Vietnam Rubber Group plans capital hikes for listed subsidiaries as earnings climb

Vietnam Rubber Group (HoSE: GVR) plans to raise capital at several of its listed subsidiaries, starting with Phuoc Hoa Rubber, as the state-controlled giant seeks to strengthen its subsidiaries while benefiting from high rubber prices and expanding industrial park operations.

Speaking at the group's annual shareholders' meeting on Wednesday, management said consolidated revenue for the first five months of 2026 was estimated at VND13.73 trillion ($521.6 million), while pre-tax profit reached about VND3.9 trillion ($148.16 million), up more than 30% from the same period a year earlier.

The improvement was driven by strong performance in the natural rubber business, restructuring efforts across subsidiaries and growing contributions from newer segments including industrial parks, high-tech agriculture and hydropower.

Deputy general director Tran Thanh Phung said the global natural rubber market is entering a prolonged supply deficit, with the industry expected to face a shortfall of around 500,000 tons in 2025 that could widen to a cumulative 2 million tons by 2030.

Market prices have reflected tightening supply conditions. According to Trading Economics data, natural rubber is currently trading at around 228 U.S. cents per kilogram, or roughly $2,280 per ton, above levels seen during much of the past decade.

Against that backdrop, Vietnam Rubber Group expects its average selling price in 2026 to increase by at least 5-10% from the previous year. Over the longer term, the group forecasts prices could rise from around $1,600 per ton in 2024 to approximately $2,200 in 2026 before reaching $3,000-3,300 by 2030 under what it described as a relatively conservative scenario.

Management cautioned, however, that the outlook remains closely tied to demand from the global tyre industry and the pace of recovery in key consuming markets, particularly China.

In addition to improving domestic operations, Vietnam Rubber Group is studying opportunities to expand plantation areas in Laos and Cambodia to secure long-term raw material supplies as some land in Vietnam is converted to higher-value uses.

Industrial parks seen as long-term growth engine

Alongside its core rubber business, Vietnam Rubber Group continues to accelerate development of industrial parks on its existing land bank.

Deputy general director Do Huu Phuoc said the group currently manages 19 industrial parks covering more than 6,300 hectares, with occupancy rates approaching 90%.

He estimated that approximately 33,000 hectares of rubber land in southeastern Vietnam could be converted into industrial parks between 2026 and 2035, representing nearly half of the total industrial park planning area across the relevant provinces.

Several major projects, including Rach Bap, Bac Dong Phu, Minh Hung 3 and An Dien, have already received in-principle approval. Initial infrastructure development is expected to begin from the third quarter of 2026 at Hiep Thanh, Minh Hung, Bac Dong Phu and An Dien industrial parks.

In Ho Chi Minh City, the group has also proposed becoming the strategic investor for 10 industrial parks covering roughly 7,000 hectares during 2026-2030. In Lam Dong province, the group is studying additional industrial park developments alongside renewable energy projects.

Management said industrial parks are expected to become one of Vietnam Rubber Group's principal long-term growth drivers, particularly after 2030, with both new and existing projects to be developed under green models incorporating solar power generation to supply clean energy to tenants.

Capital increases planned for subsidiaries

The group also said it is implementing plans to raise charter capital at several subsidiaries in line with recommendations contained in an inspection conclusion issued in May 2026.

Phuoc Hoa Rubber (PHR) is among the first companies to move forward, having previously approved a plan to issue more than 108 million bonus shares funded from equity in order to increase its charter capital.

Vietnam Rubber Group is also reviewing similar procedures for other listed subsidiaries, including Dong Phu Rubber (DPR) and Tay Ninh Rubber (TRC), following recommendations from inspection authorities.

The capital hikes come as several subsidiaries control substantial land holdings in Vietnam's southern key economic region, where demand for industrial park development is expected to remain strong in the coming years.

Regarding land conversion projects in Dong Nai province, management said revenue would be recognized in line with the pace of land recovery and project implementation by local authorities.

Supported by elevated natural rubber prices and an extensive land bank suitable for industrial development, Vietnam Rubber Group is pursuing a dual-engine growth strategy centered on its rubber operations and industrial park business.

The company expects rubber to remain the main earnings contributor over the medium term, while industrial parks are positioned to become its primary long-term growth driver.

On the Ho Chi Minh Sock Exchange, GVR shares closed Wednesday a VND35,550 ($1.35) apiece.