Vietnam steel giant Hoa Sen beats fiscal year profit target by 75% in 9 months

Vietnamese steel giant Hoa Sen Group posted a net profit of VND696 billion ($27.53 million) in the first nine months of fiscal year 2023-2024, exceeding its yearly target by 75%.

The net profit figure marked a turnaround from a loss of VND410 billion ($16.2 million) in the same period last year, its nine-month (October 1, 2023 - June 30, 2024) financial statements show.

The firm earned VND29,163 billion ($1.15 billion) in revenue during the period, up 23.86% year-on-year.

The group’s revenue corresponding to the third quarter of its 2023-2024 FY reached VND10,840 billion ($428.7 million), up 25% year-on-year.

Its net profit of VND273 billion ($10.8 million) in the quarter was 19 times that of the same period of the previous FY.

The group attributed the profit surge to the low base level recorded in 2023 when the steel industry was in decline.

However, maintaining high profit levels for several consecutive quarters is proof of a recovery for Hoa Sen in particular and the steel industry in general, the company stated.

Hoa Sen's total assets reached nearly VND19,720 billion ($780 million), 13.58% higher than at the beginning of the fiscal year (October 1, 2023).

Hoa Sen is involved in the distribution of construction materials (Hoa Sen Home), plastic production and trading (Hoa Sen Plastic), production and trading of steel sheets (seven wholly-owned subsidiaries and one affiliated factory), real estate, and port operations.

The company, listed on the Ho Chi Minh Stock Exchange (HoSE) as HSG, closed the Tuesday session down 1.7% at VND22,900 ($0.91) per share.

On June 14, 2024, the Ministry of Industry and Trade decided to investigate and apply anti-dumping measures on some galvanized steel products imported from China and South Korea.

Data shows that the proportion of galvanized steel imported into Vietnam has increased sharply since 2023. At the end of May 2024, imports from China and South Korea were equivalent to 80% of total domestic output, compared to only 53% in January 2023.

If the anti-dumping measures are approved, experts from KB Securities Vietnam predict that businesses with a large market share such as HSG and NKG will benefit.

Galvanized steel export volume in the first five months of 2024 reached 1.3 million tons, up 53% year-on-year. Despite facing competition from galvanized steel products originating from China, Vietnam's export volume is expected to be maintained in 2024 thanks to the price difference between markets, according to the broker.