>1,500) in recent years.
However, there was a decrease in 2020 compared to the previous year, but the
company still operates sustainably leading to the company doing business
effectively.2.PE: The price-to-earnings ratio is used to assess the market's expectations
of the company's profitability and indicate how the investor will pay for a current
income.

Price per share

PE ratio=
EPS

The P/E index represents the price you are willing to pay for a dollar of stock profit.
The P/E is understood to mean how much investors are willing to pay for a dollar of
profit..

- Shares outstanding= 3.296.512.088 shares

- Book value per share= 10.000 vnđ
- EPS= [ lãi cơ bản trêncổ phiếu ]= 1.691 vnđ
- Price–Earnings Ratio
Price per share= 96,18 x 1000 vnđ = 96.180 vnđ ((31/12/2020)
Price per share 96.180
PE ratio2020= = = 56,88 times
EPS 1.691
Price per share
PE ratio2019= = 47.33 times
EPS

As analyzed above, VIC's PE index is quite high, rising from 47.33 in 2019 to 56.88 in
2020. With this P/E level, the market expects vic's profitability to be quite ideal. With
such a high P/E ratio, investors can expect high dividend growth in the future, low-risk
stocks, thereby predicting the company has an average growth rate and will pay a high
dividend.
2. Market-to-Book Ratio
A second commonly quoted measure is the marketto-book ratio:
market value per share
- Market-to-Book Ratio=
book value per share

The market value ratio of book value reflects the mayor's assessment of the company's
future prospects or the amount payable for 1 equity coin.
Book value per share is an accounting number that reflects historical costs. In a loose
sense, the market-to-book ratio therefore compares the market value of the firm’s
investments to their cost. A value less than 1 could mean that the firm has not been
successful overall in creating value for its stockholders
market value per share 96.180
- Market-to-Book Ratio2020 = = = 9,618 times
book value per share 10.000
market value per share 102.22
- Market-to-Book Ratio2019 = = =10.222 times
book value per share 10.000

According to the results of the analysis, VIC has a lower market value ratio to book
value in 2020 than in 2019. Specifically: in 2019 reached 10,222 to 9,618 in 2019.
Although there is a decrease, the company is still highly valued, has a very good future
prospects. The company has many valuable assets such as real estate, patents, holding
other company shares, multidisciplinary development. VIC has a growth orientation, so
the P/B index is very high and has a higher index than other companies in the industry.
3. - Market Capitalization:The market capitalization of a public firm is equal to the firm’s
stock market price per share multiplied by the number of shares outstanding.
Market Capitalization = Price per share x Shares outstanding
The market capitalization depends on the market price of the stock and the volume of
shares currently circulating on the stock market. Since the stock market price is
frequently subject to fluctuations in the stock market over time, the market
capitalization of the business also frequently changes.

- Market Capitalization = Price per share x Shares outstanding = 96.180 x 3.296.512.088

= 317.058.532,6 Million vnđ
As a result, vic's market capitalization in 2020 reached the highest level compared to the
most in the same industry. In recent years, VIC has been seen as one of the enterprises
with a large market capitalization (>10000 billion) often called blue chip due to both the
stock and the large market price. Large market capitalizations are also relatively stable,
safe and reliable. Vic's high capitalization shows that the size of the business's
operations is also expanding, the growth potential and the evaluation of the market
with the company. When vic's capitalization is high, it helps large investors avoid the
liquidity risk of stocks in the market. This helps shareholders or investors divest quickly
and without much cost when carrying out divestment.
4.- Enterprise Value (EV):
Enterprise value is a measure of firm value that is very closely related to market
capitalization. Instead of focusing on only the market value of outstanding shares of
stock, it measures the market value of outstanding shares of stock plus the market value
of outstanding interest bearing debt less cash on hand.
Enterprise Value (EV )= Market capitalization + Market value of interest bearing debt –
Cash.
- Market value of interest bearing debt = 25.971.982 + 98.309.224 = 124.281.206
million vnđ
- Enterprise Value (EV)2020= Market capitalization + Market value of interest bearing debt
– Cash = 317.058.532,6 + 124.281.206 - 9.403 .688 = 431.936.050,6 million vnđ
- Enterprise Value (EV)2019= Market capitalization + Market value of interest bearing debt
– Cash =
The purpose of the EV measure is to better estimate how much it would take to buy all
of the outstanding stock of a firm and also to pay off the debt. The adjustment for cash
is to recognize that if we were a buyer the cash could be used immediately to buy back
debt or pay a dividend.
- Enterprise Value Multiples (EV Multiples): Financial analysts use valuation multiples
basedupon a firm’s enterprise value when the goal is to estimate the value of the firm’s
totalbusiness rather than just focusing on the value of its equity. To form an appropriate
multiple, enterprise value is divided by EBITDA
EV
- Enterprise Value Multiples (EV Multiples) =
EBITDA
EV 431.936 .050,6
- Enterprise Value Multiples (EV Multiples) 2020 = = = 12,64 times
EBITDA 34.178 .113

Above and beyond, the high EV multiples index compared to other companies in the
same industry shows good quality VIC, stable growth