HAGL chairman says he sold 'everything possible' to save the company

Hoang Anh Gia Lai (HAGL) has successfully restructured with its debt reduced from VND36 trillion ($1.37 billion) to over VND6 trillion ($227.5 million), now focusing on developing raw material areas to gain scale advantages.

Shares of HAGL (HoSE: HAG) surged closed Tuesday 3.33% higher to VND18,600 ($0.7), with an enornimous trading volume of more than 50.5 million shares. The stock is now at its highest price level since July 2015.

The rally came as the company completes a decade-long restructuring after facing severe liquidity shortages and heavy debt.

Speaking at a roadshow co-hosted by HAGL and broker OCBS on Tuesday, chairman Doan Nguyen Duc said he had once been the richest man on Vietnam’s stock market - and later the poorest - as the group spiralled into distress.

Between 2008 and 2012, HAGL was "Vietnam’s number 1 real estate developer". But as the company expanded into multiple sectors and economic conditions worsened, it began losing liquidity in 2016 with total borrowings rising to VND36 trillion ($1.37 billion).

Duc said "many partners and friends" had suggested various short-term measures to keep the company afloat, but he chose instead to focus on cutting debt. "With interest expenses of VND4-5 trillion ($189.59 million) per year, the more you work, the more you lose, it cannot be restructured," he said.

"That meant I had to sell everything that could be sold, including the most valuable assets,” he said. “There were two things I said I would never sell - Hoang Anh Gia Lai Hospital and the HAGL Football Academy. In the end, I was lucky to keep the academy; the hospital was the last thing sold. Only by selling everything possible could we cut the debt."

HAGL has since reduced its borrowings from VND36 trillion ($1.37 billion) to just over VND6 trillion ($227.5 million), while profit-generating assets have expanded. The company has also erased accumulated losses and regained margin lending eligibility.

Duc said the restructuring had succeeded and that 2025 brought rapid improvement, drawing interest from investment funds.

He credited the recovery to employees who worked months without pay and to several key financial partners. “If in 2018 I had not met Ba Duong (chairman of Thaco) and transferred the agriculture unit to him, I would not have survived,” Duc said.

He also cited support from Nguyen Duc Thuy (chairman of LPBank), who “after a short conversation paid trillions of Vietnamese dong (VND1 trillion = $37.92 million) to resolve HAGL’s debts at Eximbank”, and from OCB chairman Trinh Van Tuan, who sent executives to assess HAGL’s operations in Laos and Cambodia and later agreed to support a full restructuring.

HAGL plans to expand raw material area to 24,300 ha by 2027

Duc said HAGL would pursue safe and sustainable growth through circular agriculture. The group plans to expand beyond bananas and durian into coffee and mulberry, focusing on scale advantages in raw material zones. "In agriculture, the larger the scale and the more market dominance, the higher the profit margin."

HAGL currently has 15,300 hectares of cultivation area and aims to increase this to 24,300 ha by 2027, including 7,600 ha of bananas, 3,250 ha of durian, 10,000 ha of coffee, 2,600 ha of mulberry and 850 ha of other crops. While bananas currently contribute most of the company’s revenue and profit, Duc expects the order to shift to coffee-durian-mulberry-banana within two years.

HAGL’s main markets for fruit are China, Japan and South Korea, while coffee will be exported globally. Duc said China would remain the priority market.

For fresh fruit, deep processing is not ideal because “fresh produce has higher value”, and it cannot travel far, he said. China, a market of 1.4 billion people and sharing a land border with Vietnam, offers scale with few limits. “A traditional lesson is: go to China, see what people eat, and come back to grow and raise that - success is guaranteed,” he said.

He added that China’s shift from tea to coffee consumption has been a key factor behind rising global coffee prices.

HAGL expects 2025 revenue to reach VND7.69 trillion ($291.5 million), 9% above full-year target, and net profit of over VND2.8 trillion ($106.2 million), 80% above full-year plan.

This implies nearly VND1.5 trillion in profit in Q4 alone, driven partly by over VND1 trillion in provision reversals after issuing 210 million shares for debt swaps.