Southern Vietnam-based Hyosung Vina Chemicals losses persist despite capital injection

Hyosung Vina Chemicals, the Vietnam arm of South Korean chaebol Hyosung, reported another year of heavy losses in 2025, underscoring persistent financial strain despite a significant capital injection from its parent group.

According to its latest financial disclosure, the company posted a net loss of nearly VND4.21 trillion ($159.78 million) in 2025, compared with the VND4.26 trillion loss ($161.8 million) recorded a year earlier. As a result, accumulated losses have widened to nearly VND21.57 trillion ($818.93 million).

Since entry into Vietnam, the company has recorded profit only once, in 2018, at KRW207 million ($144,850) and has remained in the red since.

Despite the weak earnings, the company’s financial structure showed signs of improvement following a substantial increase in equity. Owner’s capital contributions rose sharply from VND18.73 trillion ($711.09 million) to VND30.88 trillion ($1.17 billion), lifting total equity to about VND9.99 trillion ($379.53 million) by the end of 2025, more than five times higher than a year earlier.

This recapitalization helped significantly reduce leverage. Total liabilities stood at around VND18.15 trillion ($689.3 million) as of end-2025, while the debt-to-equity ratio fell to 1.82 times from a previously elevated 14.51 times. Bank borrowings also dropped markedly, from more than VND22.65 trillion ($860.13 million) to VND11.86 trillion ($450.23 million).

However, underlying liquidity risks remain acute. According to an audited report by PwC Vietnam, the company’s short-term liabilities exceeded short-term assets by more than VND8.55 trillion ($324.73 million), prompting auditors to flag a material uncertainty related to its ability to continue as a going concern.

To mitigate these risks, the parent company, Hyosung Chemical Corporation, issued a financial support letter in February 2026, committing to provide ongoing funding support for at least 15 months from January 31, 2026.

Established in 2018 and based in the Cai Mep industrial zone in the former Ba Ria-Vung Tau province (now part of Ho Chi Minh City), Hyosung Vina Chemicals produces polypropylene, ethylene and related petrochemical products, along with liquefied petroleum gas trading and other ancillary businesses.

The company, led by CEO Kim Jong Ki, has charter capital of over VND30.88 trillion ($1.17 billion), with Hyosung Chemical Corporation holding 51% and Hyosung Vina 1st Co., Ltd owning the remaining 49%.

Parent firm Hyosung, which entered Vietnam in 2007, has invested over $4 billion in the country, making it South Korea’s third-largest investor after Samsung and LG. According to the HCMC Export Processing and Industrial Zones Authority (HEPZA), Hyosung currently operates four major projects in the city’s industrial zones with total registered capital exceeding $3.5 billion.

These include a $2.17 billion polypropylene plant and underground LPG facility at Cai Mep Industrial Zone; a $34.2 million specialized port at Cai Mep-Thi Vai; a $730 million bio-based BDO production plant at Phu My II Industrial Park; and a $570 million carbon fiber and materials manufacturing facility, also at Phu My II.