VFS Stock Forecast & Price Target

VinFast Auto Ltd is poised for significant growth, anticipating more than doubling vehicle deliveries in FY25, bolstered by its strong presence in Vietnam and successful initial sales in Indonesia and the Philippines. The company expects improved margins as production volumes increase, alongside the benefits of a new platform design that will lower unit costs. Additionally, VinFast's strategy of offering affordably-priced electric vehicles and leveraging vertical integration within its manufacturing processes contributes to a positive outlook on the stock's performance.

VinFast Auto Ltd has revised its FY25 gross margin estimate to -30.8%, a decrease from the previous estimate of -22.3%, indicating a conservative approach amid ongoing financial challenges. The company has also lowered its blended auto average selling price (ASP) to $14K for FY25 and $16.1K for FY26, resulting in anticipated revenues of $3.4 billion and $4.485 billion, respectively, down from earlier forecasts. Additionally, key risks, including supply chain disruptions, manufacturing constraints, and a highly competitive market, contribute to an EBITDA loss of $419 million, highlighting significant financial vulnerabilities moving forward.