Vietnam refinery operator BSR plans listing in Jan next year

Binh Son Refining and Petrochemical JSC (BSR), the operator of Vietnam’s first oil refinery Dung Quat, plans to list its shares on the Ho Chi Minh Stock Exchange (HoSE) on January 17, 2025.

The firm will delist 3.1 billion BSR shares from the unlisted public companies market (UPCoM) on January 7, according to an initial 2025 business plan issued by the its board on Tuesday.

Next year, BSR aims for an output of 6.7 million, including 2.2 million tons of RON 95 gasoline, 2.5 million tons of diesel oil, 600,000 tons of RON 91/92 gasoline, 600,000 tons of Jet A1 fuel.

The company targets VND114.65 trillion ($4.5 billion) in consolidated revenue and VND752 billion ($30 million) in net profit in 2025, up 20% but down 34.5% from the 2024 plans, respectively.

BSR intends to spend VND500 billion ($19.6 million) on a cash dividend payout of 1% next year.

The corporation plans an issuance of bonus share at 60% next year to raise its charter capital to VND50.07 trillion ($1.97 billion) from VND31 trillion ($1.22 billion).

The company is expected to spend VND1.4 trillion ($55.1 million) on basic infrastructure development and VND337 billion ($13.2 million) on equipment purchases.

Among these investments, the largest allocation of VND958 billion ($37.62 million) will go to a project upgrading and expanding the Dung Quat Oil Refinery, aiming to increase its capacity from 148,000 barrels to 171,000 barrels per day.

Approved in March 2024, this project is scheduled for completion in the third quarter of 2028, with a total investment of VND36.39 trillion ($1.5 billion).

BSR will also spend VND239 billion ($9.4 milion) on the construction of a crude oil storage tank at the existing Dung Quat Oil Refinery. Approved in July 2024, this project features a designed capacity of 65,000 cubic meters and a total investment of VND532 billion ($21 million).

The cautious business plan for 2025 was outlined by BSR’s board amid the challenging conditions faced by the petrochemical industry. According to VPBankS’s report, the profit margin for the oil refining sector has been declining since the end of 2023.

The crack spread (the difference between the price of crude oil and refined oil products) in the U.S. market has fluctuated between $12 and $15 per barrel, which is only one-third of the level seen in October 2023.

While there are signs that the crack spread may have bottomed out and begun to recover, the recovery remains modest. In Singapore, the crack spread showed some improvement Q3/2024, but the increase was not significant.

BSR reported Q3/2024 revenue of VND31.95 trillion ($1.26 billion), a decrease of 15.6% compared to the same period last year.

In the first nine months of this year, the firm posted revenue of VND87.06 trillion ($3.43 billion), down 17.5% year-on-year, and a net profit of VND674 billion ($26.59 million), down 89.1%.