Vietnam retail majors reap rewards for persistence, perseverance
After years of making losses, the significant investments made by major retailers like Masan Group, Mobile World Investment and FPT Retail are coming good.
They are beginning to see substantial returns from their consumer goods and pharmaceutical retail chains.
The reward for their perseverance amidst evolving market trends has come in the form of entrenched consumer bases for retail chains WinMart/WinMart+, Bach Hoa Xanh and Co.opmart/Co.opfood in consumer goods and fresh food; and Long Chau, Pharmacity and An Khang in pharmaceuticals.

A Long Chau pharmacy. Photo courtesy of the company.
To build such extensive retail networks, investors have had to pour in large sums of money, accept long-term losses to establish their brands, and make strenuous efforts to find out optimal operation methods.
At the end of Q2 this year, these major investors have reported positive outcomes from their flagship retail chains.
Masan Group, listed on the Ho Chi Minh Stock Exchange (HoSE) as MSN, announced that its retail chain, WinMart/WinMart+, operated by WinCommerce (WCM), was showing signs of sustainable profitability after a prolonged period of losses.
In December 2019, Masan Group made headlines with its acquisition of VinCommerce (now WinCommerce) from private conglomerate Vingroup, which owned the VinMart and VinMart+ chain (now WinMart and WinMart+).
Before the acquisition, VinMart and VinMart+ had around 3,000 outlets, making it the largest consumer goods chain in Vietnam. However, the chain had not reached break-even point when it was sold. A Vingroup report showed that retail operations contributed significant annual losses to the parent company.
Following restructuring efforts that involved closing numerous stores and optimizing services, WinCommerce began reporting positive earnings before interest, taxes, depreciation and amortization (EBITDA) in Q4/2020, albeit modestly at VND16 billion ($643,345).
In the next three years (2021-2023), it generated hundreds of billions of VND in EBITDA for the group (VND1,100 billion or $44.22 million in 2021, VND804 billion in 2022, and VND694 billion in 2023), though it did not achieve net profitability.
In the first half of this year, the retail chain reported total revenues of VND15.8 trillion ($635.2 million), an 8.8% increase year-over-year, and an EBITDA of VND421 billion ($16.92 million), up 88%.
Notably, WinCommerce recorded positive net income in June. Masan Group sees this as an indication of sustainable profitability in the near future.
Ten years on
Like Masan, Mobile World, listed on the HoSE as MWG, is beginning to reap gains from its flagship Bach Hoa Xanh consumer goods chain.
Since investing in the chain in 2015, MWG saw cumulative losses reach VND8.76 trillion ($352.2 million) by the end of Q1/2024.
However, after persistent efforts to restructure, optimize the system and upgrade services, Bach Hoa Xanh reported profits of VND6.9 billion ($277,386) in Q2/2024, marking the “beginning of a journey bringing money to the parent company”.
MWG chairman Nguyen Duc Tai noted that with average revenues of VND1.8 billion ($72,362) per store per month, the chain has reached its break-even point after deducting all costs.
From December 2023, the chain has recorded average monthly revenues of VND1.8 billion per store, which increased to VN2.1 billion this June.
The chain earned H1/2024 revenues of VND19.4 trillion ($779.9 million), up 42% year-on-year. In June along, it earned VND3.6 trillion ($144.72 million), up nearly 5% over the previous month. The growth was primarily driven by fresh produce and FMCG (fast-moving consumer goods) segments
Successful operational model
In the pharmaceutical sector, FPT Long Chau stands out as the only chain with a successful operational model, delivering profits to its parent company, FPT Retail (HoSE: FRT), while Pharmacity and An Khang are still reporting losses.
In the first half of the year, FPT Retail's technology business, FPT Shop, saw declining revenue and incurred a loss of about VND113 billion ($4.54 million). In contrast, FPT Long Chau recorded a 67% surge in revenue to VND11.52 trillion ($463,117) and a profit of over VND200 billion ($8.04 billion).
With this success, FPT Retail saw a 22% rise in revenue to VND18.28 trillion ($734.9 million) and a net profit of VND109 billion ($4.38 million), a significant improvement from a loss of VND213 billion in the same period last year.
Expansion plans, IPOs
With the retail chains turning profitable, the focus is shifting to their expansion plans and potential initial public offerings (IPOs) or stock exchange listings.
For over a year, Bach Hoa Xanh’s leadership has concentrated on optimizing operations and improving service quality rather than expanding its store count. In the first half of this year, the chain added just three outlets, bringing the total to 1,701.
Pham Van Trong, CEO of Bach Hoa Xanh, said the primary goal for this year was to increase revenue per store. Plans for expansion into central and northern Vietnam will be considered at the year-end, he added.
Last year, MWG established a new entity, Bach Hoa Xanh Technology and Investment JSC, to operate the chain. In April, the corporation completed the sale of a 5% stake in this new company to CDH Investments, a Chinese asset management firm.
Nguyen Duc Tai, chairman of MWG, said they had no plans for additional fundraising beyond the 5% stake sale. The company was focusing instead on growing to a scale sufficient to list on the stock exchange, as promised to shareholders and the Chinese investor, he said.
Meanwhile, FPT Retail chairwoman Nguyen Bach Diep has announced a plan to raise up to 10% in charter capital through a private placement to support expansion of FPT Long Chau’s reach from provision of medicines to meeting all healthcare needs including preventive medicine (vaccination) diagnostics, treatment, homecare and insurance.
FPT Long Chau has already made major strides in preventive healthcare with the development of Long Chau immunization centers and pharmacies. Upcoming services will include LC247 for homecare and drug guarantee services in collaboration with major insurers like Bao Viet and PVI.
To facilitate the fundraising, FPT Retail has decided to establish a wholly-owned subsidiary that will manage its investment in FPT Long Chau.
Masan Group is also pushing forward with expansion plans for the WinMart/WinMart+ chain. In the first half of this year, the chain added 40 new stores, bringing the total to 3,673.
The group plans to accelerate store openings in the second half, aiming for approximately 100 new stores per quarter, with particular focus on expanding the WinMart+ Rural model in rural areas.
Strategically, the group intends to make an IPO of CrownX, which manages its food, beverage, retail and agriculture segments. With the retail chain turning profitable, CrownX’s valuation is expected to become more attractive, expediting the IPO process.
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