AsemconnectVietnam - SSI Research estimates that the 2023 revenue and net profit of PetroVietnam Gas Corporation (stock code GAS) will decrease by 11.5% and 27.4%, respectively, from the peak set in 2022, reached VND89,178 billion and VND10,937 billion.

In 2022, GAS recorded revenue of VND100,724 billion, net profit of VND15,062 billion, up 27.5% and 72.2% respectively compared to the previous year's results, and exceeded the plan by 26% and 114%, respectively.
The main driver of the year was the dry gas segment, contributing 77% to the increase in gross profit compared to 2021. Total dry gas production recovered 8% from the low base in 2021, to 7.7 billion m3, as demand from gas power plants and fertilizer producers recovered.
In 2023, SSI Research expects dry gas consumption to be 8 million m3, achieving a modest growth of 4% over the same period due to the general economic slowdown that may affect energy demand.
In the first two months of 2023, Vietnam's electricity output decreased by 2.2% over the same period last year. However, the mobilization rate of gas power plants in 2023 may improve compared to 2022 due to reduced hydropower capacity with less favorable hydrological conditions forecast.
Meanwhile, falling oil prices could bring profits back to normal. The team predicts Brent oil prices to average $83 per barrel, down 17% year-on-year – a high base in 2022, due to slowing global demand growth and the impact of inventory settings.
According to the IEA, global oil inventories reached 7.8 billion barrels in January, the highest level since September 2021 (up 52.9 million barrels from the previous month), with OECD oil inventories increasing by 55 million barrels, four times the five-year average increase. Despite the positive recovery in demand in China, the global market has turned from a deficit in the first half of 2022 to a supply surplus in the past three quarters.
With a high correlation of 0.9 times of FO and LPG prices compared to Brent oil prices in the past 10 years, SSI expects that FO and LPG prices will decrease by 17% and 13% respectively over the same period due to the correction of crude oil price.
Therefore, SSI revised down its forecast for revenue and net profit in 2023 by 23% and 14%, respectively, compared to previous estimates (VND113,113 billion and VND12,768 billion). Accordingly, GAS's revenue and net profit reached VND89,178 billion and VND10,937 billion, respectively, down 11.5% and 27.4% year-on-year from the peak in 2022, respectively.
However, SSI believes that GAS still has a positive long-term outlook. GAS has LNG Thi Vai project (the first LNG project in Vietnam) which has completed all mechanical construction and is expected to come into operation in 2023. Su Tu Trang Phase 2B project with total investment capital USD1.1 billion investment is expected to deploy EPCI by the end of 2023 and put into operation in 2026.
N.Nga
Source: VITIC/Tinnhanhchungkhoan