FINANCIAL ANALYSIS

REPORT TITLE
EVERPIA VIETNAM JSC
4/1/2024
GROUP 6

TABLE OF CONTENTS

INTRODUCTION.........................................................................................................................5
EVERPIA’S FACTORY.............................................................................................................5
EVERPIA’S SUBSIDAIRY COMPANY..................................................................................5
SHAREHOLDERS STRUCTURE............................................................................................6
INTRODUCTION.................................................................................................................8
EVERPIA’S PRODUCTION AND BUSINESS INDUSTRY................................................8
Home textile...........................................................................................................................8
Fragmented cotton category (Fiber).................................................................................10
EVERPIA DIVIDEND PAY POLICY...................................................................................11
ESG of Everpia............................................................................................................................12
ENVIRONMENT....................................................................................................................12
SOCIAL....................................................................................................................................12
GOVERNANCE......................................................................................................................13
INDUSTRY OVERVIEW............................................................................................................14
Home-textile industry............................................................................................................17
Market Trends of Vietnam Home Textile Industry.......................................................18
COMPETITIVE POSITIONING................................................................................................20
Home-textile industry............................................................................................................20
SWOT ANALYSIS..............................................................................................................20
FINANCIAL ANALYSIS......................................................................................................22
VALUATION..........................................................................................................................28
DCF MODEL.......................................................................................................................28

PAGE 2
 REPORT TITLE
RELATIVE METHOD........................................................................................................30
SUMMARY..............................................................................................................................30
INVESTMENT RISK...............................................................................................................31

INTRODUCTION

Everpia Vietnam JSC has 30 years of operation,

Everpia constantly innovates technology, designs,
and management quality to become a leading
enterprise. Leading industry in both main
business segments: Bedding and mattress pads
and cotton sheets. To achieve this, Everpia always
set the criteria of product quality, brand
reputation, and dedicated service as a guideline to
help the company reach the sustainable
development.

PAGE 3
 REPORT TITLE

EVERPIA’S FACTORY
Ha Noi Factory Hung Yen Factory Dong Nai Factory
Square 15.000m2 17.670m2 28.956m2
Main activities Fragmented cotton Home-textile Fragmented cotton
manufacturing manufacturing and home-textile
manufacturing:
cloth, bedding
Efficiency per year 15 million yards 3 million products 6 million yards
Over 1 million
home-textile
products

EVERPIA’S SUBSIDAIRY COMPANY

Everpia Korea Joint Stock Company
Ownership ratio 100%
Operating - Import and export rights, consulting, and public transfer
category technology in the field of manufacturing and trading of
nonwoven fabric and fabric products filter, felt, blanket,
bed sheet, pillow, mattress...
- Exercise the right to import and export products: tableware,
kitchenware, toiletries, office supplies, …

SHAREHOLDERS STRUCTURE
EVE's shareholder structure is quite condensed, the major shareholders at EVE are
mainly the management board (Korean) and Korean financial institutions (NH
Invesment & Securities, Korea Investment & Securities). In addition, recently, AFC
Vietnam Fund has moved to increase its ownership rate at EVE (buying 66,000 shares -
equivalent to 0.17% ownership rate).
BSC said that EVE's shareholder structure is quite concentrated, the major shareholders
at EVE are mainly the board of directors (Koreans) and Korean financial institutions
(NH Invesment & Securities and Korea Invesment & Securities). In addition, recent
times showed the structural move of shareholder funds:
+ AFC Vietnam Fund increases ownership buys 66,000 shares - equivalent to 0.17% of
shares

PAGE 4
 REPORT TITLE
+ Korea Investment & Securities reduces ownership sells 262,700 shares, or 0.69% of
shares
+ NH Investment & Securities reduces ownership sells 416,200 shares, equivalent to
1.09% of shares

EVE's shareholders
structure
Lee Jae Eun NH Invest-
ment & Se-
curities
AFC Vietam Korea In-
Fund vestment &
Securities
Others

PAGE 5
 REPORT TITLE

INTRODUCTION

EVERPIA’S PRODUCTION AND BUSINESS INDUSTRY

Everpia operates in textile and garment technology industry . In particular, this company
participate in mainly in home textile industry. Regarding to revenues , home-textile category all
contribute significantly higher the proportion of turnover than fragranced cotton category with
87% and 13%, respectively.

Everpia Operation Category

Home-textile category Fragranced cotton category

13%

87%

Home textile
Home textile is an industry that produce fabrics and cloth that are used specially for
home-furnishing. The materials and design of each are defined by functional and
aesthetic uses of each. Some of the common home-textile include: Bedding, cloth, wipe...

In Everpia, home- textile is one of the main categories which company participate in.
This company provide bedding, cloth, some home curtain, … This kind of products
usually delivered by the B2C as allocate outcome to the 425 contributed shop system or
directly customers, B2B method with the clients was the hotel and the tourism business
and the electronic commerce. When it comes to the revenues, there is a bit difference
between cloth category and the other as the pie chart below.

PAGE 6
 REPORT TITLE

Home-textile carterogy's revenues

Bedding
Cloth
44%
51% Cutain and other
product

5%

In terms of bedding which occupy EVE’s home-textile revenue with large percentage, at
around 44% (707 billion VND). There are several branches in Everpia JSC as Everon,
Astermis, Bedding, King Koil. UAE, Dubai, Korea are the primary country that Everpia
exports bedding products. In 2023, the organization will introduce 39 collections of
bedding stuff.

Everon ESB 22055 in Everpia bedding collection.

Everpia JSC process Everon’s Curtain as a branch that focus on manufacture curtain
and other product with percents about 51% (843 billion VND) in home-textile category’s
revenue. Here is some of Everon’s Curtain.

PAGE 7
 REPORT TITLE

Everon’s Curtain products

At 5% in EVE’s home-textile revenues (79 billion VND) with Everon Home Decor in cloth
category such as: cloth, glass cloth ,.. which are made by microfiber. The export market mainly
depends on Germany, Korea, Holland

Fragmented cotton category (Fiber)

Precenting just 13% in company’s revenue but fragmented cotton is the products
manufactured for a long time mainly produced in two main factories in Hanoi and
Dongnai since 1993 which was the establishment year of company in Vietnam as TNHH
Vika Moissan Company. Its customers primarily tend to concentrate on other textiles
company which 95% revenues in this category come from the export market, mainly
Korea

PAGE 8
 REPORT TITLE

The factory capacity for fragmented cotton category

Here are some illustrations of fiber (fragmented cotton)products:

EVERPIA DIVIDEND PAY POLICY

In the period 2017-2022, EVE pay dividends at around 8% to 10%. Particularly, 2027-2021
companies pay dividends by cash, specially in 2022 the dividend pay by stocks

PAGE 9
 REPORT TITLE

ESG of Everpia
ENVIRONMENT
Increasingly local governments and international stakeholders raise attention to the
environmental impact of businesses. The environmental risks include fines and the
reputation of the Company and Company’s brands.
1. Reduce energy consumption
Through the Science-Based Targets Initiative (SBTi) tool, Everpia aims to reduce
greenhouse gas emissions by 50% in both Scope 1 and Scope 2 from 2019 to 2030 with
the goal of maintaining the global temperature increase rate at 1.5 degrees Celsius. In
order to achieve the set goal, we make continuous efforts to implement energy
efficiency initiatives and gradually shift to renewable energy sources, specifically:
• Repair the lighting system and roof at padding and sewing factories to create natural
ventilation
• Use an inverter or speed controller to adjust the speed to reduce power loss for
ventilation fans and domestic water pumps.
• Optimize the company’s staff transportation schedule.
• Use of renewable energy sources: replace renewable electric energy sources by
installing solar battery systems on the roof. The use of renewable energy sources not
only helps to reduce greenhouse gas emissions but also helps businesses significantly
reduce operating costs.
•BuildinganewfactoryinGiangDien,DongNaiaccordingtoEDGEAdvancedstandards,sav
esatleast40%ofenergy, at least 20% of water consumption, and at least 20% of energy on
building materials.
2. Natural origin materials
The sustainable development strategy at Everpia is most clearly demonstrated through
the journey to find and use materials of natural origin, environmentally friendly:
 100% of the fabrics in the collection are cotton and wood pulp-based
fabrics
 100% formaldehyde-free adhesives are used to manufacture padding
 10% of the traditional fiber is replaced with Sorona fiber, a fiber with the
main ingredient being Bio-PDO - a resin created through the fermentation of
sugar extracted from corn.
 Everpia’s efforts and determination in the journey of sustainable
development have helped the company to be honored for the 7th time in a
row by the Vietnam Business Council for Sustainable Development in the Top
100 Sustainable Enterprises in 2022.

SOCIAL
Everpia’s sustainable development strategy is built on ensuring the harmony of three
factors: Economic development; Supporting the community and Protecting the
environment. In which, supporting education and ensuring the life of employees are
always the top priorities:
 Scholarship sponsorship: Everpia continues to cooperate with Korcham
(Korea Chamber of Commerce and Industry) to sponsor excellent students
with difficult economic conditions to help them focus on studying without
financial concerns.

PAGE 10
 REPORT TITLE
 Special Tet bonus for 10 employees with difficult family circumstances All
benefits and welfare regimes for employees have strictly complied with
current regulations and commitments of the Company to employees. During
the period, the Company contributed more than VND 40 billion to the state
budget.

GOVERNANCE
The Board of Management inspected and oversaw the actions of the General Director
and members of the Board of Directors in managing production and business and
implementing Company resolutions in accordance with the Company’s Charter and
Corporate Governance Regulations. In 2022, there would be a General Meeting of
Shareholders and a Board of Directors.
The Board of Management has effectively supported the process of achieving the
strategic orientation as well as the proposed business plans, taking advantage of
opportunities from market changes due to external influences, in close collaboration
with the Board of Directors.
Strategic planning continued to be consolidated to adapt and catch up with the new
movement trend of the market. The 5-year and long-term strategic goals are
periodically evaluated in meetings of the Board of Directors and with the Board of
Directors to ensure that the company is always on the right track. This goal is also
disseminated to all employees, ensuring consistency in orientation and action at all
levels.
Governance is also promoted. Targeting the Code of Corporate Governance with best
practices, the BOD is gradually raising its governance standards to betterpractices,
beginning with appointing personnel in charge of corporate governance and
strengthening internal audit capability for the three-line defense model in risk
management.
2023 is the 8th consecutive year that Everpia was praised in the "Top 100 Sustainable
Businesses in Vietnam" and the 3rd year ranked among the Top 5 small-cap companies
with excellent Corporate Governance. These awards prove Everpia's determination and
relentless efforts in sustainable development in both management and production.

PAGE 11
 REPORT TITLE

INDUSTRY OVERVIEW
Introduction
Vietnam’s garment and textile industry consists of 3 sub-sectors: the upstream sector (fiber
production), the midstream sector (fabric production and dyeing), and the downstream sector
(garment manufacturing). The US, Europe, Japan, and South Korea are the main export
destinations of Vietnam’s textile and garment products.
The garment and textile industry is one of the key industries in Vietnam. In 2022, the industry’s
export value topped US$36.9 billion. The country’s exports have already reached US$24.6
billion in the first nine months (Jan-Sept) this year, according to the General Department of
Customs.
Notably, however, there has been a marked decline in production on the back of lower demand in
key export markets this year. Furthermore, there have been layoffs around the country in the
apparel sector on the back of lower-than-expected orders. Taiwanese footwear manufacturer Pou
Yuen, for example, has reduced its workforce by almost 10,000 workers across three rounds of
job cuts.
Factor that can shows the growth rate of textile and garment industry.

DEMAND OUTLOOK
- GDP Growth rate

Source: Statista
In 2022 Vietnam Economy growth rate is 8.02%. But by statica predict that in 2023, 2024
the GDP growth rate will drop into around 5.7%. With this GDP growth rate, it’s a good
development for many industries in Vietnam, especially for the manufacturing as textile.
But in the long run from its seem to be moderately improve so the garment and textile
industry can have a greater change in this period.

PAGE 12
 REPORT TITLE
- S&P’s Purchasing Manager’s Index

In 3 quarter of 2023, S&P’s Purchasing Manager’s Index has consistently found itself below the
50-point mark indicating production in Vietnam is in a contraction. It’s not a positive effect on
the Vietnam Garment and Textile Industry on the near future as 2023 and 2024.
- Demand on the sustainable textiles
Many countries in the world as US and the developed countries also as Vietnam are focused on
adopting values of transparency, sustainability, and authenticity to appeal to Millennials who are
the next generation of buyers. In the long term, there’s a greater opportunity if Vietnam can
supply a textile product which can ensure the sustainable textile

SUPPLY OUTLOOK
Even though, it can be not a good growth rate in 2023 and 2024 but the further future with
several opportunities, Vietnam garment and textile industry can be reach as a high potential
industry.
- FTAs
Vietnam’s bilateral and multilateral FTAs continue to provide Vietnamese manufacturers access
to new markets. With new FTAs such as the Comprehensive and Progressive Agreement for
Trans-Pacific Partnership (CPTPP) and Vietnam-EU FTA (EVFTA), Vietnam should see
increased exports with more oversea customers and a push to further develop the industry’s
supply chain so that they can take full advantage of preferential tariffs.
Further, manufacturing shifts from China to Vietnam due to the labor cost advantage and rocky
trade relations between China and the USA should also help expand Vietnam’s textile and
garment industry.
- Technology
Vietnam’s technology still owes much of its success to its relentless pursuit of technological
advancements and innovation such as Digital Transformation (Embracing Industry 4.0
principles, the industry is undergoing a digital transformation, optimizing processes, and
boosting efficiency using end-to-end integrated solutions such as WFX PLM, ERP and MES), E-
commerce and Online Flatforms, Automation and Robotics, Sustainable Solution
- Sustainability Initiatives in Focus
Vietnam has taken substantial steps to promote eco-friendly approaches in the textile and
garment sector. These initiatives aim to address the environmental and social challenges
associated with the industry’s rapid growth. Here’s some key efforts that made by Vietnam:
1. The Sustainable Textile and Apparel Program established by the Vietnam Textile and
Apparel Association (VITAS) aims to promote sustainable production practices in the
industry.
2. Vietnam’s Textile, Garment, and Footwear industry has set a vision to develop
effectively and sustainably according to the circular economy model by 2035
PAGE 13
 REPORT TITLE
3. The World Wildlife Fund (WWF) has developed guidelines for greening the textile sector
in Vietnam. These guidelines provide practical recommendations for improving
environmental performance, such as reducing water and energy consumption, minimizing
waste, and promoting the use of sustainable materials.

Overall, regarding to the demand outlook and supply outlook, the garment and textile industry
will be fluctuated in the near future but in the long run there will have many opportunities for
Vietnam.

PAGE 14
 REPORT TITLE
Home-textile industry
Vietnam’s home textile industry plays an important role in the national socio-economic
development of the country. Vietnam’s flourishing textile industry is increasing rapidly,
which is making the country one of the most popular destinations in Asia for textile
investment. Rapid urbanization, improved standard of living coupled with increasing
spending power are some of the key factors anticipated to support revenue growth of
the market in the region. Furthermore, the increasing inclination towards modernizing
the interior of households is resulting in huge demand for home textile products such as
bed sheets, pillows and covers, curtains, etc.

This section covers the major market trends shaping the Vietnam Home Textile Market
according to our research experts:
DEMAND OUTLOOK
Growth in Urbanization is Driving the Market
Vietnam's home textile market is experiencing growth due to emerging young
consumers and growing disposable incomes with the coming of urbanization.
Urbanization refers to the population shift from rural areas to urban areas. Rising levels
of urbanization have resulted in an increasing number of new households being set up.
Rising urbanization trends owing to improving the standard of living of the population
will also drive the growth of the market.

Source: Statista (https://www.statista.com/statistics/603397/vietnam-urban-population/)

In Vietnam as an developing country, the urbanization in the future still growth rapidly
so the home-textile is one of the top industry that can develop in the long run
Lifestyle Preference is Driving the Market
In the recent years, more and more Vietnamese had a change in lifestyle. Vietnamese
are more likely enjoyed to decor their home. According to a report by Grand View
PAGE 15
 REPORT TITLE
Research, the global market for home decorations is expected to reach $838.6 billion by
2027, with an annual growth rate of 3.9%. Hence, it’s a good thing when consider the
growth of the home-textile market.
Real Estate Boom
By Mordor Intelligence, The Vietnam Residential Real Estate Market size is expected to grow
from USD 22.44 billion in 2023 to USD 40.53 billion by 2028, at a CAGR of 12.55% during the
forecast period. The growth in the real estate sector, with new housing and commercial projects,
has created a substantial demand for home textile products for funishing purposes
Strong growth in tourism in the country

According to data from the Google Destination Insights travel trend tracking tool, from the
beginning of the year until now, the number of searches for Vietnamese tourism has
continuously grown at the top of the world. From 11th to 6th position, Vietnam is the only
destination in Southeast Asia in this group. Hence, it’s a good point for the growth of the home
textile Industry

Market Trends of Vietnam Home Textile Industry

Growing Viet Nam Bed Linen Segment
Bed linen includes pillow covers, bed covers, bed sheets and duvet cover. A key reason
responsible for increased spending on bed linen is the growing awareness over the
numerous physical and mental benefits offered by good sleeping. Factors driving the
growth in the country include expanding retail networks, easy access to a range of
products and increased demand for designer and luxury bed linen
market.

Source: https://www.6wresearch.com/industry-report/vietnam-bed-linen-market-2020-2026
Growing Vietnam Mattress Market

According to Mordor Intelligence, Vietnam Mattress Market size is projected to grow at

CAGR of 5.8% during 2021-2027. The increasing number of health-conscious
consumers and the rising disposable income are the major factors for the growth of the
mattress market. The projected growth in the mattress market of Vietnam for the
coming years can be attributed to the factors such as the rising prevalence of spinal and
other health conditions, demand for improved lifestyle, increasing per capita income,
and rising urban population leading to higher residential demand and a flourishing
hospitality sector. With the rising innovation by manufacturers in the mattress industry,
the adoption of newer and better-quality mattresses is anticipated to rise in the
forthcoming period.

PAGE 16
 REPORT TITLE

COMPETITIVE POSITIONING
In this garment and textile industry, Everpia is one of the well- known companies with
B2B method, but in term of B2C Everpia is at risk of loss the branch so in this
competitive position I will evaluate the position of Everpia in this industry.

Home-textile industry
SWOT ANALYSIS
Strength
- Strong brand reputation: Everpia is a well-established brand with a long history
of producing high-quality bedding products. They are known for their
innovative designs, durable materials, and comfortable sleeping experiences.
- Wide distribution network: Everpia has a vast network of showrooms and
distributors across Vietnam, reaching a large customer base. This allows them to
maintain strong brand awareness and accessibility.
- Focus on R&D: Everpia invests in research and development to continually
improve their products and introduce new and innovative offerings. This helps
them stay ahead of the competition.
PAGE 17
 REPORT TITLE
Weakness
- Susceptibility to fluctuations in raw material costs: Fluctuations in the prices of
cotton, other natural materials, and imported components can impact Everpia's
profit margins.
- High dependence on the Vietnamese market: Everpia's revenue is primarily
generated within Vietnam, making them vulnerable to economic fluctuations
and potential market saturation.
Opportunities:
- Developing new product lines: Everpia can explore new product categories
beyond traditional bedding, such as sleep accessories, furniture, or home decor
items, to diversify its revenue streams.
- Embracing sustainability initiatives: Integrating eco-friendly materials and
production processes into their operations can appeal to environmentally
conscious consumers and enhance brand image.
- Expanding into new markets: Everpia can leverage its brand reputation and
established distribution network to expand into other Southeast Asian countries
with growing demand for quality bedding products.
Threats:
- Economic downturn: A potential economic recession in Vietnam could decrease
consumer spending on non-essential items like bedding, impacting Everpia's
sales.
- Rising production costs: Increasing labor costs and raw material prices can
squeeze Everpia's profit margins and force them to raise prices, potentially
affecting sales.

By Mordor Intelligence, Everpia JSC ranks second in Vietnam Home Textile Market
Leaders in general.

PAGE 18
 REPORT TITLE

Regarding to B2C method, Everpia concentrates on the mid-end segment of home-textile

products, particularly is bedding products with the high quality. It’s a good strategy when
focusing on the mid-end segment because it’s the segments that percent most of market share
than the others.
Also, EVE has a high market share as the market leaders so with these two factors, EVE can
completely has a good positioning in the industry. But according to their government statement
in 2022, with B2C method , EVE still needs to marketing its brand as Everhome to milinenials
to avoid their loss of the brand

FINANCIAL ANALYSIS
 Net Revenue Growth
PAGE 19
 REPORT TITLE
The number one Company in the middle-end Beddingbusiness segment with
high profit margin
Revenue growth recorded a slightly downtrend in 2019 and 2020 with -14.9%
and -15.09% under the effect of COVID-19 pandemic. in 2021-2022, EVE's
business outlook is positive thanks to the following factors (i) Benefiting from the
economic recovery after Covid: export orders and orders from hotels (ii)
Expectations of restructuring Bedding business after a long period of competition
In term of gross profir margin in comparison with textile enterprises, Everpia has
an average gross profit margin of 37%, double than average gross profit margin
of others of 16.72%
Factors affecting: Profit in 2023 will decrease due to the following impacts: (i)
Depreciation costs for the new Giang Dien factory (ii) Costs for repositioning the
Everon brand. After the Giang Dien factory is put into production, it will
contribute to the strong growth of EVE's revenue and profit in 2024-2028.

link

GROSS PROFIT MARGIN

40.00% 37.62%
34.23% 34.09%
35.00% 32.27%
30.66%
30.00%

25.00% 21.13% 20.75% 20.33%

19.47%
20.00% 16.72%
15.00%

10.00%

5.00%

0.00%
2018 2019 2020 2021 2022
-5.00%

EVE GMC TNG

GIL AVG TEXTILE

 Dupont Analysis

From 2018 to 2020, the company's ROA sharply decreased due to the overall
impact of the economic situation during the COVID-19 period. From 2019 to
2021, EVE successfully overcame the post-pandemic effects and generated
profits, while the ROA rapidly increased by 77% compared to 2019. In 2022, the
ROA decreased by 4% compared to 2021 due to EVE's increased total assets
compared to 2020, while profits showed a tendency to slightly decrease due to
the operational launch of the Giang Dien factory.

PAGE 20
 REPORT TITLE
8.00%

7.00% 6.74%
6.22% 6.06%
6.00% 5.51%
5.10% 4.56% 6.22%
5.00% 4.75%

4.00%
4.48%
2.91%
3.00%

2.00%

1.00%

0.00%
2018 2019 2020 2021 2022

ROE ROA

 Leverage Index

The leverage ratio increased in 2022 due to an increase in payables by 41% and
long-term debt increased by more than VND 84 billion due to the investment in
the rights of using land and fixed assets for the factory in Giang Dien. However,
this ratio is always below 1, showing that Everpia’s assets are still at a safe level
and are still mainly financed by Owner’s capital, so there is no risk in repayment.
1.2

0.8

0.6

0.4

0.2

0
2018 2019 2020 2021 2022

D/E D/A

 Liquidity Index
About financial position, EVE showed a much better condition than peers with
both quick ratio and current ratio were much higher than average. In capital

PAGE 21
 REPORT TITLE
structure, EVE was also in safer condition than peers with 60% total asset
financed by equity, while others maintained just around 40%.
From 2018 to 2019, the current ratio decreased. The main reason for the decrease
was that short-term debt increased rapidly while short-term assets decreased,
under the impact of the COVID-19 pandemic. From 2019 to 2021, the ratio
continued to increase from 5.51. This reflects the company's positive recovery,
proving that the company is more likely to repay all debts.
Although it has decreased, the current ratio is still relatively high, indicating that
EVE has almost no liquidity risk in the short term. However, based on the above
results, in 2022, for every 1 unit of short-term debt, there are 6.43 units of current
assets to ensure. This indicates that the company is over-investing in short-term
assets, and the company is not using capital effectively.

Current Ratio
8

0
2018 2019 2020 2021 2022

EVE Industry

 Efficiency Index
Although EVE have a higher profit margin than other companies in textile
industry, its business has drawbacks. The major one is the conversion pace that
bedding and padding market showed much slower speed than the industry
average. Both days sales outstanding (DSO) and days inventory outstanding
(DIO) of EVE were much higher than peers. At around 80 days of DSO, EVE’s
business bears higher credit risk. Moreover, with DIO of above 210 days
compared to an industry average of 100 days, EVE bears higher products
degradation risk and has to use much more working capital to do business than
peers.
The slow pace also shows in cash conversion cycle (CCC) criteria. Average CCC
of EVE are around 250 days, nearly 2.5 times higher than textile peers.

PAGE 22
 REPORT TITLE

Days Sales Outstanding

90.00
80.00
70.00
60.00
50.00
40.00
30.00
20.00
10.00
0.00
2018 2019 2020 2021 2022

EVE Industry

Days Inventory Outstanding

250.00

200.00

150.00

100.00

50.00

0.00
2018 2019 2020 2021 2022

EVE Industry

CashCycle
300.00

250.00

200.00

150.00

100.00

50.00

0.00
2018 2019 2020 2021 2022

EVE Industry

 Valuation ratio
The P/E ratio evaluates the market's expectation of a company's earnings
potential and indicates how much investors are willing to pay to receive one unit
PAGE 23
 REPORT TITLE
of the company's profit. From 2018 to 2021, this index increased rapidly from 5.87
in 2018 to 15.32 in 2021, indicating the market's expectation of EVE's profit
potential. However, in 2022, this index decreased significantly, showing that
EVE's attractiveness to investors was deteriorating. Nonetheless, EVE's
profitability remains promising, indicating that investing in the company entails
lower risk and good growth prospects. With the commencement of operations at
the Giang Dien manufacturing plant in the third quarter of 2023, it is forecasted
that EVE's P/E will significantly improve in the following years.
EVE's P/B ratio in 2018 was 0.36 and consistently increased to 0.62 in 2021. From
2022, the P/B ratio showed a slight decrease, specifically down to 0.5. The
market's expectation, reflected in the stock price, is smaller than the book value,
alongside the impact of the recent stock market downturn, which has affected
EVE's stock price in recent years. However, with a strong brand in the consumer
industry, having a P/B ratio of 0.6 and a P/E ratio of less than 9, EVE's valuation
is currently very low.
14.00

11.61 11.35
12.00

10.00
8.02
8.00
6.42
5.69
6.00

4.00

2.00
0.65 0.44 0.52 0.70 0.58

0.00
2018 2019 2020 2021 2022

P/E P/B

FORECAST

Revenue Forecast
$1,600,000,000,000.00

$1,200,000,000,000.00

$800,000,000,000.00

$400,000,000,000.00

$-
18 19 20 21 22 3F 4F 5F 6F 7F
20 20 20 20 20 202 202 202 202 202

By taking the growth rate of 2023 like EVE director have said is about 7.4% with 2023f-
2027F we take the growth rate of revenue is 7.226% based on the growth rate of home
textile and the growth rate of fiber production
PAGE 24
 REPORT TITLE

Net Income Forecast

$100,000,000,000.00
$90,000,000,000.00
$80,000,000,000.00
$70,000,000,000.00
$60,000,000,000.00
$50,000,000,000.00
$40,000,000,000.00
$30,000,000,000.00
$20,000,000,000.00
$10,000,000,000.00
$-
2018 2019 2020 2021 2022 2023F 2024F 2025F 2026F 2027F

The net profit margin in 2023F-2027F is about 6%

PAGE 25
 REPORT TITLE
VALUATION
DCF MODEL

CapEx

CapEx
50,000,000,000.00
0.00
1
-50,000,000,000.00
-100,000,000,000.00
-150,000,000,000.00
-200,000,000,000.00
-250,000,000,000.00

2018 2019 2020 2021 2022

2023F 2024F 2025F 2026F 2027F

Net Working Capital

Net Working Capital

1,200,000,000,000.00

1,000,000,000,000.00

800,000,000,000.00

600,000,000,000.00

400,000,000,000.00

200,000,000,000.00

0.00
8 9 0 1 2 F F F F F
1 1 2 2 2 3 4 5 6 7
0 0 0 0 0 2 2 2 2 2
2 2 2 2 2 0 0 0 0 0
2 2 2 2 2

Free Cash Flow

PAGE 26
 REPORT TITLE

Free Cash Flow

$350,000,000,000.00
$300,000,000,000.00
$250,000,000,000.00
$200,000,000,000.00
$150,000,000,000.00
$100,000,000,000.00
$50,000,000,000.00
$-
1
$(50,000,000,000.00)
$(100,000,000,000.00)

2018 2019 2020 2021 2022

2023F 2024F 2025F 2026F 2027F

WACC

Stock Price

Stock price with different terminal growth

rate
$25,000.00

$20,000.00

$15,000.00

$10,000.00

$5,000.00

$-
6% 6% 7%
\

A, Terminal value : 5.58% , WACC : 9.29%

By applied the DCF model, with WACC: 9.29% and Terminal value we Assume it’s about
5.58% , hence we predict the one year target price will be 13.375 VND/ share

B, Terminal value : 6.08% , WACC : 9.29%

By applied the DCF model, with WACC: 9.29% and Terminal value we Assume it’s about
5.58% , hence we predict the one year target price will be 17.709 VND/ share
PAGE 27
 REPORT TITLE

C, Terminal value : 6.58%, WACC : 9.29%

By applied the DCF model, with WACC: 9.29% and Terminal value we Assume it’s about
5.58% , hence we predict the one year target price will be 20.550VND/ share

RELATIVE METHOD
Comparing EVE’s P/E with other company and Industry

By taking the P/E- relative method, particularly taking the divide of other competiors
company with their market share , hence taking their average , we calculate the one
year stock price target will be 16423VND .

Base on the Industry, the stock price of eve can be reach to 20251VND

SUMMARY

By taking both two method to determine the stock price.

Bythe development oppotunities as we mentioned above, we decide to recommend buy stock
We recommend you to by this stock with at least 14.8% upside

PAGE 28
 REPORT TITLE

INVESTMENT RISK
Market Risk - Selling costs are increasing day by day
One of the indicators that greatly affects EVE's annual profit is sales costs. In 2016, selling
expenses accounted for about 9.5% of the year's revenue. This number has continuously
increased and by 2019, sales expenses accounted for nearly 16% of total revenue. The increase in
selling expenses partly reflects the increasing difficulty of selling products due to increasingly
fierce competition in the market and the appearance of many cheap bedding products.

Environment Risk - Climate Change

In recent years, winter has tended to become shorter, warmer and not as cold as before. That's
why the demand for bedding and pillow products tends to decrease. In the future, with the effects
of climate change, the demand for bedding and mattresses may continue to decrease.

Convertible bonds
If the amount of convertible bonds the company has issued is converted into equity in the future,
the company's equity will increase by more than 200 billion. Besides, the number of outstanding
shares will increase by approximately more than 18 million shares, accounting for nearly 47% of
EVE's total outstanding shares.
With a very large number of convertible shares, the risk of EPS (lợi nhuận trên mỗi cổ phiếu)
decline of EVE shares is present and certainly investors buying EVE shares at this time must
carefully consider this risk. However, there is also the case that if EVE continues to do business
inefficiently with ROE only maintained at 8%, bondholders may not choose to convert bonds to
shares, then the risk of EPS decline will lower.

Source: https://jcpmediaroom.com/kien-thuc/co-phieu-eve-va-nhung-rui-ro-nha-dau-tu-can-can-
nhac/

Financial Risk - Liquidity

The level of liquidity on EVE's trading floor is not high, with an average trading volume of only
100,000 shares/trading session, accounting for less than 0.3% of the company's outstanding stock
volume, making it difficult to attract Large cash flow invested in the company.

CPTPP
The CPTPP Agreement was signed in March 2018, between 11 countries, including Vietnam,
which includes many agreements on reducing tariffs on goods, expected to open up many
opportunities for Enterprises in Vietnam's textile and garment sector such as accessing cheaper
raw materials or looking for new export markets.
However, EVE's main raw material and export market, South Korea, does not participate in this
agreement, so the company does not benefit from the agreement. This may make EVE less
attractive than other businesses in the same industry when investors learn and make decisions to
invest in companies in the textile and garment sector.

Operational Risk - Annual Plans

In the last two years, EVE has not achieved the revenue and profit plans set by the company at
the shareholders' meeting. At the upcoming Shareholders' Meeting, the company proposes

PAGE 29
 REPORT TITLE
planned revenue and pre-tax profit for 2018 to be VND 1,150 billion and VND 143.8 billion,
respectively.

PAGE 30
 REPORT TITLE

Reference
1. Governance Statement of Everpia 2022
2. SIS_ EVE_ Balance Sheet
3. SIS_ EVE_ Income Statement
4. SIS_ EVE_ Cash Flow
5. https://baodautu.vn/dhdcd-everpia-nha-may-moi-29-ha-hoat-dong-tu-thang-toi-tai-dinh-vi-
thuong-hieu-everon-d188658.html
6. https://www.mordorintelligence.com/industry-reports/vietnam-home-textile-market
7. https://markwideresearch.com/vietnam-home-textile-market/
8. https://www.skyquestt.com/report/home-textile-market#:~:text=Home%20Textile%20Market
%20size%20was,period%20(2023%2D2030).
9. https://www.imarcgroup.com/vietnam-home-textile-market
10. https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/ctryprem.html

PAGE 31