#SSIR Textile and garment updates: 
The protests in Bangladesh broke out since October 2023 and it has disrupted business activities ever since, especially the textile and garment industry which accounts for 90% of its exports. We note that top fashion brands from the EU (H&amp;M, Zara, etc.) are the country’s major exports. Many of the country’s factories have been shut down since then, which meant buyers already considered shifting the orders to alternative countries such as China, India and Vietnam. As a neighboring country who provides cotton for Bangladesh, we believe India is the biggest beneficiary for this short-term shift. For Vietnam, local garment manufacturers with highest exposure to the EU market and high proportion of CMT orders (which is Bangladesh’s competitive advantage) might benefit from the shift. We note that Bangladesh’s market share in apparel export to the US remained the same at 7.1% from 2023 to 1H24 and the US remained Vietnam’s biggest apparel export market. As such, among our textile and garment coverage, we think TNG will benefit the most due to its higher exposure to the EU and a higher proportion of CMT orders compared to peers such as TCM and MSH. In 1H24, TNG posted net sales and net income growth of +6% YoY and +30% YoY, respectively, which partly reflected the shift in orders from Bangladesh since the early beginning of the year, per management. In 2Q24, sales advanced +61% QoQ. TNG has full orders until the year-end and is negotiating price for orders in 2025. Our 1Y target price for the stock is VND 30,000/share (+19% upside).

#SSIR Textile and garment updates: 
The protests in Bangladesh broke out since October 2023 and it has disrupted business activities ever since, especially the textile and garment industry which accounts for 90% of its exports. We note that top fashion brands from the EU (H&M, Zara, etc.) are the country’s major exports. Many of the country’s factories have been shut down since then, which meant buyers already considered shifting the orders to alternative countries such as China, India and Vietnam. As a neighboring country who provides cotton for Bangladesh, we believe India is the biggest beneficiary for this short-term shift. For Vietnam, local garment manufacturers with highest exposure to the EU market and high proportion of CMT orders (which is Bangladesh’s competitive advantage) might benefit from the shift. We note that Bangladesh’s market share in apparel export to the US remained the same at 7.1% from 2023 to 1H24 and the US remained Vietnam’s biggest apparel export market. As such, among our textile and garment coverage, we think TNG will benefit the most due to its higher exposure to the EU and a higher proportion of CMT orders compared to peers such as TCM and MSH. In 1H24, TNG posted net sales and net income growth of +6% YoY and +30% YoY, respectively, which partly reflected the shift in orders from Bangladesh since the early beginning of the year, per management. In 2Q24, sales advanced +61% QoQ. TNG has full orders until the year-end and is negotiating price for orders in 2025. Our 1Y target price for the stock is VND 30,000/share (+19% upside).