Valuation Statistics - Vinamilk

Methodology Name
Public Company Comparables:
Trailing EV / Revenue:
2013E EV / Revenue:
Trailing EV / EBITDA:
2013E EV / EBITDA:
Trailing P/E:
2013E P/E

Vinamilk - Range of Valuation Multiples / Premiums

Minimum
Multiple

25th
Pecentile
Multiple

0.5 x
0.5 x
9.0 x
8.2 x
18.2 x
15.5 x

1.3 x
1.1 x
15.0 x
11.8 x
24.6 x
20.1 x

Median
Multiple

1.3 x
1.1 x
20.9 x
15.8 x
28.9 x
25.6 x

75th
Pecentile
Multiple

2.0 x
1.7 x
22.0 x
17.5 x
35.9 x
31.8 x

Maximum
Multiple

7.3 x
4.3 x
37.2 x
22.7 x
56.6 x
46.0 x

Vinamilk - Impl
Applicable
Vinamilk
Figure

28,421,157
32,854,724
7,109,042
7,316,892
6,362,233
6,832,177

Discounted Cash Flow Analysis:

14.3%-18.3% Discount Rate, 5.0-7.0x Terminal Multiple:

Minimum
Multiple

29-Oct-65
26,663
82,462
78,193
139,000
118,441

20-May-29

Units: VND million

Valuation Summary

Valuation Date:
Company Name:
Share Price:

13/09/2013
Vinamilk
139,000

Basic Shares Outstanding:

Basic Equity Value (VNDm)

833,955,796
115,919,856

Less: Cash & equivalent

Plus: Debt
Plus: Minorities Interest
Enterprise Value

(4,912,485)
111,007,370

Valuation Multiples

EV / Revenue:
EV / EBIT:
EV / EBITDA:

Unit:
Currency:
USD /VND

Historical
2011A
2012A
5.13
23.46
25.72

4.18
16.47
17.89

2013E
3.38
13.90
15.17

1,000,000
VND
21,500

2014E
2.80
11.24
12.39

Forecast
2015E
2.31
9.21
10.06

2016E
1.93
7.65
8.28

2017E
1.60
6.35
6.80

Equity Value / FCF:

P / E:
P / BV:

85.97
27.48
9.29

33.57
19.92
7.48

27.94
16.97
6.06

14.33
13.76
4.79

11.99
10.99
3.71

9.16
8.89
2.87

7.74
7.19
2.21

Vinamilk - Implied Per Share Value Range

25th
Pecentile
Multiple

Median
Multiple

75th
Pecentile
Multiple

Maximum
Multiple

VNM Statistics
Net Debt (VND mn)

12-Mar-33
47,648
133,598
109,172
187,755
153,576

9-Aug-36
50,416
183,653
144,656
220,360
195,367

15-Jul-02
71,206
193,585
159,747
273,691
242,361

25-Jan-00
174,951
323,001
204,904
431,441
350,905

16-Nov-55

29-Apr-85

1-Feb-18

20-Jul-54

Shares Outstanding (mn)

(4,912,485)
834

Public Comparables Valuation

Trailing EV / Revenue:

2013E EV / Revenue:

Trailing EV / EBITDA:

2013E EV / EBITDA:

Trailing P/E:

2013E P/E

Discounted Cash Flow Valuation

14.3%-18.3% Discount Rate, 5.0-7.0x Terminal Multiple:
-

50,000

Min.
14.3%-18.3% Discount Rate, 5.0-7.0x Terminal Multiple:

120,306

2013E P/E
Trailing P/E:
2013E EV / EBITDA:
Trailing EV / EBITDA:
2013E EV / Revenue:
Trailing EV / Revenue:

118,441
139,000
78,193
82,462
26,663
24,044

100,000

Min to 25th
25th to Median
Median to 75th
75th to Max

Share Price (9/20/13)

VND 139,000

100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000

25th
129,983

Median
140,739

75th
152,704

Max
166,022

Min Point
120,306

153,576
187,755
109,172
133,598
47,648
48,651

195,367
220,360
144,656
183,653
50,416
49,897

242,361
273,691
159,747
193,585
71,206
73,976

350,905
431,441
204,904
323,001
174,951
255,697

118,441
139,000
78,193
82,462
26,663
24,044

Min to 25th
25th to Median
Median to 75th
75th to Max

(9/20/13)

25 Point
9,677
35,135
48,755
30,979
51,136
20,985
24,607

Med Point
75 Point
Max Point
10,756
11,965
13,318
41,791
32,605
35,484
50,055
2,768
1,246

46,993
53,331
15,090
9,932
20,790
24,080

108,544
157,750
45,157
129,416
103,745
181,721

Vinamilk Income Statement

Units: VND million, except per share data

2005A
Net Revenue
COGS
Gross profit
Selling expenses
G & A expenses
EBITDA
Deprication & Amortization
Operating Profit
Financial income
Interest income
Investment income
Other financial income
Financial expense
Interest expense
Change in provision for investment
Other financial expense
Net other income
Earning before tax
Income tax paid
Deffered tax
Net income
Minority Interest

Allocation of D&A
COGS
Selling expense
G&A expense
Other income
Gain/Loss from fixed asset disposals
Income from disposals
Remaining cost of assets
Other income/expense

2007A

2008A

5,638,784
4,379,796
1,258,988
654,102
80,438
524,448

6,619,102
5,012,632
1,606,470
899,396
112,888
594,186

6,537,964
4,836,283
1,701,681
864,363
204,192
633,126

8,208,982
5,610,969
2,598,013
1,052,308
297,804
1,247,901

55,373

74,253

227,327

190,860

19,988
10,030

40,002
21,192

25,862
11,667

197,621
26,971

42,767
602,600
2,884
605,484
-

106,032
734,469
(2,884)
731,585
-

120,790
955,381
8,017
963,398
(50)

130,173
1,371,313
161,874
39,259
1,248,698
(1,422)

731,585

963,448

1,250,120

3,801
159
1,006
728
21%

5,607
172
1,225
786
22%

7,132
175
1,559
802
27%

Net income attributable to Equity Shareholders 605,484

EPS
Number of share adjusted
EPS adjusted
Number of share adjusted for bonus issuance
EPS Growth

2006A

3,816
159
834
726

OPERATING ASSUMPTIONS
Revenue Growth
Gross margin
Selling expense (% revenue)
Admin expense (% revenue)
Operating margin
EBITDA Margin
Other financial income (% revenue)
Other financial expense (% revenue)
Net Other income excl disposal (% revenue)
Effective tax rate
Net margin %
Net margin Growth

17.4%
24.3%
13.6%
1.7%
9.0%

-1.2%
26.0%
13.2%
3.1%
9.7%

25.6%
31.6%
12.8%
3.6%
15.2%

1.0%
0.4%
1%
0%
10.7%

1.1%
0.6%
2%
0%
11.1%
21%

3.5%
0.4%
1.8%
1%
14.7%
32%

2.3%
2.4%
1.6%
15%
15.2%
30%

2005A

2006A

2007A

2008A

2,332,000
38.0%

2,380,605
2.1%

35.7%

29.0%

1,736,000
4.6%

2,216,425
27.7%

26.6%

27.0%

1,584,000
-27.7%

2,380,605
50.3%

22.3%
11.6%
1.4%
9.3%

Effective cash interest rate

Investment yield
Debt interest rate

DETAILED SALES FORECAST

VND million
Segment
Condensed milk
Revenue
Growth
In which: Price growth
In which: Volume growth
% Market share
% Total Revenue
COGS
Gross profit
Gross margin %
Liquid milk
Revenue
Growth
In which: Price growth
In which: Volume growth
% Market share
% Total Revenue
COGS
Gross profit
Gross margin %
Powdered milk
Revenue
Growth

1,690,000

25.5%

1,659,000

25.1%

2,191,000

In which: Price growth

In which: Volume growth
% Market share
% Total Revenue
COGS
Gross profit
Gross margin %
Yoghurt
Revenue
Growth
In which: Price growth
In which: Volume growth
% Market share
% Total Revenue
COGS
Gross profit
Gross margin %
Beverages
Revenue
Growth
In which: Price growth
In which: Volume growth
% Market share
% Total Revenue
COGS
Gross profit
Gross margin %

33.1%

634,000

9.6%

445,102

6.7%

24.2%

29.0%

698,000
10.1%

985,078
41.1%

10.7%

12.0%

187,964
-57.8%

246,269
31.0%

2.9%

3.0%

6,537,964
-1.2%

8,208,982
25.6%

Exports
Revenue
Powder revenue
Liquid & condensed revenue
Growth
In which: Price growth
In which: Volume growth
% Market share
% Total Revenue
COGS
Gross profit
Gross margin %
Total
Revenue
Growth
% Total Revenue

6,619,102

COGS
Gross profit
Gross margin %

DETAILED WORKING
Market
Average milk consumption per capital (liter)
CAGR of consumption per capita
Population growth (%)
Estimated milk consumtion growth
Domestic production volume (ton)
Liquid milk (000' litres)
Powdered milk (ton)

110,000

Total volume consumed (by units)

Condensed milk ('000 cans)
Liquid milk (000' litres)
Powdered milk (ton)
Yoghurt (000' litres)
Drinking yoghurt (000' litres)
VINAMILK DATA
Average Selling price (VNDm/ton)
Average volume sold (ton)
Condensed milk
Liquid milk (litre)
Powdered milk
Yoghurt
Beverages
Export - powder
Export - liquid
Average market share (%)
Condensed milk
Liquid milk
Powdered milk
Yoghurt
Beverages
Export - powder

Production capacity
Designed capacity (ton)
Condensed milk ('000 cannes)
Liquid milk ('000 lit)
Powdered milk (ton)
Yoghurt ('000 lit)
Beverages
Selling price growth
Condensed milk
Liquid milk
Powdered milk
Yoghurt
Beverages
Export - powder
Volume growth
Condensed milk
Liquid milk

37%
79%
35%
14%
60%

504,000
260,000
237,000
18,000
56,000

Powdered milk
Yoghurt
Beverages
Export - powder
PRICE FORECAST
- Price Increase
Period
06-12
CAGR
- GDP per capita
Year
4-Jul-05
12-Jul-05
CAGR
- Price Increase Forecast
Liquild milk
Yoghurt
Condensed milk
Powdered milk
- VNM wants to win market share thanks to its outstanding capacity
- Market Segmentation: Increasing Mid-end customers.
- Price Increase grows in line with GDP per capita of mid-end customers.
CONDENSED MILK
- Current market share: 80%.
- VNM restructures its plants into separate manufacturing divisions: Liquild milk, yoghurt; Condensed milk; Powder Milk
and it aims to win market share of liquid milk & Powdered milk.
- Condensed milk is forecasted to grow thanks to Price Increase, not capacity
Condensed Milk

LIQUID MILK
- National-wide raw fresh milk CAGR 2009-2012: 11.15% (Vietnam Husbandry Department)
- Currently, VNM buys 40% total national raw fresh milk each year.
and imports 60% rest for production.
Total raw fresh milk input is equal to total suppy from domestic farmers.
(Tons)
Total Domestic Supply
Total VNM Demand
Growth
Domestic supply for VNM
% Share
Import
% Share

- VNM will maintain the proportion of raw fresh milk 40:60 between domestic supply & import.
- Total Raw fresh milk demand for production will grow at 12% CAGR (2013-2017)
(slightly higher than the period 09-12), in line with liquild milk consumpsion per capita
for the period 2012-2015

Year
4-Jul-05
7-Jul-05
12-Jul-05
CAGR '12-15
CAGR '12-20

Liquild Milk

POWDERED MILK
- Current VNM's powdered milk capacity:
, equal to total domestic demand.
- VNM wants to win additional 5-10% market share , however, due to the high demand for foreign powdered milk brands
, and it takes time to change the consumer's taste, we only forecast VNM will gain 1.5% current market share per year.

- 2012 capacity: 13,500 tons. This year, from Q2, VNM has launched its new powdered milk plant with capacity 54,000 tons
(4x last year capacity).
(tons)
VNM's Domestic volume
Growth
Domestic Powdered Milk's
Revenue Growth
- If VNM fully utilizes 100% of its capacity in 2017
Export
VNM's Export volume
Growth
Export Powdered Milk's Revenue Growth

Utilization
Total capacity used in year (ton)
Growth
Utilization (New Factory)

Utilization (Total)
- '13-17 CAGR Powdered Milk Capacity outgrows industry (6-8%) due to the outstanding supply
YOGHURT
Yoghurt
*Equal liquild milk's growth
BEVERAGES
Beverages

EXPORTS
VNDm
Powdered milk revenue
Growth
Others revenue
Growth
Total revenue
Growth
COSTS ANALYSIS

Historical
2011A

2012A

35%
21,627,429
14,701,505
6,925,924
1,786,087
408,470
4,731,367
414,590
4,316,777

32%
26,561,574
17,036,272
9,525,303
2,320,136
465,106
6,740,060
534,303
6,205,757

135,959
2,731,358
361,536
6,246
2,376,067
375

448,296
196,900
78,359
173,037
153,199
6,172
(3,674)
150,701
608,786
4,251,207
645,059
9,344
3,615,493
(693)

671,419
366,519
123,566
181,334
246,430
13,933
42,357
190,140
237,226
4,978,992
778,589
(17,778)
4,218,182
-

487,765
250,232
112,677
124,856
51,171
3,115
(77,210)
125,266
287,317
6,929,668
1,137,572
(27,359)
5,819,455
-

2,375,693

3,616,186

4,218,182

5,819,455

6,769
351
2,959
803
90%

10,251
353
4,481
807
51%

7,717
547
5,060
834
13%

6,981
834
6,981
834
38%

289,533
228,581
31,490
29,462

414,590
337,801
25,828
50,962

534,303
448,559
25,653
60,091

352,802
701,993
349,191
255,983

(22,449)
58,616
81,065
259,675

(20,674)
38,250
58,924
307,991

2009A
10,613,771
6,735,062
3,878,709
1,245,476
292,942
2,340,291

439,936

184,828
6,253

2010A
15,752,866
10,350,627
5,402,239
1,406,696
358,685
3,636,858
289,533
3,347,325

Circular Break?

2-Jan-00

2013E

2014E

32,854,724
21,422,616
11,432,108
2,869,838
575,302
7,986,967
670,075
7,316,892

1-Jan-00
2-Jan-00
Projected
2015E

39,627,204
25,593,149
14,034,055
3,461,410
693,892
9,878,753
921,434
8,957,319

48,017,585
30,925,391
17,092,194
4,194,304
840,811
12,057,078
1,025,998
11,031,080

643,289
293,651
86,039
263,599
205,550
(47,149)
252,699
380,962
8,135,593
1,303,417

879,279
474,809
86,535
317,936
265,308
(39,482)
304,789
459,491
10,030,782
1,607,048

1,287,668
797,777
104,637
385,253
320,410
(48,914)
369,323
556,781
12,555,120
2,011,476

6,832,177
-

8,423,734
-

10,543,644
-

6,832,177

8,423,734

10,543,644

834
8,192
834
17%

834
10,101
834
23%

834
12,643
834
25%

670,075
562,542
32,172
75,361

921,434
773,563
44,241
103,630

1,025,998
861,347
49,261
115,390

17%

29.3%
36.5%
11.7%
2.8%
22.0%
4.1%
1.7%
1.3%
13%
22.4%
90%

48.4%
34.3%
8.9%
2.3%
23.1%
21.2%
1.1%
1.0%
1.6%
15%
23.0%
52%

37.3%
32.0%
8.3%
1.9%
21.9%
20.0%
0.8%
0.9%
1.2%
15%
19.5%
17%

22.8%
35.9%
8.7%
1.8%
25.4%
23.4%
0.5%
0.5%
1.2%
16%
21.9%
38%

23.7%
33.1%
8.7%
1.8%
24.3%
22.3%
0.8%
0.8%
1.2%
16%
20.8%
17%

20.6%
33.5%
8.7%
1.8%
24.9%
22.6%
0.8%
0.8%
1.2%
16%
21.3%
23%

21.2%
33.8%
8.7%
1.8%
25.1%
23.0%
0.8%
0.8%
1.2%
16%
22.0%
25%

8%
4%
2%

13%
9%
5%

6%
8%
10%

6%
7%
10%

6%
7%
10%

6%
7%
10%

2009A

2010A

2011A

2012A

2013E

2014E

FORECAST
2015E

2,388,098
0.3%

3,100,363
29.8%

3,658,794
18.0%

3,988,086
9.0%

4,386,895
10.0%
10.0%
0.0%
80%
13.4%
3,281,398
1,105,496
25.2%

4,825,584
10.0%
10.0%
0.0%
80%
12.2%
3,609,538
1,216,046
25.2%

5,308,142
10.0%
10.0%
0.0%
80%
11.1%
3,970,492
1,337,650
25.2%

22.5%

19.9%
2,331,473
768,890
24.8%

16.9%
2,788,004
870,790
23.8%

80.0%
15.0%
2,911,303
1,076,783
27.0%

3,268,405
47.5%

5,180,166
58.5%

7,171,596
38.4%

9,024,736
25.8%

30.8%

33.3%
3,527,693
1,652,473
31.9%

33.2%
4,959,035
2,212,561
30.9%

52.0%
34.0%
5,866,078
3,158,658
35.0%

1,889,251
-20.6%

2,974,937
57.5%

3,743,242
25.8%

4,184,792
11.8%

11,118,475
13,697,961
16,875,888
23.2%
23.2%
23.2%
10.0%
10.0%
10.0%
12.0%
12.0%
12.0%
52%
51%
51%
33.8%
34.6%
35.1%
7,227,009
8,903,675
10,969,327
3,891,466
4,794,286
5,906,561
35.0%
35.0%
35.0%
market share tang 1%, market share hien tai la 25%. Market
5,736,340
37.1%

7,535,280
31.4%

9,869,969
31.0%

10.0%
19.4%
28%
19.0%
4,695,506
2,839,774
37.7%

10.0%
19.1%
30%
20.6%
6,150,335
3,719,633
37.7%

4,934,573
23.2%
10.0%
12.0%
90%
15.0%
2,960,744
1,973,829
40.0%

6,079,394
23.2%
10.0%
12.0%
90%
15.3%
3,647,636
2,431,757
40.0%

7,489,813
23.2%
10.0%
12.0%
90%
15.6%
4,493,888
2,995,925
40.0%

17.8%

19.1%
1,850,411
1,124,526
37.8%

24.5%
17.3%
2,423,408
1,319,834
35.3%

1,624,756
64.9%

1,763,012
8.5%

3,057,508
73.4%

4,005,335
31.0%

15.3%

11.3%
902,662
860,350
48.8%

14.1%
1,898,604
1,158,904
37.9%

15.1%
2,283,041
1,722,294
43.0%

275,746
12.0%

902,303
227.2%

1,223,424
35.6%

1,646,202
34.6%

1,975,442
20.0%
20.0%
0.0%

2,370,531
20.0%
20.0%
0.0%

2,844,637
20.0%
20.0%
0.0%

2.6%

5.8%
461,979
440,324
48.8%

5.7%
746,210
477,214
39.0%

6.2%
974,970
671,232
40.8%

6.0%
1,185,265
790,177
40.0%
3,354,000.00

6.0%
1,422,319
948,212
40.0%
71%

5.9%
1,706,782
1,137,855
40.0%

4,703,000
3,680,609
1,022,391
30.1%
5.0%
92.4%

5,118,454

5,629,136

67.4%

3,712,423
1,912,690
1,799,733
33.9%

8.8%
5.0%
-1.9%

10.0%
5.0%
-1.9%

1,167,515

1,656,758

2,772,865

25.0%
15.8%
2,510,875
1,673,917
40.0%

10.0%
24.6%
27%
17.5%
3,574,521
2,161,818
37.7%

11.0%

10.6%
1,329,664
327,094
19.7%

12.8%
2,224,045
548,820
19.8%

14.0%
2,938,063
774,360
20.9%

14.3%
3,756,221
946,779
20.1%

12.9%
4,088,038
1,030,416
20.1%

11.7%
4,495,913
1,133,223
20.1%

10,613,771
29.3%

15,577,539
46.8%
100.0%

21,627,429
38.8%
100.0%

26,561,574
22.8%
100.0%

32,854,724
23.7%
100.0%

39,627,204
20.6%
100.0%

48,017,585
21.2%
100.0%

10,403,882
5,173,657
33.2%

15,039,306
6,588,123
30.5%

17,484,330
9,077,244
34.2%

21,985,158
10,869,566
33.1%

26,366,712
13,260,491
33.5%

31,786,738
16,230,847
33.8%

KEY DRIVERS - SENSITIVITY ANALYSIS

Price Increase
Volume Increase
per year
per year (%)
Condensed Milk
10%
0%
Liquid Milk
10%
12%
Powdered Milk Domestic 10%
19%
Yoghurt
10%
12%
Beverages
20%
0%
Exports
5%
-2%

ton
Domestic Capacity
Growth

2012A
18,050

Revenue

2013E
22,493
25%

2014E
26,861
19%

2015E
31,985
19%

37.1%

31.4%

31.0%

- If VNM utilizes maximum its capacity to 2017, its capacity's growth will be 15% for the peri
Forecast
ton
2012A
2013E
2014E
2015E
VNM's Export Capacity 15,590
30,000
29,416
28,842
Growth
-2%
-2%
Export Powdered Milk'sRevenue Growth
7.9%
7.9%

Unitilization rate
2012A
Capacity
33,640
Growth
Utilization rate (Total)

2013E
52,493
56.0%
78%

2014E
56,276
7.2%
83%

Forecast
2015E
60,827
8.1%
90%

- 13-17 CAGR Powdered Milk Capacity outgrows industry (7%) due to the outstanding supply

2,012
15-Jan-00

1,510
5-Jul-05

6-Jul-05

12%
1.03%
13.02%

12%
1.03%
13.02%

7-Jul-05
21-Jan-00
12%
1.03%
13.02%
660,000
80,000

377,000
480,000
47,000
86,000

356,080

80%
50%
25%
90%

789,063
75,100

891,809
84,879

1,007,932
95,931

1,139,177
108,422

410,313
18,050

459,551
22,493

514,697
26,861

576,460
31,985

15,590

30,000

29,416

28,842

80%
52%
25%
90%

80%
52%
27%
90%

80%
51%
28%
90%

80%
51%
30%
90%

677,150
400,000
13,500

800,000
67,500

800,000
67,500

800,000
67,500

36,000

10%
10%
10%
10%
20%
5%

10%
10%
10%
10%
20%
5%

10%
10%
10%
10%
20%
5%

0%
12%

0%
12%

0%
12%

25%
12%
0%
92%

19%
12%
0%
-2%

19%
12%
0%
-2%

Forecast
7-Jul-05
536,682
576,460
12%
230,584
40%
345,876
60%

8-Jul-05
601,084
645,635
12%
258,254
40%
387,381
60%

9-Jul-05
673,215
723,112
12%
289,245
40%
433,867
60%

Powderer Milk Liquild Milk

30-Jan-00
1-Jan-00
76.3%
10.8%
Disposable
Income
1,555
3,215
9.5%
2013-2017
10%
10%
10%
10%

nsed milk; Powder Milk

Revenue CAGR
10%

345,701

4-Jul-05
382,000
410,313

10.50%
161,591
42%

5-Jul-05
427,840
459,551
12%
183,820
40%
275,730
60%

6-Jul-05
479,181
514,697
12%
205,879
40%
308,818
60%

Bo sua

Liquild milk
Consumpsion
per capita
(liters)
15
21
27
11.9%
5.2%

Revenue CARG
23.2%
In which
Current factory New factory
13,500
54,000

67,500 (tons)

n powdered milk brands

market share per year.
with capacity 54,000 tons,

4-Jul-05
18,050

4-Jul-05
15,590

4-Jul-05
33,640

5-Jul-05
22,493
25%

6-Jul-05
26,861
19%

Forecast
7-Jul-05
31,985
19%

8-Jul-05
35,708
12%

9-Jul-05
39,770
11%

37.1%

31.4%

31.0%

22.8%

22.5%

5-Jul-05
30,000
92%

6-Jul-05
29,416
-2%
3.0%

Forecast
7-Jul-05
28,842
-2%
3.0%

8-Jul-05
28,280
-2%
3.0%

9-Jul-05
27,730
-2%
3.0%

6-Jul-05
56,276
7.2%
79%

Forecast
7-Jul-05
60,827
8.1%
88%

8-Jul-05
63,988
5.2%
93%

9-Jul-05
67,500
5.5%
100%

5-Jul-05
52,493
56.0%
72%

249%

78%

83%

90%

95%

100%

5-Jul-05
3,780,000

6-Jul-05
3,891,673
3.0%
1,365,000
30%
5,256,673
9%

Forecast
7-Jul-05
4,006,645
3.0%
1,774,500
30%
5,781,145
10%

8-Jul-05
4,125,014
3.0%
2,306,850
30%
6,431,864
11%

9-Jul-05
4,246,880
3.0%
2,998,905
30%
7,245,785
13%

Revenue CARG
23.2%

Revenue CARG
20.0%

7-May-10
4-Jul-05
-

1,050,000
3,712,423

4,830,000
30%

Yes
No

rojected
2016E

2017E

57,654,501
37,106,275
20,548,226
5,036,083
1,009,558
14,502,584
1,089,783
13,412,802

69,407,053
44,652,441
24,754,612
6,062,660
1,215,351
17,476,601
1,153,585
16,323,015

1,832,638
1,243,906
126,160
462,572
387,264
(56,181)
443,445
668,524
15,526,700
2,487,558

2,541,345
1,832,784
151,696
556,865
465,325
(68,514)
533,839
804,799
19,203,835
3,076,677

13,039,142
13,039,142

1H 2012A
12,887,269
8,458,758
4,428,511
1,030,988
218,223
3,179,300
249,082
2,930,218

1H 2013A
14,746,852
8,885,104
5,861,748
1,434,530
264,395
4,162,823
329,321
3,833,502

Trailing IS
28,421,157
17,462,617
10,958,540
2,723,678
511,278
7,723,584
614,542
7,109,042

16,127,158
-

307,135
146,848
94,039
66,247
679
3,024
(54,943)
52,597
133,059
3,369,732
628,128
34,515
2,776,119
-

251,454
160,940
43,247
47,267
43,723
13,445
30,278
73,241
4,114,473
765,650
24,791
3,373,615
-

432,083
264,323
61,884
105,876
94,215
91
(8,822)
102,947
227,499
7,674,409
1,275,093
(37,083)
6,362,233
-

16,127,158

2,776,119

3,373,615

6,362,233

3,330
834
3,329

4,047
834
4,045

834
7,629

834
15,635
834
24%

834
19,338
834
24%

1,089,783
914,895
52,323
122,564

1,153,585
968,459
55,387
129,740

22%

249,082
207,254
12,976
28,852

329,321
283,239
12,963
33,120

614,542

524,544
25,640
64,359

20.1%
34.1%
8.7%
1.8%
25.2%
23.3%
0.8%
0.8%
1.2%
16%
22.6%
24%

20.4%
34.3%
8.7%
1.8%
25.2%
23.5%
0.8%
0.8%
1.2%
16%
23.2%
24%

6%
7%
10%

6%
7%
10%

2016E

2017E

34.4%
8.0%
1.7%
24.7%
22.7%
2.4%
0.0%
1.0%
19%
21.5%

14.4%
39.7%
9.7%
1.8%
28.2%
26.0%
1.7%
0.3%
0.5%
19%
22.9%
22%

38.6%
9.6%
1.8%
27.2%
25.0%
1.5%
0.3%
0.8%
17%
22.4%

ORECAST

5,838,957
10.0%
10.0%
0.0%
80%
10.1%
4,367,541
1,471,415
25.2%

Assumptions

CAGR
6,422,852 10.0%
10.0%
(2) Condensed milk revenue growth thanks to price growth CARG 9%-10% per year (2
10.0%
Nhom 1; tang deu 9% moi nam, do gia tang 9%
0.0%
Nhom 2: gia tang 7%, theo lam phat 7%
80%
Comment: tot khi tinh den kha nang bao hoa cua thi truong & thi phan hien tai (80%)
9.3%
4,804,295
1,618,557
25.2%
- Gross margin = Average GM '10-12

CAGR
20,791,094
25,614,628 23.2%
258
413
578
23.2%
23.2%
(3) Liquid milk will grow at 23.2% per year.
10.0%
10.0%
Nhom 1: gia tang 9%, san luong: thi truong sua nuoc se tang 12% moi nam den 2015
12.0%
12.0%
Volume co the hap thu duoc.
53%
56%
Comment: chua tinh den tang truong dan so. Co tinh den kha nang hap thu cua nha m
36.1%
36.9%
Nhom 2: gia tang 7%, tang tu 215 len 400 trong 2 nam (2013: 8 thang dau nam 215 t
13,514,211
16,649,508
Comment: co tinh den toc do tang capacity khi tinh revenue: Tot. Can xem ve kha nan
7,276,883
8,965,120
35.0%
35.0%
- Gross margin may improve y-o-y thanks to economy of scale & VNM can transfer se
hien tai la 25%. Market growth la 20% -> company growth
to customers
la 21% thanks to an increasing demand.
CAGR
12,120,691
14,849,813 28.8%
22.8%
22.5%
(4) Powdered milk consumption grows at 28.8% for the period 2013-2017

10.0%
11.6%
31%
21.0%
7,552,842
4,567,849
37.7%

9,227,449
23.2%
10.0%
12.0%
90%
16.0%
5,536,470
3,690,980
40.0%

3,413,564
20.0%
20.0%
0.0%

10.0%
11.4%
33%
21.4%
9,253,457
5,596,356
37.7%

- Gross margin = Average GM '10-12. VNM wants to win market share thanks to its o
capacity & slightly improves its selling price modest compared to its rivals.

CAGR
11,368,218 23.2%
23.2%
(5) Yoghurt will grow at 23.2% for the period 2013-2017
10.0%
12.0%
90%
16.4%
6,820,931
4,547,287
40.0%
- Gross margin maintains stable @ 40% due to saturated market & stable demand fo
leader.
CAGR
4,096,277 20.0%
20.0%
(6) Beverages grows at 20% for the period 2013-2017
20.0%
0.0%

5.9%
2,048,139
1,365,426
40.0%

5.9%
2,457,766
1,638,511
40.0%

6,262,745

7,055,265

11.3%
5.0%
-1.9%

12.7%
5.0%
-1.9%

10.9%
5,001,968
1,260,777
20.1%

10.2%
5,634,942
1,420,322
20.1%

57,654,501
20.1%
100.0%

Nhom 1: gia tang 9%, ve tong gia tri (value) cua tang khoang 20%, bang voi toc do ta
Comment: chua tinh den tang truong ve capacity cua nha may moi?
Nhom 2: gia tang 7%, nha may moi (54k) hoat dong tu Thang 4/2013, moi nam tang
Comment: can xem ve kha nang hap thu capacity tang them nay. Neu tinh tang truon

- Gross margin is stable thanks to the growing market.

CAGR
13.7%

(7]) Exports grows at 14.3% for the period 2013-2017

- Gross margin is stable, not much changed.

CAGR
69,407,053 21.2%
20.4%
- Revenue CAGR 2013-2017 @ 21.2%
100.0%
: higher than CEO's guide (18.3%)

38,021,170
19,633,330
34.1%

45,620,900
23,786,153 33.7% - Average GM is 33,7%, slightly higher than the trend in the past and the company's p
34.3%

Sales Growth
10.0%
23.2%
31.4%
23.2%
20.0%
3.0%

2016E
35,708
12%
22.8%

2017E CAGR
39,770 17.1%
11%
22.5%

will be 15% for the period '13-17:

Forecast
2016E
2017E CAGR
28,280
27,730 12.2%
-2%
-2%
7.9%
7.9%

Forecast
2016E
63,988
5.2%
95%

2017E CAGR
67,500 14.9%
5.5%
100%

the outstanding supply

8-Jul-05

9-Jul-05 ######

11-Jul-05

5%
1.03%
6.24%

5%
5%
1.03% 1.03%
6.24% 6.24%

5%
1.03%
6.24%

12-Jul-05
27-Jan-00
5%
1.03%
6.24%

1,210,237
115,186

1,285,729
122,371

645,635
35,708

723,112
39,770

28,280

27,730

80%
53%
31%
90%

800,000
67,500

80%
56%
33%
90%

800,000
67,500

10%
10%
10%
10%
20%
5%

10%
10%
10%
10%
20%
5%

0%
12%

0%
12%

12%
12%
0%
-2%

11%
12%
0%
-2%

CAGR
17.1%

CAGR
12.2%

CAGR
14.9%

CAGR
3.0%

ice growth CARG 9%-10% per year (2013-2017).

a thi truong & thi phan hien tai (80%) kho co the tang them duoc.Thuong thi gia se tang cao hon lam phat mot chut, nen gia tang khoang 9

694

798

nuoc se tang 12% moi nam den 2015. tang 5% tu 2016 den 2017. Thi phan khong doi.

tinh den kha nang hap thu cua nha may: tot
2 nam (2013: 8 thang dau nam 215 trieu lit, 4 thang cuoi dat 400 tr lit, 2014: full capacity 400 trieu lit), 2015-2017: tu 400 trieu lit len 800
inh revenue: Tot. Can xem ve kha nang hap thu capacity tang them nay. Giai doan 2 cua nha may can tinh den thoi gian xay dung (2-3 nam

onomy of scale & VNM can transfer selling price

for the period 2013-2017

tang khoang 20%, bang voi toc do tang cua thi truong.
y cua nha may moi?
ong tu Thang 4/2013, moi nam tang 13k tan (bang voi cong suat hien tai). Trong 4 nam tang gap 5 lan => CAGR = 50%. Nam dau tang 33.
y tang them nay. Neu tinh tang truong nay la cua ca local & export, co the dat duoc volume nhu vay (san luong thua e xuat khau het).

ts to win market share thanks to its outstanding

dest compared to its rivals.

aturated market & stable demand for the market

trend in the past and the company's plan, in range of 30-32%.

t mot chut, nen gia tang khoang 9-10% se hop ly hon 7%

2015-2017: tu 400 trieu lit len 800 trieu lit

h den thoi gian xay dung (2-3 nam). Check lai so lieu ve capacity hien tai: 215 trieu hay 400 trieu lit?

> CAGR = 50%. Nam dau tang 33.3 (hoat dong 4 thang), nam cuoi tang 66.6% con lai.
luong thua e xuat khau het).

Vinamilk Balance Sheet

Units: VND million, except per share data
2005A
Current asset
Cash and Cash Equivalents
Short term investment (Excl bank deposits)
Provision for ST investment
Account receivables
Provision for receivables
Advance to suppliers
Inventories
Provision for Inventory deduction
ST prepayment
Other current assets
Total current assets
Long term assets
Long term investment
Provision for LT Investment
Tangible Fixed Assets
Historical price
Accum depreciation
Intangible Fixed Assets
Historical price
Accum Amortization
Financial Leased Assets
Historical price
Accum Amortization
Property Invesment
Historical price
Accum Amortization
Construction in progress
Goodwill
LT prepayment
Deferred tax assets
Other long-term assets
Total long term assets
Total assets
Current liabilities
Short term debt
Account payable
Deferred revenue
Tax payable
Accrued expenses
Bonus funds
Other current liabilities
Total current liabilities
Long term liabilties
Long term debt
Other long term liabilities
Total long term liabiltities

2006A

2007A

500,312
22,800

156,895
306,730

117,819
654,485

380,232

391,233

504,483

1,081,501

965,826

1,675,164

421,632
2,406,477

175,707
1,996,391

225,776
3,177,727

609,960

422,771

401,018

558,790
1,285,280
(726,490)
9,264
21,003
(11,739)

746,661
1,573,284
(826,623)
9,141
21,504
(12,363)

1,022,646
1,963,835
(941,189)
20,715
38,771
(18,056)

189,319

316,178

598,309

124,126
1,491,459

118,261
1,613,012

204,702
2,247,390

3,897,936

3,609,403

5,425,117

260,885

436,869

9,963
621,376

1,318,548
1,579,433

348,656
785,525

393,640
1,024,979

10,410
153,381
163,791

42,345
111,621
153,966

32,381
107,492
139,873

Total liabilities

1,743,224

939,491

1,164,852

Shareholder equity
Owner investment capital
Share capital surplus
Difference in currency
Retained earnings
Investment and development fund
Financial reserve fund
Other funds
Treasury stock
Total shareholder equity
Minority Interest

1,590,000
54,217
340,474
113,263
56,632
126
2,154,712
-

1,590,000
54,217
342,239
590,245
93,211
2,669,912
-

1,752,757
1,064,948
525,757
744,540
136,313
360
4,224,675
35,590

Total liabilities and owner equity

3,897,936

3,609,403

5,425,117

Check balance
ASSUMPTIONS
Balance Sheet
WORKING CAPITAL
Net working capital days
Account Receivable Days
Inventory Days
Account payable days
Working capital turnover
Receivable turnover
Inventory turnover
Payable turnover
Purchases
Other BS Assumptions
Cash as % Revenue
Short-term Investment as % Rev
Reserve for ST investment (% Investment)
Reserve for receivables (% Receivable)
Reserve for inventory (% Inventory)
Advance to suppliers (% Purchase)
ST prepayment (% Rev)
Other Current Assets % of Rev
Long term Investments as % Rev
Reserve for LT investment (% Investment)
Other assets as % of Rev
LT prepayment as % Rev
Deferred revenue as % Rev
Accrued expenses as % Rev
Other Current Liabilities % of COGS
Other liabilities as % COGS
Tax payable as % Rev

Cash Flow Statement

Dividend Payout Ratio

2005A

2006A

2007A

70
21.27
75
26

90
25.00
100
35

17.16
4.90
14.04
4,896,957

14.60
3.66
10.48
5,545,621

9%
0%

2%
5%

2%
10%

7%
11%

3%
6%

3%
6%

2.2%

1.8%

3.1%

30%
3.5%

7%
2.2%

8%
2.2%

2005A

2006A

2007A

Transfer to funds (% NPAT)

Investment & development Fund
Financial reserve
Bonus fund
Bonus paid-out (% of profit)

2008A

2009A

338,654
374,002

2,653,835
2,227,700

530,002

513,346

1,775,342

1,311,765

169,605
3,187,605

(1,637,488)
5,069,158

570,657

698,884
(96,405)
1,835,582
3,135,506
(1,299,924)
39,241
82,340
(43,098)

2010A

Historical
2011A

Projected
2012A

2013E

2014E

2,219,112
207,277
(70,658)
587,458
(597)
354,096
2,351,354
(4,133)
38,595
237,297
5,919,803

3,596,515
375,277
(79,244)
1,143,168
(1,918)
795,149
3,272,496
(4,934)
56,909
314,264
9,467,683

4,226,120
1,065,305
(130,029)
1,269,842
(3,853)
576,619
3,472,845
(3,455)
72,344
564,872
11,110,610

5,562,257
773,367
(173,777)
1,714,875
(3,274)
846,143
4,039,743
(5,737)
85,477
557,008
13,396,084

10,264,695
932,785
(209,598)
1,885,094
(3,599)
1,019,272
4,935,388
(7,009)
103,097
671,827
19,591,952

989,065
(142,351)
3,493,629
5,301,827
(1,808,198)
256,046
383,409
(127,363)
100,671
117,666
(16,995)
1,295,087
15,503
25,598
80,643
1,096
6,114,989

298,785
(14,356)
4,223,443
6,512,875
(2,289,432)
253,616
387,180
(133,564)
96,714
117,666
(20,952)
3,565,241
13,662
41,074
108,002
1,076
8,587,258

369,575
(17,757)
7,946,695
10,895,888
(2,949,193)
266,618
406,539
(139,921)
92,757
117,666
(24,909)
1,780,228
11,821
97,848
132,793
2,305
10,682,884

445,757
(21,418)
8,816,122
12,676,117
(3,859,994)
280,269
426,866
(146,597)
88,801
117,666
(28,866)
778,667
9,980
118,018
132,793
2,781
10,651,769

27,489
27,489
356,868

27,489
27,489
650,140

244,285
2,779,354

257,946
3,412,878

1,250,378
(108,580)
2,589,894
4,113,301
(1,523,407)
173,395
263,171
(89,776)
100,818
104,060
(3,242)
665,282
19,557
97,741
62,865
1,879
4,853,230

5,966,959

8,482,036

10,773,032

15,582,672

19,697,868

24,078,968

30,243,721

188,222
492,556

13,283
789,867

1,830,959
116,845
287,463
305,418
346,373
59,479
2,946,537

2,247,659
21,589
333,953
471,254
406,398
664,137
4,144,990

2,571,960
89,283
479,158
555,923
518,220
649,061
4,863,606

3,233,803
107,687
577,929
670,518
656,092
688,202
5,934,231

158,929
158,929

59,782
59,782

75,174
75,174

89,808
89,808

1,529,187
2,618,638
(1,089,451)
50,868
79,416
(28,548)

387,922
1,068,700

182,265
349,493
1,734,871

567,960
1,089,417
30,515
281,789
297,700
259,395
118,236
2,645,012

22,418
159,512
181,930

12,454
243,871
256,325

163,583
163,583

399,962

1,250,630

1,991,196

2,808,596

3,105,466

4,204,772

4,938,780

6,024,039

1,752,757
1,064,948
803,037
869,697
175,276
4,665,715
50,614

3,512,653
892,345
1,756,283
294,348
(154)
6,455,475
35,365

3,530,721
1,909,022
2,172,291
353,072
(669)
7,964,437
-

5,561,148
1,276,994
4,177,446
908,024
556,115
(2,522)
12,477,205
-

8,339,558
1,276,994
5,198,758
93,889
588,402
(4,504)
15,493,097
-

8,339,558
1,276,994
8,094,310
777,107
656,724
(4,504)
19,140,188
-

8,339,558
1,276,994
11,910,243
1,956,429
740,961
(4,504)
24,219,681
-

5,966,959

8,482,036

10,773,032

15,582,672

19,697,868

24,078,968

30,243,721

2008A

2009A

100
23.00
112
36

64
17.94
84
37

15.87
3.25
10.25
5,711,147

20.35
4.36
9.78
6,271,485

4%
5%

25%
21%

2%
7%

-15%
7%

3.0%

2.4%

7%
2.8%

5%
3.6%

2008A

2009A

(0)

2010A

2011A

2012A

2013E

2014E

47.2
12.8
64.6
30.1

50.3
14.6
69.8
34.1

45.7
16.6
72.3
43.2

40.6
16.6
64.0
40.0

40.6
16.6
64.0
40.0

22.0
5.7
9.1
21,989,515

22.0
5.7
9.1
26,488,794

28.62
5.65
12.12
11,390,216

24.99
5.23
10.70
15,622,646

22.02
5.05
8.45
17,236,621

14.1%
1.3%
-34.1%
-0.1%
-0.2%
3.1%
0.2%
1.5%
7.9%
-8.7%
0.0%
0.6%

16.6%
1.7%
-21.1%
-0.2%
-0.2%
5.1%
0.3%
1.5%
4.6%
-14.4%
0.0%
0.1%

15.9%
4.0%
-12.2%
-0.3%
-0.1%
3.3%
0.3%
2.1%
1.1%
-4.8%
0.0%
0.2%

5.0%
2.4%
-22.5%
-0.2%
-0.1%
3.8%
0.3%
1.7%
1.1%
-4.8%
0.0%
0.3%

5.0%
2.4%
-22.5%
-0.2%
-0.1%
3.8%
0.3%
1.7%
1.1%
-4.8%
0.0%
0.3%

0.2%
1.9%
1.1%
1.6%
1.8%

0.5%
1.4%
0.4%
1.1%
1.3%

0.1%
1.8%
1.3%
0.4%
1.3%

0.3%
1.7%
0.9%
0.4%
1.5%

0.3%
1.7%
0.9%
0.4%
1.5%

2010A

2011A

2012A
30%

2013E
30.0%

2014E
30.0%

14%
5%
10%

14%
1%
10%

10.0%
1.0%
10.0%

14.0%
1.0%
10.0%

7.8%

8.9%

8.4%

8.4%

Projected
2015E

2016E

2017E

1H 2013A

16,327,882
1,130,286
(253,977)
2,477,107
(4,729)
1,227,480
5,909,680
(8,393)
124,926
814,075
27,744,337

25,135,661
1,357,129
(304,949)
2,760,568
(5,270)
1,473,741
7,102,931
(10,087)
149,998
977,456
38,637,179

35,957,146
1,633,772
(367,111)
3,544,778
(6,767)
1,774,111
8,556,007
(12,151)
180,574
1,176,705
52,437,065

4,912,485
733,331
(142,494)
1,485,966
(5,702)
679,488
3,885,037
(3,333)
108,171
424,377
12,077,326

540,138
(25,952)
8,579,760
13,454,783
(4,875,024)
294,600
448,209
(153,609)
84,844
117,666
(32,823)
778,667
8,139
143,006
132,793
3,369
10,539,363

648,541
(31,161)
8,279,964
14,233,450
(5,953,486)
309,647
470,620
(160,973)
80,887
117,666
(36,780)
778,667
6,298
171,707
132,793
4,046
10,381,388

780,743
(37,513)
7,916,736
15,012,117
(7,095,381)
325,445
494,151
(168,706)
76,930
117,666
(40,737)
778,667
4,456
206,708
132,793
4,870
10,189,835

299,706
(14,666)
6,071,619
8,616,265
(2,544,646)
273,202
378,238
(105,036)
110,678
133,660
(22,982)
2,072,922
8,191
81,691
132,793
1,076
9,037,213

38,283,700

49,018,567

62,626,900

21,114,539

3,757,909
130,488
700,296
812,488
828,661
738,246
6,968,087

4,636,508
156,677
840,842
975,551
1,042,073
796,254
8,447,905

5,468,811
188,615
1,012,243
1,174,412
1,306,027
867,076
10,017,183

2,036,039
32,846
545,089
566,056
238,481
594,657
4,013,168

108,519
108,519

130,209
130,209

156,689
156,689

69,898
69,898

7,076,607

8,578,114

10,173,871

4,083,066

8,339,558
1,276,994
17,328,550
3,432,540
833,956
(4,504)
31,207,093
-

8,339,558
1,276,994
24,736,431
5,258,019
833,956
(4,504)
40,440,454
-

8,339,558
1,276,994
34,491,203
7,515,822
833,956
(4,504)
52,453,029
-

8,339,558
1,276,994
6,124,774
539,193
755,739
(4,785)
17,031,473
-

38,283,700

49,018,567

62,626,900

21,114,539

2015E

2016E

2017E

40.6
16.6
64.0
40.0

40.6
16.6
64.0
40.0

40.6
16.6
64.0
40.0

22.0
5.7
9.1
31,899,683

22.0
5.7
9.1
38,299,526

22.0
5.7
9.1
46,105,516

5.0%
2.4%
-22.5%
-0.2%
-0.1%
3.8%
0.3%
1.7%
1.1%
-4.8%
0.0%
0.3%

5.0%
2.4%
-22.5%
-0.2%
-0.1%
3.8%
0.3%
1.7%
1.1%
-4.8%
0.0%
0.3%

5.0%
2.4%
-22.5%
-0.2%
-0.1%
3.8%
0.3%
1.7%
1.1%
-4.8%
0.0%
0.3%

33.3%
5.0%
-19.4%
-0.4%
-0.1%
7.3%
0.7%
2.9%
2.0%
-4.9%
0.0%
0.6%

0.3%
1.7%
0.9%
0.4%
1.5%

0.3%
1.7%
0.9%
0.4%
1.5%

0.3%
1.7%
0.9%
0.4%
1.5%

0.2%
3.8%
7%
0.8%
3.7%

2015E
30.0%

2016E
30.0%

2017E
30.0%

9,297,295

14.0%
1.0%
10.0%

14.0%
1.0%
10.0%

14.0%
1.0%
10.0%

8.4%

8.4%

8.4%

Vinamilk Cash Flow Statement

Units: VND million, except per share data

IND
Historical

2011A
Profit before tax
Plus Depreciation & amortization
Minus reserve provisions
Minus Unrealized FX gain/loss
(Gain)/loss from investment activities
(Income) from interest/dividend
Gain/Loss from disposal of fixed asset
Plus interest expense
Cash Flow Before Change in Working Capital
(Inc)/Dec in A/R
(Inc)/Dec in Inventory
(Inc)/Dec in Prepaid Expenses
(Inc)/Dec in Other Current Assets
Inc/(Dec) in A/P
Inc/(Dec) in Other Current Liabilities
Change in Working Capital
Interest payment
Tax payment
Other Incomes/(Losses)
Cash Flow From Operating Activities
Cashflow from Investing Activities
Capital Expenditure
Including:
Change in Tangible Fixed Assets
Change in Intangible Fixed Assets
Change in Construction in Progress
Changes in properties investment
Income from Fixed asset disposals
Changes in ST-LT Financial Investments
Interest, dividends, shared profit from investment
Changes in other LT assets
Cash Flow from Investment Activities
Cashflow from Financing Activities
Issuance of new shares
Stock Buyback
Increase / (Pay-off) of ST loans
Increase / (Pay-off) of LT loans
Dividend payment
Changes in other LT liabilities

4,978,992
440,576
44,479

2012A
6,929,668
535,452
(76,755)

8,814
(492,527)
22,449
13,933

(21,317)
(362,908)
20,674
3,115

5,016,716
(555,711)
(921,141)
53,829
(518,020)
741,542
40,965
(1,158,536)
(13,933)
(760,810)
-

7,027,929
(126,673)
(200,350)
(30,910)
(32,078)
416,700
657,504
684,193
(3,115)
(1,045,989)
-

3,083,436

6,663,018

(2,137,685)

(3,587,957)

(243,324)
(120,335)
(1,760,420)
(13,607)
58,616
93,314
483,713
(12,942)

(351,599)
(5,042)
(3,231,317)
38,250
253
384,225
(25,497)

(1,514,984)

(3,190,727)

1,454,528
(1,853)
(567,960)
(741,428)
(4,654)

(1,982)
(2,222,994)
(99,148)

Other distribution from equity

Cash Flow from Financing Activities

(329,683)

(518,562)

(191,049)

(2,842,686)

NET CASH FLOW IN YEAR

1,377,403

629,605

Cash - Beginning
Cash - Ending
Cash on Balance Sheet
Difference

2,219,112
3,596,515
3,596,515
(0)

3,596,515
4,226,120
4,226,120
(0)

Doanh thu
Financial
Ti chnh
income
Li cho vay
Loan interest
Li tin gi
Deposit interest
Li u tBond
tri phiu
coupon
C tc nhn
Dividends
c received
Li FX Realized
thc hin
FX gain
Li do nh
Unrealized
gi li FX
FX gain
Thanh l Disposal
ti khonof
u
investment
t
Thu nhpOther
ti chnh
financial
khc incomes

680,232
2,445
366,516
97,989
25,577
133,012
53,335
1,359

475,239
469
249,763
77,057
35,620
103,439
8,791
101

Chi ph tiFinancial
chnh Expense
H tr thanh
Support
tonfor payment
Chi ph liInterest
vay expense
Chi ph liInterest
cho ccexpense
khon k
forqu
margin services
L FX Realized
thc hinFX loss
L do nh
Unrealized
gi li FXFX loss
(hon nhp
Provision/(reversal
d phng)/D phng
of provision)
gim gi
Chi ph Ti
Other
chnh
financial
khc expenses

246,430
22,668
13,933
1,174
105,298
60,941
42,357
59

51,171
31,602
3,115
1,016
37,855
23,750
(77,210)
31,043

CF Working

Lai/(lo) trong
Profit/(loss)
cong ty in
lien
associates
doanh lien ket

(8,814)

12,526

INDIRECT METHOD
Projected

2013E
8,135,593
670,075
48,852

2014E
10,030,782
921,434
41,079

2015E
12,555,120
1,025,998
51,427

2016E

2017E

15,526,700
1,089,783
58,416

19,203,835
1,153,585
72,075

(86,039)
(293,651)
-

(86,535)
(474,809)
-

(104,637)
(797,777)
-

(126,160)
(1,243,906)
-

(151,696)
(1,832,784)
-

8,474,831
(445,034)
(566,898)
(69,908)
(261,660)
324,301
282,492
(736,706)
(1,303,417)
-

10,431,951
(170,218)
(895,645)
(37,790)
(287,948)
661,842
270,911
(458,848)
(1,607,048)
-

12,730,130
(592,013)
(974,292)
(46,817)
(350,455)
524,106
337,182
(1,102,290)
(2,011,476)
-

15,304,833
(283,461)
(1,193,251)
(53,773)
(409,643)
878,599
387,806
(673,723)
(2,487,558)
-

18,445,015
(784,210)
(1,453,076)
(65,578)
(499,619)
832,303
473,021
(1,497,158)
(3,076,677)
-

6,434,708

8,366,056

9,616,364

12,143,552

13,871,179

(2,617,359)

(798,994)

(800,010)

(801,077)

(802,198)

(19,359)
(2,598,000)
221,147

(20,327)
(778,667)
(235,599)

(21,343)
(778,667)
(291,882)

(22,410)
(778,667)
(335,247)

(23,531)
(778,667)
(408,845)

379,690

561,343

902,415

1,370,066

1,984,480

1,366

1,252

1,165

1,016

234,907

774,454

(24,179)
(2,040,700)

(471,884)

(188,225)

(2,501,867)
15,392

(2,501,867)
14,635

(2,501,867)
18,711

(2,501,867)
21,689

(2,501,867)
26,480

(571,395)

(704,502)

(881,796)

(1,090,502)

(1,348,762)

(3,057,870)

(3,191,734)

(3,364,952)

(3,570,680)

(3,824,149)

1,336,137

4,702,438

6,063,187

8,807,780

10,821,485

4,226,120
5,562,257
5,562,257
0

5,562,257
10,264,695
10,264,695
-

10,264,695
16,327,882
16,327,882
-

16,327,882
25,135,661
25,135,661
-

25,135,661
35,957,146
35,957,146
-

Vinamilk Financial Ratios

Units: VND million, except per share data

Historical
2011A

2012A

2013F

Projected
2014F
2015F

2016F

2017F

37.3%
42.0%
28.2%
27.0%
13.9%
29.0%
43.2%
30.1%
17.1%
16.6%
12.9%

22.8%
15.9%
37.5%
29.9%
13.9%
43.8%
28.9%
42.5%
39.2%
38.0%
38.0%

23.7%
25.7%
20.0%
23.7%
23.7%
17.9%
25.4%
18.5%
17.4%
17.4%
17.4%

20.6%
19.5%
22.8%
20.6%
20.6%
22.4%
37.5%
23.7%
23.3%
23.3%
23.3%

21.2%
20.8%
21.8%
21.2%
21.2%
23.2%
11.3%
22.1%
25.2%
25.2%
25.2%

20.1%
20.0%
20.2%
20.1%
20.1%
21.6%
6.2%
20.3%
23.7%
23.7%
23.7%

20.4%
20.3%
20.5%
20.4%
20.4%
21.7%
5.9%
20.5%
23.7%
23.7%
23.7%

34.3%
21.2%
23.1%
27.0%
23.0%
37.6%
50.2%
35.9%

32.0%
20.0%
21.9%
23.0%
19.5%
32.0%
41.3%
28.6%

35.9%
23.4%
25.4%
26.1%
21.9%
33.0%
41.6%
31.5%

34.8%
22.3%
24.3%
24.8%
20.8%
31.2%
39.5%
30.0%

35.4%
22.6%
24.9%
25.3%
21.3%
31.0%
38.9%
29.2%

35.6%
23.0%
25.1%
26.1%
22.0%
30.8%
38.0%
28.4%

35.6%
23.3%
25.2%
26.9%
22.6%
29.9%
36.4%
27.1%

35.7%
23.5%
25.2%
27.7%
23.2%
28.9%
34.7%
25.8%

0.07
0.05
0.74

0.00
0.00
0.80

0.00
0.00
0.79

0.00
0.00
0.79

0.00
0.00
0.80

0.00
0.00
0.82

0.00
0.00
0.83

0.00
0.00
0.84

2010A
Growth Rates (%)
Sales
COGS
Gross profit
Selling expenses
Administration expenses
EBITDA
Depreciation and Amortization
EBIT / Operating profit
EBT
NPAT
EPS
Profitability
Gross profit margin
EBITDA margin
EBIT margin / Operating profit margin
EBT margin
NPAT margin
Return on Assets (ROA)
Return on Equity (ROE)
ROIC
Financial leverage
Debt Equity Ratio
Debt to Total Asset ratio
Equity Multiplier

48.4%
53.7%
39.3%
12.9%
22.4%

55.4%
55.6%
52.2%

Liquidity
Quick Ratio
Current Ratio

1.35
2.24

2.10
3.21

1.84
2.68

1.92
2.75

2.47
3.30

3.13
3.98

3.73
4.57

4.38
5.23

Coverage ratios
Interest coverage (EBITDA/interest)
CFO/Current liabilities
CFO/Interest bearing debt

542
0.8
3.6

310
0.8

1,992
1.3
No debt

#DIV/0!
1.3
No debt

#DIV/0!
1.4
No debt

#DIV/0!
1.4
No debt

#DIV/0!
1.4
No debt

#DIV/0!
1.4
No debt

Efficiency
Receivable Turnover
Days Receivable Outstanding
Inventory Turnover
Days Inventory Outstanding
Payables Turnover
Days Payable Outstanding
Business Cycle
Current Asset Turnover
Fixed Asset Turnover
Asset Turnover

28.6
13
5.7
65
12.1
30
47
2.9
13.6
1.6

25.0
15
5.2
70
10.7
34
50
2.8
13.3
1.6

22.0
17
5.1
72
8.5
43
46
2.6
12.9
1.5

22.0
17
5.7
64
9.1
40
41
2.7
10.4
1.5

22.0
17
5.7
64
9.1
40
41
2.4
9.2
1.5

22.0
17
5.7
64
9.1
40
41
2.0
10.7
1.4

22.0
17
5.7
64
9.1
40
41
1.7
13.2
1.3

22.0
17
5.7
64
9.1
40
41
1.5
16.5
1.2

Purchasing

No debt

17,236,621

Vinamilk Shareholder Equity

Units: VND million, except per share data
SHAREHOLDER EQUITY
Owner investment capital
Share capital surplus
Difference in currency
Retained earnings
Investment and development fund
Financial reserve fund
Other funds
Treasury stock
Total shareholder equity
Retained Earnings
Beginning balance
Profit for the year
Transfer to funds
Investment & Development fund (10%)
Financial Reserve (Max (5%, 10% chartered))
Bonus funds
Dividend payment
Increase charter capital
Others
Ending balance

Historical
2011A
5,561,148
1,276,994
4,177,446
908,024
556,115
(2,522)
12,477,205

2012A
8,339,558
1,276,994
5,198,758
93,889
588,402
(4,504)
15,493,097

2011A
1,909,022
4,218,182
(1,208,329)
(588,625)
(203,043)
(416,660)
(741,428)
-

2012A
4,177,446
5,819,455
(1,425,622)
(814,748)
(32,287)
(578,587)
(2,222,994)
(1,149,527)

4,177,446

5,198,758

Detailed Calculation
Share Capital
Beginning balance
New capital
Bonus/Right issue
Ending balance

3,530,721
177,534
1,852,892
5,561,148

5,561,148

Share premium
Beginning balance
Increase
Decrease
Ending balance

1,276,994
1,276,994

1,276,994
1,276,994

Treasury stock
Beginning balance
Increase
Decrease
Ending balance
Investment & development Fund (10% NPAT)
Beginning balance
Increase
Decrease
Ending balance
Financial reserve (Max (5%, 10% chartered))
Beginning balance
Increase
Decrease

2011A

2012A

2,778,410
8,339,558

(669)
(1,853)
(2,522)

(2,522)
(1,982)
(4,504)

14.0%
2,172,291
588,625
(1,852,892)
908,024

14%
908,024
814,748
(1,628,883)
93,889

4.8%
353,072
203,043

1%
556,115
32,287

Ending balance
Non-equity funds
Bonus fund (10% NPAT)
Beginning balance
Increase
Decrease
Ending balance

556,115

588,402

9.9%
259,395
416,660
(329,683)
346,373

10%
346,373
578,587
(518,562)
406,398

(329,683)

(518,562)

2013E
8,339,558
1,276,994
8,094,310
777,107
656,724
(4,504)
19,140,188

2014E
8,339,558
1,276,994
11,910,243
1,956,429
740,961
(4,504)
24,219,681

Projected
2015E
8,339,558
1,276,994
17,328,550
3,432,540
833,956
(4,504)
31,207,093

2016E
8,339,558
1,276,994
24,736,431
5,258,019
833,956
(4,504)
40,440,454

2017E
8,339,558
1,276,994
34,491,203
7,515,822
833,956
(4,504)
52,453,029

2013E
5,198,758
6,832,177
(1,434,757)
(683,218)
(68,322)
(683,218)
(2,501,867)

2014E
8,094,310
8,423,734
(2,105,933)
(1,179,323)
(84,237)
(842,373)
(2,501,867)

2015E
11,910,243
10,543,644
(2,623,469)
(1,476,110)
(92,995)
(1,054,364)
(2,501,867)

2016E
17,328,550
13,039,142
(3,129,394)
(1,825,480)
(1,303,914)
(2,501,867)

2017E
24,736,431
16,127,158
(3,870,518)
(2,257,802)
(1,612,716)
(2,501,867)

8,094,310

11,910,243

17,328,550

24,736,431

34,491,203

2013E

2014E

2015E

2016E

2017E

8,339,558

8,339,558

8,339,558

8,339,558

8,339,558

8,339,558

8,339,558

8,339,558

8,339,558

8,339,558

1,276,994
1,276,994

1,276,994
1,276,994

1,276,994
1,276,994

1,276,994
1,276,994

1,276,994
1,276,994

(4,504)

(4,504)

(4,504)

(4,504)

(4,504)

(4,504)

(4,504)

(4,504)

(4,504)

(4,504)

93,889
683,218

777,107
1,179,323

1,956,429
1,476,110

3,432,540
1,825,480

5,258,019
2,257,802

777,107

1,956,429

3,432,540

5,258,019

7,515,822

588,402
68,322

656,724
84,237

740,961
92,995

833,956
-

833,956
-

656,724

740,961

833,956

406,398
683,218
(571,395)
518,220

518,220
842,373
(704,502)
656,092

656,092
1,054,364
(881,796)
828,661

833,956

828,661
1,303,914
(1,090,502)
1,042,073

833,956

1,042,073
1,612,716
(1,348,762)
1,306,027

Vinamilk Fixed Assets

Units: VND million, except per share data
FIXED ASSETS
Tangible Fixed Assets
Historical price
Accum depreciation
Intangible Fixed Assets
Historical price
Accum Amortization
Investment Properties
Historical price
Accum Amortization
Net Depreciation for Tangible
Depreciation rate
Depreciation period
Net Amortization in year
Amortization rate
Amortization period
Net Depreciation for Investment Properties
Depreciation rate
Depreciation period
Total Depreciation & Amortization
D&A / Sales
D&A / COGS

2010A
2,589,894
4,113,301
(1,523,407)
173,395
263,171
(89,776)
100,818
104,060
(3,242)

Historical
2011A
3,493,629
5,301,827
(1,808,198)
256,046
383,409
(127,363)
100,671
117,666
(16,995)

2012A
4,223,443
6,512,875
(2,289,432)
253,616
387,180
(133,564)
96,714
117,666
(20,952)

2013E
7,946,695
10,895,888
(2,949,193)
266,618
406,539
(139,921)
92,757
117,666
(24,909)

223,482
6.17%
16.22

284,792
6.05%
16.53

481,234
8.15%
12.28

659,761
7.58%
13.19

46,678
27.02%
3.70

37,587
11.63%
8.60

6,201
1.61%
62.13

6,357
4.03%
24.8

3,242
4.93%
20.29

13,753
12.41%
8.06

3,957
3.36%
29.74

3,957
5.16%
19.4

273,402
1.74%
2.64%

336,132
1.55%
2.29%

491,392
1.85%
2.88%

670,075
2.04%
3.13%

3,135,506
196,359
1,146,041
(433,270)
68,664
4,113,301

4,113,301
155,719
1,130,615
(185,412)
87,604
5,301,827

5,301,827
278,771
961,162
(101,713)
72,828
6,512,875

82,340
33,271

263,171
9,139

383,409
5,042

387,180
19,359

147,560
263,171

(97)
111,196
383,409

(1,271)
0
387,180

406,539

27,489

104,060

117,666

117,666

COSTS
Tangible fixed assets
Beginning
Purchased in year
Transferred from CIP
Sold in year
Other adjustment
Ending
Intangible assets
Beginning
Purchased in year
Transferred from CIP
Sold in year
Other adjustment
Ending
Investment Properties
Beginning
Purchased in year
Transferred from CIP
Sold in year
Other adjustment
Ending

12,411
64,159
104,060

13,607
117,666

6,512,875
4,383,013

10,895,888

117,666

117,666

Depreciation
Tangible fixed assets
Beginning
Increased in year
Sold in year
Other adjustment
Ending
Intangible assets
Beginning
Increased in year
Sold in year
Other adjustment
Ending
Investment Properties
Beginning
Increased in year
Sold in year
Other adjustment
Ending

1,299,924
276,712
(84,079)
30,849
1,523,407

43,098
10,600
36,078
89,776

1,523,407
399,310
(104,347)
(10,172)
1,808,198

1,808,198
524,023
(42,790)
(0)
2,289,432

2,289,432
659,761

89,776
11,442
(97)
26,242
127,363

127,363
7,472
(1,271)
(0)
133,564

133,564
6,357

2,949,193

139,921

2,818

3,242
3,838

16,995
3,957

20,952
3,957

424
3,242

9,915
16,995

20,952

24,909

2,864,107
2,589,894
173,395
100,818
349,191

3,850,346
3,493,629
256,046
100,671
81,065

4,573,774
4,223,443
253,616
96,714
58,924

8,306,070
7,946,695
266,618
92,757
-

650,140
1,175,733
(1,146,041)
(12,411)
(1,495)
(643)
665,282

665,282
1,765,978
(1,130,615)
(4,529)
(1,030)
1,295,087

1,295,087
3,244,216
(961,162)

(3,329,013)
3,565,241
2,598,000
(4,383,013)

(12,899)
3,565,241

1,780,228

4-Jul-05
1,268,000
869,000
158,000
51,000
479,000
189,000
19,000
3,033,000

5-Jul-05
654,000
400,000
14,000
201,000
554,000
473,000
302,000
2,598,000

Net book value

Remaining assets
Tangible fixed assets
Intangible assets
Investment Properties
Sold assets
CONSTRUCTION IN PROGRESS
Beginning balance
Increase in year
Transfer to fixed assets
Transfer to investment properties
Transfer to inventory
Sold in year
Other changes
Ending balance

2013-2017 PROJECTION
CAPEX PLAN
Vietnam Milk Factory
Dielac II Factory
Da Nang Factory
Warehouses
Supply Chain
Cow Herding
Others
Total New Capex
Total Tangible assets
Reinvestment rate (% of sales)
Depreciation of Tangible Assets

Before 2012
415,000
569,000
204,000
75,000
1,225,000
36,000
47,000
2,571,000

0%

5,301,827
16%

6,512,875
14%

10,895,888
10%

Old assets
New assets in 2013
New assets in 2014
New assets in 2015
New assets in 2016
New assets in 2017
Total Depreciation
Amortization of Intangible Assets
Old assets
New assets in 2013
New assets in 2014
New assets in 2015
New assets in 2016
New assets in 2017
Total Amortization
Assumption
Depreciation period of new assets (year)
Tangible
Intangible
Depreciation period of first year (months)
Tangible
Intangible
Increase in fixed assets (% old assets)
Intangible

284,792

481,234

481,234
178,528

284,792

481,234

659,761

6,201
156

6,357

12.28
62.13
6
6
5.00%

2014E
8,816,122
12,676,117
(3,859,994)
280,269
426,866
(146,597)
88,801
117,666
(28,866)

Projected
2015E
8,579,760
13,454,783
(4,875,024)
294,600
448,209
(153,609)
84,844
117,666
(32,823)

2016E
8,279,964
14,233,450
(5,953,486)
309,647
470,620
(160,973)
80,887
117,666
(36,780)

2017E
7,916,736
15,012,117
(7,095,381)
325,445
494,151
(168,706)
76,930
117,666
(40,737)

910,801
7.73%
12.94

1,015,029
7.77%
12.87

1,078,462
7.79%
12.84

1,141,895
7.81%
12.81

6,676
4.03%
24.8

7,012
4.03%
24.8

7,364
4.03%
24.8

7,733
4.03%
24.8

3,957
5.16%
19.4

3,957
5.16%
19.4

3,957
5.16%
19.4

3,957
5.16%
19.4

921,434
2.33%
3.60%

1,025,998
2.14%
3.32%

1,089,783
1.89%
2.94%

1,153,585
1.66%
2.58%

10,895,888

12,676,117

13,454,783

14,233,450

1,780,228

778,667

778,667

778,667

12,676,117

13,454,783

14,233,450

15,012,117

406,539
20,327

426,866
21,343

448,209
22,410

470,620
23,531

426,866

448,209

470,620

494,151

117,666

117,666

117,666

117,666

117,666

117,666

117,666

117,666

Ending Balance = Beginning balance +

2,949,193
910,801

3,859,994
1,015,029

4,875,024
1,078,462

5,953,486
1,141,895

3,859,994

4,875,024

5,953,486

7,095,381

139,921
6,676

146,597
7,012

153,609
7,364

160,973
7,733

146,597

153,609

160,973

168,706

24,909
3,957

28,866
3,957

32,823
3,957

36,780
3,957

28,866

32,823

36,780

40,737

9,185,192
8,816,122
280,269
88,801
-

8,959,204
8,579,760
294,600
84,844
-

8,670,498
8,279,964
309,647
80,887
-

8,319,110
7,916,736
325,445
76,930
-

1,780,228
778,667
(1,780,228)

778,667
778,667
(778,667)

778,667
778,667
(778,667)

778,667
778,667
(778,667)

778,667

778,667

778,667

778,667

6-Jul-05

7-Jul-05

8-Jul-05

9-Jul-05

778,667

778,667

778,667

778,667

12,676,117
2%

13,454,783
2%

14,233,450
2%

15,012,117
1%

Capex Plan 2014-2016 (Unit: VND mn

12,000
68,000
43,000
294,000
538,000
1,082,000
299,000
2,336,000

Note:

481,234
357,056
72,512

481,234
357,056
145,024
31,716

481,234
357,056
145,024
63,433
31,716

910,801

1,015,029

1,078,462

6,201
312
164

6,201
312
327
172

6,201
312
327
344
180

6,676

7,012

7,364

6,201
312
327
344
361
189
7,733

6
6

6
6

6
6

6
6

5.00%

5.00%

5.00%

481,234
357,056
145,024
63,433
63,433
31,716
1,141,895

5.00%

2,406,167.82
1,606,750.34
507,582.81
158,582.30
95,149.38
31,716.46

- Historical price of Tangible

- Assume new assets only b

nce = Beginning balance + Construction in Progress.

2014-2016 (Unit: VND mn)

Historical price of Tangible Fixed Assets at the ending of year 1 = Historical price of Tangible Fixed Assets at the end of year 0 + Constructi
Assume new assets only brought into operation since the beginning of next year

s at the end of year 0 + Construction in Progress of year 0

WACC Analysis - Vinamilk

Discount Rate Calculation - Assumptions
Risk-Free Rate:
Equity Risk Premium:
Interest Rate on Debt:

8.50%
11.57%
10.00%

Comparable Companies - Unlevered Beta Calculation

Levered
Name
Beta
Mengniu Dairy
0.54
Inner Mongolia Yili
0.88
Bright Dairy
0.94
Yashili
0.84
Modern Farm
0.66
Meiji Dairies Corp
0.68
Median

0.76

Vinamilk

0.78

Vinamilk - Levered Beta & WACC Calculation

Unlevered
Beta
Vinamilk
Cost of Equity Based on Comparables:
Cost of Equity Based on Historical Beta:
WACC
Based on comparables
Based on Historical beta

0.68

Debt
130
422
270
54
423
2,076

Equity
Value
7,650
8,965
2,877
1,661
1,682
4,044

Equity
Value

Debt
-

115,919,856

Tax Rate
14.7%
16.8%
20.1%
27.2%
0.0%
33.2%

Unlevered
Beta
0.53 Unlevered beta = Levered beta / (1+(1-t)*D/E)
0.85
0.88
0.82
0.53
0.51
0.68

Tax Rate
16%

Levered
Beta
0.68
16.33%
17.47%

16.33%
17.47%

Vinamilk DCF Calculation

FCFF Projection
Valuation date:
Last fiscal year end date
Year fraction

9/13/2013
12/31/2012
30%

VNDm
EBIT
Tax Paid
EBIAT

2011A
4,992,925
762,939
4,229,986

Add back:
Depreciation & Amortization Expense

414,590

Minus:
Change in Net Working Capital
Capital Expenditure
Free Cash Flow to Firm (FCFF)
FCFF growth
WACC
Discount Period
Discount Factor
Midyear adjustment factor
Present Value of FCFF

1,158,536
2,137,685
1,348,355
16.33%

Enterprise Value (VND mn)

Cumulative Present Value of FCFF

71,076,988

Terminal Value (by EV/EBITDA)

Terminal EBITDA (2022E)
Exit Multiple
Terminal Value
Discount Factor
Present Value of Terminal Value
% of Enterprise Value

28,146,240
6.0x
168,877,440
0.25
41,380,765
36.80%

Enterprise Value

112,457,753

WACC

Enterprise Value
E
112,457,753
14.33%
15.33%
16.33%
17.33%
18.33%

5.0x
117,335,596
111,225,975
105,560,959
100,302,825
95,417,416

Equity Value (V
E

WACC

14.33%

5.0x
122,248,081

WACC

15.33%
16.33%
17.33%
18.33%

116,138,460
110,473,444
105,215,310
100,329,901

WACC

Price per Shar

E
140,739
14.33%
15.33%
16.33%
17.33%
18.33%

5.0x
146,588
139,262
132,469
126,164
120,306

WACC

Implied Perpetuity G
E
1.8%
14.33%
15.33%
16.33%
17.33%
18.33%

5.0x
-2.4%
-1.6%
-0.7%
0.2%
1.0%

WACC

PV of Terminal Value as %
E
37%
14.33%
15.33%
16.33%
17.33%
18.33%

5.5x
36.7%
35.8%
34.8%
33.8%
32.9%

FCFE Projection

Minus:
Add:

VNDm
Free Cash Flow to Firm (FCFF)
After-tax Interest Expense
Net Debt Borrowing
Free Cash Flow to Equity (FCFE)
FCFE growth
Cost of Equity
Discount Period
Discount Factor
Midyear adjustment factor
Present Value of FCFE

2011A
1,348,355
11,804
(567,960)
768,590
16.33%

Equity Value (VND mn)

Cumulative Present Value of FCFE

71,076,988

FCFE Terminal Value (by growth rate)

Terminal Net income (2022E)
Growth rate
Terminal Value
Discount Factor
PV of Terminal Value
As of % of Equity Value

25,972,949
1.8%
181,793,120
25%
44,545,550
38.53%

Equity Value

115,622,538

Equity Value (V
Implied Pe

Cost of Equity

115,622,538
14.33%

-0.2%
128,129,402

15.33%

118,135,507

16.33%

109,467,403

17.33%

101,889,371

18.33%

95,217,358

Cost of Equity

Price per Shar

Implied Pe

By other method
FCFE
Net income
Depreciation
Less Capex
Less change in WC
Add debt
Total FCFE
FCFE by old method

138,643
14.33%

-0.2%
153,641

15.33%

141,657

16.33%

131,263

17.33%

122,176

18.33%

114,176

4,218,182
414,590
(2,137,685)
(1,158,536)
(567,960)
768,590

2012A
6,932,783
1,110,712
5,822,071

17%
2013E
8,135,593
1,303,417
6,832,177

534,303

670,075

(684,193)
3,587,957
3,452,609

23%
2014E
10,030,782
1,607,048
8,423,734

25%
2015E
12,555,120
2,011,476
10,543,644

24%
2016E
15,526,700
2,487,558
13,039,142

921,434

1,025,998

1,089,783

736,706
2,617,359
4,148,187
20%

458,848
798,994
8,087,327
95%

1,102,290
800,010
9,667,342
20%

673,723
801,077
12,654,125
31%

0.96
1.02
4,055,558
20%

1.0
0.82
1.08
7,167,168
95%

2.0
0.71
1.08
7,364,877
20%

3.0
0.61
1.08
8,287,172
31%

Implied Equity Value and Share Price

(VND mn, except per share)
Enterprise Value
112,457,753
Less: Total Debt
Plus: Cash and Cash Equivalents
4,912,485

FCFF Terminal Value (2022E)

WACC
Terminal Value

Implied Equity Value

Implied Perpetuity Growth Rate

Price per Share

Forward P/E 2013E

Implied Perpetuity Growth Rate

117,370,238

VND 140,739
17.2x

Enterprise Value (VND mn)

Exit Multiple
5.5x
6.0x
121,387,427
125,439,258
114,962,625
118,699,276
109,009,356
112,457,753
103,487,392
106,671,960
98,360,327
101,303,237

6.5x
129,491,089
122,435,927
115,906,150
109,856,527
104,246,148

7.0x
133,542,921
126,172,577
119,354,547
113,041,095
107,189,058

Equity Value (VND mn)

Exit Multiple
5.5x
6.0x
126,299,912
130,351,743

6.5x
134,403,575

7.0x
138,455,406

119,875,111
113,921,841
108,399,877
103,272,812

123,611,761
117,370,238
111,584,445
106,215,722

127,348,412
120,818,635
114,769,013
109,158,633

131,085,063
124,267,032
117,953,580
112,101,543

Price per Share (VND)

Exit Multiple
5.5x
6.0x
151,447
156,305
143,743
148,223
136,604
140,739
129,983
133,801
123,835
127,364

6.5x
161,164
152,704
144,874
137,620
130,893

7.0x
166,022
157,185
149,009
141,439
134,421

Implied Perpetuity Growth Rate

Exit Multiple
5.5x
6.0x
-1.1%
0.0%
-0.2%
0.9%
0.6%
1.8%
1.5%
2.7%
2.4%
3.5%

6.5x
1.0%
1.9%
2.8%
3.7%
4.5%

7.0x
1.9%
2.7%
3.6%
4.5%
5.4%

PV of Terminal Value as % of Enterprise Value

Exit Multiple
6.0x
6.5x
38.8%
40.7%
37.8%
39.7%
36.8%
38.7%
35.8%
37.7%
34.9%
36.7%

7.0x
42.5%
41.5%
40.4%
39.4%
38.4%

7.5x
44.2%
43.1%
42.1%
41.1%
40.1%

2012A
3,452,609
2,616
3,449,993

2013E
4,148,187
4,148,187

2014E
8,087,327
8,087,327

2015E
9,667,342
9,667,342

2016E
12,654,125
12,654,125

0.96
1.02
4,055,558

1.0
0.82
1.08
7,167,168

2.0
0.71
1.08
7,364,877

3.0
0.61
1.08
8,287,172

Implied Equity Value and Share Price

(VND mn, except per share)
Equity Value
115,622,538
Less: Cash & Cash Equivalents
4,912,485

Implied Terminal Multiple

FCFE Terminal value (2022E)

Plus: Debt
Implied Enterprise Value

120,535,023

Implied Price per Share

VND 138,643

Net income 2022E

Implied P/E

Forward P/E 2013E

16.9x

Equity Value (VND m)

Implied Perpetuity Growth Rate
0.8%
132,470,643

1.8%
137,504,145

2.8%
143,409,835

3.8%
150,435,914

121,654,384

125,692,950

130,375,512

135,869,453

112,346,957

115,622,538

119,381,877

123,740,685

104,265,688

106,947,794

109,998,771

113,500,335

97,193,185

99,407,895

101,907,598

104,751,086

Price per Share (VND)

Implied Perpetuity Growth Rate
0.8%
1.8%
2.8%
158,846
164,882
171,963

3.8%
180,388

145,876

150,719

156,334

162,922

134,716

138,643

143,151

148,378

125,025

128,242

131,900

136,099

116,545

119,200

122,198

125,607

5,819,455
534,303
(3,587,957)
684,193
3,449,993
(2,616)

6,832,177
670,075
(2,617,359)
(736,706)
4,148,187
-

8,423,734
921,434
(798,994)
(458,848)
8,087,327
-

10,543,644
1,025,998
(800,010)
(1,102,290)
9,667,342

13,039,142
1,089,783
(801,077)
(673,723)
12,654,125

24%
2017E
19,203,835
3,076,677
16,127,158

2018E

2019E

2020E

2021E

16,479,526
10%

18,127,478
10%

19,940,226
10%

21,934,249
10%

5.0
0.45
1.08
7,975,364

6.0
0.39
1.08
7,541,522

7.0
0.33
1.08
7,131,280

8.0
0.29
1.08
6,743,354

1,153,585
1,497,158
802,198
14,981,387
18%
34%
4.0
0.52
1.08
8,434,164
18%

Implied Perpetuity Growth Rate

Terminal Value (2022E)

d Perpetuity Growth Rate

24,127,674
16.33%
168,877,440
1.8%

Formula for terminal value based on growth rate

TermVal=FCFF*(1+g)/(r-g)
g= ( (TermVal/FCFF)*r-1)/ (1+TermVal/FCFF)
g= (TV*r - FCFF) / (FCFF+TV)

2017E
14,981,387
14,981,387
34%

2018E

2019E

2020E

2021E

16,479,526
10%

18,127,478
10%

19,940,226
10%

21,934,249
10%

4.0
0.52
1.08
8,434,164

5.0
0.45
1.08
7,975,364

6.0
0.39
1.08
7,541,522

7.0
0.33
1.08
7,131,280

8.0
0.29
1.08
6,743,354

Implied Terminal Multiple

Terminal value (2022E)

181,793,120

25,972,949
7.x

16,127,158
1,153,585
(802,198)
(1,497,158)
14,981,387

ed on growth rate

TermVal/FCFF)

2022E

24,127,674
10%
9.0
0.25
1.08
6,376,530

ASSUMPTIONS
- Stage 1 - 2013-2017 CAGR FCF: 30%
- Stage 2 - 2018-2022 CAGR FCF: 10 %

2022E

24,127,674
10%
9.0
0.25
1.08
6,376,530

Vinamilk
Benchmarking Analysis - Financial Statistics and Ratios
(USD millions, except USD per share data)

Company
Mengniu Dairy
Inner Mongolia Yili
Bright Dairy
Yashili
Modern Farm
Meiji Dairies Corp

Ticker
2319 HK equity
600887 CH equity
600597 CH equity
1230 HK equity
1117 HK equity
2269 JP equity

Vinamilk

VNM VN equity

Company
Mengniu Dairy
Inner Mongolia Yili
Bright Dairy
Yashili
Modern Farm
Meiji Dairies Corp

Ticker
2319 HK equity
600887 CH equity
600597 CH equity
1230 HK equity
1117 HK equity
2269 JP equity

Vinamilk

VNM VN equity

Market Valuation
As of 13 Sep 2013
Equity
Enterprise
Shares
Value ($mn) Value ($mn) Outstanding (mn)
7,650
7,393
1,768
8,965
9,091
1,717
2,877
2,832
1,108
1,661
1,328
3,557
1,682
2,010
4,849
4,044
6,023
74
5,392

5,163

General Information
As of 13 Sep 2013
Shares
Price
Outstanding
($)
(million)
4.33
1,768
5.22
1,717
2.60
1,108
0.47
3,557
0.35
4,849
54.90
74
6.47

834

834

Beta
0.54
0.88
0.94
0.84
0.66
0.68
0.78

LTM Financial Statistics ($mn, except EPS - $)

Sales
5,897
6,863
2,251
597
274
11,307

Gross
Profit
1,646
2,040
831
334
66
4,252

EBITDA
370
418
128
100
54
671

1,322

510

331

Return on Investment

LTM Profitability Margins

204
269
75
86
38
260

Net
Income
206
281
51
77
65
167

359

296

EBIT

EPS
0.12
0.16
0.05
0.02
0.01
2.27

Gross
Profit
(%)
27.9%
29.7%
36.9%
55.9%
24.0%
37.6%

EBITDA
(%)
6.3%
6.1%
5.7%
16.7%
19.7%
5.9%

0.35

38.6%

25.0%

LTM Coverage Ratios

EBITDA/
EBITDA
EBIT/

Leverage Ratios
Debt/
Tot. Cap.

ROE

ROA

Int. Exp.

(%)
10.1%
23.4%
7.8%
11.5%
7.9%
5.3%

(%)
6.0%
8.8%
3.4%
8.5%
4.6%
2.1%

(x)

41.6%

41.3%

54.23
n.m
10.96
217.54
4.63
43.13
1,992

- Cpx/Int. Int. Exp.

(x)
7.28
n.m
(4.31)
143.30
(26.94)
20.35
840

(x)
29.88
n.m
6.44
188.36
3.28
16.69

(%)
1.7%
4.7%
9.4%
3.3%
25.2%
51.3%

2,164

0.0%

LTM Profitability Margins

EBIT
(%)
3.5%
3.9%
3.3%
14.4%
14.0%
2.3%

Net
Income
(%)
3.5%
4.1%
2.3%
12.8%
23.8%
1.5%

Sales
Hist.
Est.
1-year
1-year
-3.5%
16.2%
12.1%
12.1%
16.9%
19.4%
23.6%
22.3%
50.7%
70.8%
1.6%
1.0%

Growth Rate
EBITDA
Hist.
Est.
1-year
1-year
-8.4%
18.2%
17.8%
47.5%
44.8%
24.6%
68.4%
23.5%
28.3%
64.0%
9.0%
9.0%

27.2%

22.4%

22.8%

43.8%

23.7%

17.9%

EPS
Hist.
Est.
1-year
1-year
-21.3%
12.3%
-5.7%
15.1%
24.0%
23.0%
53.3%
20.3%
59.5%
10.1%
144.6%
27.3%
38.0%

17.4%

Vinamilk
Comparable Companies Analysis
(VND millions, except per share data)

Company

Ticker

Mengniu Dairy
Inner Mongolia Yili
Bright Dairy
Yashili
Modern Farm
Meiji Dairies Corp

2319.HK
600887:CH
600597:CH
1230.HK
1117.HK
2269.JP

Vinamilk

VNM.VN

Maximum
75th Percentile
Median
25th Percentile
Minimum

Current
Share
Price ($)
As of
13-Sep-13
4.33
5.22
2.60
0.47
0.35
54.90

% of
52-wk.
High

99%
96%
97%
96%
93%
99%

7,650
8,965
2,877
1,661
1,682
4,044

7,393
9,091
2,832
1,328
2,010
6,023

6.47

99%

5,392

5,163

Equity
Value

Enterprise
Value

Enterprise Value /

Price /

LTM
Sales

2013E
Sales

LTM
EBITDA

2013E
EBITDA

LTM
EPS

2013E
EPS

1.25x
1.32x
1.26x
2.22x
7.33x
0.53x

1.08x
1.18x
1.05x
1.82x
4.29x
0.53x

19.98x
21.73x
22.11x
13.32x
37.20x
8.98x

16.90x
14.73x
17.75x
10.78x
22.68x
8.24x

37.19x
31.94x
56.55x
21.69x
25.83x
24.20x

33.11x
27.76x
46.00x
18.03x
23.46x
19.02x

3.91x

3.16x

15.61x

13.24x

18.22x

15.53x

7.33x
2.00x
1.29x
1.25x
0.53x

4.29x
1.66x
1.13x
1.06x
0.53x

37.20x
22.02x
20.85x
14.98x
8.98x

22.68x
17.54x
15.82x
11.77x
8.24x

56.55x
35.88x
28.88x
24.61x
18.22x

46.00x
31.77x
25.61x
20.13x
15.53x

Vinamilk
Scenario Analysis
(VND millions, except per share data)
CASE

DCF RESULTS (FCFF)

1-Jan-00
BASE

Base
Best
Worst
BEST

Total EV (VNDm)
Total EqV (VNDm)

112,457,753
117,370,238

167,065,701
171,978,186

Share Price (VND)

140,739

206,220

2013 P/E (x)

2013 EV/EBITDA (x)
2013 P/B (x)
Assumptions
Sales growth
Base case
Best case
Worst case
Gross margin
Base case
Best case
Worst case
Working Capital
Receivable days
Base case
Best case
Worst case

Inventory days
Base case
Best case
Worst case

Payable days
Base case
Best case
Worst case
Growth in 2nd stage (2018-2022)
Base case

17.2x
14.1x
6.1x

21.6x
18.x
8.5x

Best case
Worst case

WORST

Ref

77,681,135
82,593,620

112,457,753
117,370,238

99,038

140,739

13.5x
10.8x
4.5x

17.2x
14.1x
6.1x
2013E

2014E

2015E

2016E

2017E

23.7%
26.0%
18.0%

20.6%
26.0%
18.0%

21.2%
26.0%
18.0%

20.1%
26.0%
18.0%

20.4%
26.0%
18.0%

33.1%
36.5%
31.6%

33.5%
36.5%
31.6%

33.8%
36.5%
31.6%

34.1%
36.5%
31.6%

34.3%
36.5%
31.6%

16.6
14.6
17.9

16.6
14.6
23.0

16.6
14.6
23.0

16.6
14.6
23.0

16.6
14.6
23.0

64.0
64.0
69.8

64.0
64.0
69.8

64.0
64.0
69.8

64.0
64.0
69.8

64.0
64.0
69.8

40.0
43.2
35.6

40.0
43.2
35.6

40.0
43.2
35.6

40.0
43.2
35.6

40.0
43.2
35.6

10%

10%

10%

10%

10%

15%
5%

15%
5%

15%
5%

15%
5%

15%
5%