DA NANG UNIVERSITY OF ECONOMIC

FINANCIAL DEPARTMENT
CLASS 41K15.4

FINANCIAL ANALYSIS
HOA PHAT JOINT STOCK COMPANY
LECTURE BY : Tran Thi Nga
PRESENTED BY : Đỗ Phan Khánh Huyền
Võ Anh Kiệt
Huỳnh Bá Minh Nguyệt
CONTENTS
Industry Conclusion
Analysis
Introducti Financial
on Analysis

FINANCIAL
ANALYSIS
PART ONE
INTRODUCTION
 OVERALL OF THE REPORT

THE TARGET
☺ Know about the financial situation
HPG to have investment decision
☺ THE METHOD
Qualitative quantitative
☺ RESEARCH SUBJECTS
Financial situation of from 2014 - 2016
☺ THE RESULTS
Investor should invest in stock of HPG
☺ LAYOUT OF REPORT
5 Parts
OVERALL ABOUT HOA PHAT STOCK
1
Listing of HPG shares on the stock
2 market of Vietnam on 15/11/07, and
so far HPG's share price is about
ESTABLISHMENT VND 60,000
3
Started from a trading company
SIZE
specializing in construction
machines since August 1992 4 There are 12 member
companies and a hi-tech steel
BUSINESS LINES complex
5
- Steel Production
- Real Estate PRIZE
- Agriculture - Top the largest and most
- Refrigeration effective businesses in
- Furniture Vietnam
- Top 50 Best Companies
Listed
 PART TWO
INDUSTRY ANALYSIS
 INDUSTRY ANALYSIS

RIVALRY AMONG EXISTING FIRM

- High competitive ability
THREAT OF NEW ENTRANTS - Difficult to differentiate the product
- High entry costs - Growth rate and high growth potential
- Legal barriers are low
- Economic scale THREAT OF NEW SUBSITITUTE
- Too many competitors
BARGAINING POWER OF BUYES
- No alternative material for steel
- The level of dispersion of customers low - There are alternative products for
- Difference of product low, and conversion refrigeration and office
cost of customer high
- Buyer's level of understanding of BARGAINING POWER OF SUPPLIERS
information is LOW - Domestic steel prices tend to fluctuate in
the same direction as global billet prices
 PART THREE
FINANCIAL ANALYSIS
 ASSET STRUCTURE ANALYSIS
2014 2015 2016
TOTAL ASSET 100% 100% 100%
1. CURRENT ASSET 53.17% 46.71% 54.72%
a. Cash and cash equivalents 9.17% 9.30% 13.72%
b. Short-term financial investments 2.29% 2.97% 2.09%
c. Short-term receivables 7.78% 6.31% 7.21%
d. Inventory 33.44% 27.2% 30.84%
e. Other current assets 0.48% 0.94% 0.87%
2. NON-CURRENT ASSET 46.83% 53.29% 45.28%
a. Long-term receivables 0.00% 0.06% 0.05%
b. Fixed assets 41.46% 32.19% 38.13%
c. Real estate investment 0.89% 0.75% 0.61%
d. Unfinished long-term assets 0.00% 17.02% 3.48%
e. Long-term financial investments 0.28% 0.40% 0.24%
f. Other long-term assets 2.47% 2.85% 2.76%
 CAPITAL STRUCTURE ANALYSIS
1. AUTONOMY
YEAR
2014 2015 2016
RATIO
DEBT RATIO 45.83% 43.28% 40.25%
SELF FUND RATIO 53.41% 56.72% 59.74%
2. FUND STABILITY
YEAR 2014 2015 2016
RATIO
SHORT TERM RESOURCE RATIO 40.82% 39.17% 36.07%
LONG TERM RESOURCE RATIO 59.18% 60.83% 63.93%

FINANCIAL BALANCE ANALYSIS

YEAR
RATIO 2014 2015 2016

LONG TERM FINANCIAL BALANCE 2,559,724 15,513,936 7,649,940

SHORT TERM FINANCIAL BALANCE 2,328,177 3,874,222 6,483,824
 PERFORMANCE ANALYSIS
YEAR
2014 2015 2016
RATIO
ASSET USE EFFICIENCY 1.15 1.18 1.15
FIX ASSET TURNOVER 2.07 2.12 2.06
WORKING CAPITAL TURNOVER 2.11 2.32 2.21
INVENTORY TURNOVER 2.64 3.00 2.86

DISAGGREGATING WORKING CAPITAL TURNOVER

FORMULA ΔWCT = ΔNet sales + ΔWC
PERIOD TIME 2014-2015 2015-2016

ΔNet sales 0.16 0.49

ΔWC 0.05 (0.60)

ΔWCT 0.21 (0.11)

 PERFORMANCE ANALYSIS
YEAR
RATIO 2014 2015 2016

ROS 14,51% 14,24% 22,35%

ROA 16,7% 16,74% 26,20%
RE 18,25% 17,8% 27,2%

DISAGGREGATING RETURN ON ASSET

FORMULA ΔROA = ΔROS+ ΔAT

PERIOD TIME 2014-2015 2015-2016

ΔROS -0.0027 0.095698

ΔAT 0.004272 -0.006705

ΔROA 0.001572 0.088993

 PERFORMANCE ANALYSIS
YEAR
RATIO 2014 2015 2016

ROE 29,53% 26,54% 38,5%

IMPACT FACTOR OF RETURN ON EQUITY

𝐓𝐨𝐭𝐚𝐥 𝐚𝐯𝐞𝐫𝐚𝐠𝐞 𝐚𝐬𝐬𝐞𝐭𝐬
FORMULA ROS*Assets turnover* * (1-T)
𝐓𝐨𝐭𝐚𝐥 𝐚𝐯𝐞𝐫𝐚𝐠𝐞 𝐞𝐪𝐮𝐢𝐭𝐲
PERIOD TIME 2014 2015 2016
ROS 14,51% 14,24% 22,35%
AT 1.15 1.18 1.15
Total average assets
Total average equity 2.12 1.81 1.71
 𝐏𝐫𝐨𝐟𝐢𝐭 𝐛𝐞𝐟𝐨𝐫𝐞 𝐭𝐚𝐱
FORMULA *1/self fund ratio(1-T)
𝐓𝐨𝐭𝐚𝐥 𝐚𝐯𝐞𝐫𝐚𝐠𝐞 𝐚𝐬𝐬𝐞𝐭𝐬
PERIOD TIME 2014 2015 2016
Profit after tax
Total average assets
0.139 0.146 0.224
1/Self fund ratio 2.12 1.81 1.71

𝐏𝐫𝐨𝐟𝐢𝐭 𝐛𝐞𝐟𝐨𝐫𝐞 𝐭𝐚𝐱

FORMULA * (𝟏 + 𝐝𝐞𝐛𝐭 𝐞𝐪𝐮𝐢𝐭𝐲 𝐫𝐚𝐭𝐢𝐨)*(1-T)
𝐓𝐨𝐭𝐚𝐥 𝐚𝐯𝐞𝐫𝐚𝐠𝐞 𝐚𝐬𝐬𝐞𝐭𝐬
PERIOD TIME 2014 2015 2016
Profit after tax
Total average assets
0.139 0.146 0.224
1+ Debt equity ratio 2.12 1.81 1.71

𝟏 𝐃𝐞𝐛𝐭
FORMULA (𝟏 − )*(1-T)*RE*(1+ )
𝐈𝐂𝐑 𝐄𝐪𝐮𝐢𝐭𝐲
PERIOD TIME 2014 2015 2016
ICR 11.75 16.87 28.55
 CASH FLOW BASE RATIO

YEAR
RATIO 2014 2015 2016

CASH FLOW MARGIN 0.105 0.164 0.204

CF FROM OPERATION TO NET
82.52% 129.63% 103.21%
INCOME
CF RETURN ON ASSET 12,14% 17,8% 20,52%
 BUSINESS RISK ANALYSIS
 SALE
YEAR
RATIO 2014 2015 2016

VARIANCE 137,668 433,474 1,383,601

STANDARD DEVIATION 371.037 658.387 1176.265
COEFFICIENT OF VARIATION 0.058 0.095 0.141

 PROFIT

YEAR
RATIO 2014 2015 2016

VARIANCE 42,589 90,255 207,563

STANDARD DEVIATION 206.373 300.426 455.591
COEFFICIENT OF VARIATION 0.219 0.301 0.236
  ROA
BUSINESS RISK ANALYSIS
YEAR
RATIO 2014 2015 2016

VARIANCE 0.007 0.0001 0.0002

STANDARD DEVIATION 0.084 0.013 0.015
COEFFICIENT OF VARIATION 0.457 0.319 0.218
 ROE
YEAR
RATIO 2014 2015 2016

VARIANCE 0.0308 0.0004 0.00039

STANDARD DEVIATION 0.1756 0.0219 0.0197
COEFFICIENT OF VARIATION 0.7620 0.329 0.206

RATIO YEAR 2014 2015 2016

DOL 1.4 0.38 4.15
 FINANCIAL RISK ANALYSIS
YEAR
RATIO 2014 2015 2016

DFL 1.09 1.06 1.03

SHORT TERM LIQUIDITY RISK

YEAR
RATIO 2014 2015 2016

CURRENT RATIO 1.3 1.19 1.51

QUICK RATIO 0.47 0.474 0.63
CASH RATIO 0.22 0.23 0.38
CASH FLOW RATIO 0.29 0.45 0.57
INVENTORY TURNOVER 2.6 2.95 2.79
ACCOUNT RECEIVABLE TURNOVER 14.78 17.99 18.13
INTEREST COVERAGE RATIO 11.83 16.87 28.5
 ALTMAN ZSCORE
YEAR
RATIO 2014 2015 2016

Net working capital 2,729,079 1,922,344 6,197,767

Retained earning 4,094,767 5,549,332 9,486,351
Total assets 22,089,104 25,506,769 33,226,552
EBIT 7,981,776 4,241,167 4,120,150
Market value of equity 90,100,000 90,100,000 90,100,000
Book value of total liability 10,123,765 11,040,059 13,376,291
Net sales 25,525,349 27,452,932 33,283,210
ALTMAN ZSOCRE 8.095 6.916 6.075
PART FOUR
CONCLUSION&
FORECAST
 INDUSTRY FINANCIAL OPERATIONAL RISK
- Production and STRUCTURE EFFICIENCY - Business risks
consumption are forecast - The structure is vary from year to
- High asset use
to grow at an average stable and year, but tend to
efficiency
annual rate of 12% reasonable increase
- Great property
- Free trade of steel - - High autonomy - High financial
rotation
increase competitive and stability risk, due to
Good profitability
pressure - Achieve financial increased debt
- Expansion of steel balance in both - Insolvency risk of
consumption market: short and long term is low, not likely
USA, Mexico
 GOOD BYE

THANK YOU FOR WATCHING AND LISTENING

022