Vietnam 'Shrimp seed King’ to list on mezzanine exchange

Viet Uc Seafood JSC, Vietnam’s leading shrimp seed company, has completed the list of shareholders to conduct securities depository and share trading on the unlisted public company market UPCoM.

The UPCoM functions as a mezzanine exchange that encourages firms to participate in the securities market as a first step before moving on to the main stock exchanges - HoSE and HNX.

This presents a change from the company’s previous plan, approved at its 2022 annual general meeting of shareholders (AGM), to increase its charter capital by listing on the Ho Chi Minh Stock Exchange (HoSE).

In 2022, the company recorded consolidated net revenues of VND1.73 trillion ($73.6 million) and consolidated after-tax profits of VND264 billion ($11.2 million), up 4% and down 26.8% compared to 2021, respectively.

Over the last six years, the company’s revenue has steadily increased from VND1.16 trillion ($49.12 million) in 2017 to VND1.73 trillion in 2022, but profit growth has slowed down since 2020.

Its focus on high-tech farming has helped the company lead the industry with a dominant market share and greater profit margins.

Its gross profit margin was more than 56% in 2022, compared to 10-20% at other leading companies like Minh Phu, Stapimex, Sao Ta, and Camimex.

The company dominates the nation's shrimp seed market with a market share of 30%.

In 2022, shrimp seed sales accounted for 80% of Viet Uc's total revenue, with the segment enjoying a gross profit margin of 79%.

The company's return on revenue (RoR) of 13.8% was significantly higher than the 5-7% recorded by other companies in the same industry.

Viet Uc had more than VND2.3 trillion ($97.7 million) of undistributed after-tax profit, or 88% of its charter capital, at the end of 2022. Importantly, its equity abundance has allowed the company to avoid debt and associated costs.

For 2023, the company has set a net revenue target of VND1.94 trillion ($82.3 million) and after-tax profit of VND395 billion ($16.78 million), up 12% and up 50% year-on-year, respectively.

Viet Uc Seafood is a subsidiary of the Viet Uc Group founded in 2001 by Australian Luong Thanh Van of Vietnamese origin. The group has 18 member companies and more than 2,000 associated firms managing more than 1,000 hectares of high-tech commercial shrimp farming as well as three breeding centers for shrimp broodstock, with an annual total shrimp seed production capacity of more than 50 billion.

The company currently runs nine shrimp seed production companies across Vietnam and conducts intensive shrimp farming in greenhouses located in Bac Lieu, Binh Dinh, and Quang Ninh provinces.

Van and his wife Nguyen Kim Thua own a 52.4% stake of the company. Two other major shareholders are Viet Uc Hong Kong and Lotus Asia Investments with stakes of 11.39% and 7.59% respectively.

In fact, with the chairman's interest in Viet Uc Hong Kong, his family owns 64% of Viet Uc Seafood.