Masan CEO: Stocks are being priced 60% lower than their real value

At the annual meeting this morning, the heads of each business segment of Masan Group (MSN) stepped on stage to present their content. This method is different from previous years when each person stood up to speak separately. This helps highlight the message that Masan’s business segments will be more firmly connected, as Chairman of the Board of Directors (BOD) Nguyen Dang Quang said in his opening speech.

In his sharing, CEO Danny Le said MSN stock price is about 60% lower than the actual number. According to him, the reason is that the leadership “has not fully told the journey and consumer service strategy of the entire Masan ecosystem”.

Currently, Masan Group has main business segments including consumer goods production (Masan Consumer – MCH), modern retail (WinCommerce – WCM), meat production (Masan Meatlife – MML), mining (Masan High-Tech Materials – MSR). In addition, they also own Phuc Long tea and coffee chain.

At the dialogue part, a shareholder asked the management to explain why the stock price has not grown. Mr. Danny believes that the reason is because the market is valuing MSN only through MCH and MSR, not fully reflecting MML, WCM and Phuc Long. Therefore, this group will focus on promoting a model that connects all business segments more firmly, thereby helping the market understand and reflect the full potential of the entire division.

Share with VnExpressCEO Masan added that since acquiring WinCommerce, they have suffered a loss of about 150 million USD. The group’s cash flow in 2020 is about 80 million USD. The market is starting to have big questions about whether Masan can turn around this retail system that is facing many problems.

“This year, there is a very high possibility that we can increase cash flow 7 times, reaching more than 500 million USD, which is the answer to that big question mark,” he affirmed.

In addition, when talking about Masan, according to Mr. Danny, many people often think that they are building separate businesses and think that it is a complicated business model. In fact, although MSN has many different business divisions, it still has a unified strategy and is maximizing synergy to be able to own the consumer retail value chain from start to finish. He believes that this year’s business results will help shareholders, the market, the media and investors in Vietnam see the value of Masan.

“What we do is no different than Steve Jobs did when he launched the iPhone, when he brought phone, Internet and music into one solution. That’s why we call this a consumer operating system,” compared Danny Le.

In addition, he also stated another reason due to concerns about Masan’s ability to generate cash flow. He affirmed that this story is different when by the end of 2025, the group is generating $500 million in operating cash flow, while investment expenses (CAPEX) are not much. That helps Masan reduce debt on its balance sheet. At the same time, from the perspective of corporate finance, the ratio of net debt to EBITDA (profit before tax, depreciation and interest) decreased to 2.8 times, 3 times lower than the target.

He mentioned that some investors and the market are worried about the debt of about 400 million USD at Masan High-Tech Materials. However, with a tungsten price of $3,000 per MTU, even if the price could be halved in the next 2 years, they would still be out of debt.

“We believe we can manage the balance sheet very well and reach the healthiest state over the past five years,” he said.

Closing yesterday’s session, MSN decreased 1% to 78,200 VND per share. Compared to the beginning of the year, the market price only increased by 1.5%, but compared to the price range at the end of January, this code has adjusted about 7%. The valuation of this stock is about 28.7 times if calculated by P/E and 2.7 times if calculated by P/B. The above valuation is only equivalent to the market average and is relatively low compared to other businesses in the same industry.

In fact, in reports over the past year, many analyst groups have the same opinion that MSN is a stock but has 4 growth stories. Their remaining outstanding problems in the eyes of investors are debt management and financial health.

In a report in mid-April, Rong Viet Securities (VDSC) likened the investment potential to MSN shares through the image of “debt flowing in and out”. This metaphor implies that debt management on capital is considered a prerequisite for a multi-industry corporation model like Masan, while business results on stock price potential are significantly affected by the sharp increase in debt burden from 2020 after many mergers with new models.

Up to now, VDSC has seen many turning points in Masan’s debt management as old business models stabilize, new models explode from the recovery story of Masan Consumer and expand the store network based on the profitable formula established since 2025 of WinCommerce and Phuc Long, thereby promoting the Masan Meatlife model. Most especially, this analyst group believes that Masan will receive “more favorable times” thanks to the tungsten story.

In the March report, KB Securities Vietnam (KBSV) expected Masan Consumer to recover thanks to gradually adapting regulations for business households. At the same time, the scale of the modern retail system continues to expand, taking more market share from traditional stores. Masan’s mining segment is also forecast to bring profit growth thanks to benefits from tungsten selling prices.