Vietnamese ballpoint pen maker scripts educational success story

No Vietnamese citizen or expat who’s resided in the country for any length of time in the last 42 years could have avoided using the ubiquitous Thien Long ballpoint pen.

After the first “Made in Vietnam” pen made its debut in 1981, the entrepreneur and his company have not looked back, going from strength to strength as it expanded into a stationery giant listed on the stock market paying out dividends regularly to its shareholders.

Businessman Co Gia Tho's desire to produce his own ballpoint pens in Vietnam saw the establishment of Thien Long's first factory in 1981 in District 6, Ho Chi Minh City.

In 1996, the Thien Long Trading and Production Company Limited was officially established, marking a new stage of development for Thien Long. Since then, the company has continuously opened new factories and increased its capacity.

In 2008, it conducted an initial public offering (IPO) and listed its TLG shares on the Ho Chi Minh Stock Exchange (HoSE) two years later.

Forty years since its inception, Thien Long restructured itself to become a group in 2021. Today, the group has eight subsidiaries in stationery production and trading, two of which were established abroad, namely Flexoffice Pte. Ltd. (Singapore) and ICCO Marketing (M) SDN.BHD. (Malaysia).

Thien Long’s charter capital has increased five times from VND155 billion in 2010 to VND786 billion ($32.43 million) now, with over 58% held by chairman Co Gia Tho, his family members and related organizations.

Over the decades, Thien Long has built and developed a wide distribution network that sees its products displayed in commercial centers, chain stores, bookstores and convenience stores in all 63 provinces and cities nationwide.

The group has not ignored e-commerce channels and the business-to-business (B2B) model that directly delivers products to schools and businesses.

Growing profit, high dividend

The group has achieved impressive results with the process of product development, renovation and diversification.

In the 2005-2019 period, it recorded continuous growth in revenue and profit. Revenue increased from VND257 billion in 2005 to VND3,252 billion ($134.2 million) in 2019, while net profit rose from VND31 billion to VND349 billion ($14.4 million).

In 2020 and 2021, affected by the pandemic, its revenue and profit shrank to VND2,600 billion ($107.26 million) and VND250 billion ($10.3 million), respectively.

In 2022, when the epidemic was under control and teaching and learning activities returned to normal, the group recorded revenues of VND3,521 billion ($145.26 million) and net profits of VND401 billion ($16.54 million), record levels in its history.

Last year, Thien Long Long Thanh, a subsidiary of the group, put into operation a new factory with a capacity of 739 million products per year. The group also opened a new distribution center at Le Minh Xuan Industrial Park in Binh Chinh district, HCMC, meeting 1,000 orders per shift.

In addition, it inaugurated the Clever Box store chain, officially entering the retail segment. The chain has five stores in HCMC and the provinces of Ba Ria-Vung Tau and Tien Giang.

In the first nine months of this year, the group posted revenues of VND2,773 billion ($114.4 million), the same as last year. Its gross profit margin also remained at 44% but increases in sales and management costs saw net profit fall 18% to VND330 billion ($13.6 million).

The group has targeted net revenue of VND4 trillion ($170.58 million) in 2023, up 13.6% year-on-year, and after-tax profit of VND400 billion ($17.06 million), the same as last year.

As of September 30, Thien Long's total assets value was VND2,661 billion ($109.78 million), 77% of which was equity. The group had debts of more than VND200 billion ($8.25 million), compared to over VND470 billion ($19.39 million) in cash and deposits.

Thirteen years since it listed on the stock market, Thien Long’s charter capital has soared five times from VND155 billion to VND785 billion ($32.43 million), mainly thanks to share bonuses and share issuances to employees under the Employee Stock Ownership Plan (ESOP).

The only time Thien Long raised capital was in 2019 when it issued 5 million shares to foreign fund NWL Cayman Holdings Ltd. At the offered price of VND85,000 ($3.5 under the current exchange rate) per share, the group raised VND425 billion ($17.53 million), creating a share capital surplus of VND375 billion.

Thien Long also paid regular cash dividends of 20% in the 2019-2021 period; and raised it to 35% in 2022. Under its approved plan, the group will maintain the rate of 35% this year.

Reaching out to the world

After entrenching itself well in the domestic market, the group has paid continuous attention to developing its presence in foreign markets. It has succeeded in taking FlexOffice and Colokit branded products to 70 countries and territories and has exported its OEM, ODM and Private Label products to major customers around the world.

The Thien Long brand has been built up steadily with continuous diversification of products to meet customer needs and tastes. It makes all kinds of office and student supplies, including fine arts devices.

Then, last year, the group “bravely stepped out of its safety zone,” as chairman Tho put it, to experience new things and creating leverage for higher growth in the future.

One expression of this approach was the establishment of a partnership with publishing firm PEGA to enable Thien Long’s expansion of its knowledge product ecosystem.

The group will continue to invest in the development of many products to serve the creative, emotional, spiritual, and personal needs of users, Tho said, adding that these activities would lay the foundation for further diversification.

“Thien Long’s product ecosystem will more fully serve the reading - writing - drawing - listening - seeing functions of the Vietnamese people,” he added.