BAF Vietnam Agriculture JSC plans to secure a syndicated loan of up to VND500 billion ($20.9 million) from foreign banks, according to a resolution approved on Monday.
The loan is being arranged by Shinhan Bank Vietnam Limited-Ho Chi Minh City branch, First Commercial Bank-Ho Chi Minh City branch, and Daegu Bank-Ho Chi Minh City branch. BAF Vietnam, listed on the Ho Chi Minh Stock Exchange (HoSE) as BAF, did not disclose further details of the loan.
BAF is the pig breeding arm of entrepreneur Truong Sy Ba's business. The company has invested strongly in the pig segment over the past two years, and average output has reached 280,000 pigs per year.
In the first six months of this year, BAF Vietnam’s revenue reached VND2.46 trillion ($102.5 million), down 17.3% year-on-year, while its post-tax profit was VND16.07 billion ($0.67 million), down 86.6%, according to the firm’s consolidated financial statements.
BAF attributed the low revenue to a drop in its agricultural merchandise and livestock business operations. In particular, revenue from agricultural merchandise decreased by 21% due to a strategic reduction in this activity, which was subject to significant risks influenced by the Russia-Ukraine conflict.
As of end-June, the firm’s short-term and long-term loans amounted to VND1.6 trillion ($66.9 million), including convertible bonds issued to the International Finance Corporation (IFC) with an interest rate of 5.25% per annum for a seven-year term.
In February, the World Bank’s investment arm IFC became a strategic partner in BAF, following Vietnamese regulatory approval of an IFC proposal to invest $39 million investment in the firm.
BAF’s financial indicators reflect a state of stable finances, the firm said.
Though business operations have not met expectations in the first half of this year, the firm expects positive outcomes in the upcoming period, as prices of pork are projected to increase over the rest of this year.
BAF shares increased 1.61% to VND22,150 ($0.92) at the close on Tuesday.