BCG Eco: Bamboo Capital trains sights on carbon credit market in sustainable development push

Multi-sector conglomerate Bamboo Capital Group has decided to establish BCG Eco, a company specializing in afforestation, forest care and forest tree nursery, in its pursuit of sustainable development goals.

It said in a release that establishment of the new company was a strategic step that sought to cash in on great opportunities in the carbon credit market.

The Vietnamese multi-sector group, listed on the Ho Chi Minh Stock Exchange as BCG, said that the new company will have a charter capital of VND20 billion ($804,800), with Bamboo Capital contributing VND5 billion from its equity and holding a 25% stake; while its subsidiary BCG Land would hold a 26% stake.

Like its parent company, BCG Eco will be headquartered at Thao Dien ward, Thu Duc city, Ho Chi Minh City.

At its 2024 AGM, Nguyen Ho Nam, chairman of Bamboo Capital’s strategic council, said the group was accelerating its ESG (environment-social-governance) journey with the application of leading modern platforms to monitor, analyze and evaluate carbon emissions at member companies.

The group noted that it has won increasing appreciation for its sustainable development reports that keep setting more higher, more rigorous standards.

As part of the parent firm’s sustainable development strategy, BCG Eco will promote environmental protection activities and bolster ESG initiatives

Global business, high potential

Carbon credit has emerged as a global business with increasing potential and Vietnam was not an outsider in this trend.

As climate change and environmental problems become increasingly serious, countries and businesses have begun to place more emphasis on reducing carbon emissions.

At COP26, the Vietnamese Government committed to achieving net-zero emissions by 2050, opening up opportunities for development of the carbon credit market.

According to Decree 06/2022/ND-CP, which sets out a development roadmap and timeline for the domestic carbon market, from now until 2027, Vietnam will focus on building regulations for management and operation of the carbon market.

It envisages a national carbon credit exchange becoming operational in 2028. The exchange will mark an important turning point in Vietnam’s efforts to live up to its net zero commitment, while opening up great opportunities for pioneering businesses in developing and trading carbon credits.

In 2023, Vietnam’s forestry sector successfully sold 10.3 million forest carbon credits (10.3 million tons of CO2) through the World Bank. At $5 per ton of absorbed carbon, the total value of the contract was $51.5 million.

This deal indicates the huge potential of the carbon credit market, says the release.

Recognizing this great potential, BCG Eco will make careful preparations to tap carbon credit market opportunities in Vietnam. With a solid foundation provided by Bamboo Capital Group and advice from experienced international partners, BCG Eco will build capacity and develop afforestation projects.

BCG Eco also aims to become an independent consulting unit, providing comprehensive solutions for businesses that want to participate in the carbon credit market, promote ESG initiatives, and expand business activities related to sustainable development.

With policy support and completion of related legal framework, BCG Eco looks to deliver significant socioeconomic value while contributing to the country’s overall goal of achieving net zero emissions by 2050.

To sum up, BCG Eco is an important part of Bamboo Capital’s long-term strategy to promote sustainable development and create long-term value for shareholders, partners and the community at large.

Bamboo Capital Group was honored early this August as a Top 50 Outstanding Sustainable Development Enterprise in 2024. The national honor recognized many ESG (environment-social-governance) activities carried out by the group.

Bamboo Capital recorded VND417 billion ($16.77 million) in profit after tax on net revenues of VND2,100 billion ($84.47 million) in H1/2024, 2.3 times higher and up 16% year-on-year, respectively.

At the end of June 2024, BCG’s total assets value increased by VND3,200 billion over the beginning of the year to VND45,308 billion ($1.82 billion). Cash-in-hand surged 56% to VND1,180 billion ($47.47 million), while short-term receivables rose to VND14,872 billion.

BCG recently increased its charter capital from VND5,334 billion to VND8,002 billion ($321.88 million), raising its equity to nearly VND20,988 billion ($844.25 million), of which undistributed after-tax profit accounted for VND518 billion, surplus equity for VND867 billion, and other capital sources from owners for VND310 billion.