Vietnam’s top lighting manufacturer Rang Dong posts 48% drop in Q1 profit

Hanoi-based Rang Dong Light Source & Vacuum Flask JSC, a veteran in Vietnam’s consumer goods sector, reported a 48% decline in Q1 post-tax profit to nearly VND101 billion ($3.9 million), blaming intensifying competition from Chinese imports and foreign-invested enterprises.

Rang Dong, listed on the Ho Chi Minh Stock Exchange (HoSE) as RAL, recorded net revenue of VND1,528 billion ($58.75 million), a 46% drop compared to the same period last year, according to its newly-released consolidated financial statement.

In explaining the decline, the company cited several major challenges.

Firstly, a surge in foreign imports, particularly Chinese products stemming from industrial overcapacity, along with increased competition from foreign firms relocating their investments to Vietnam.

Secondly, widespread business closures across Vietnam. In 2023, 172,000 businesses exited the market. That number jumped to 198,000 in 2024 - a 15.1% increase. Alarming still, 67,000 businesses closed in just the first two months of 2025, nearly double the 2024 monthly average.

Thirdly, the dominance of foreign retail corporations, which benefit from long-established organizational structures, modern business models, and advanced platforms - especially in online and O2O (online-to-offline) commerce. These companies are increasingly capturing the attention of Vietnam’s 100+ million consumers, drawing away Rang Dong’s customer base.

Fourthly, technological disruption, particularly from the Fourth Industrial Revolution (Industry 4.0), including 5G, artificial intelligence (AI), and renewable energy. These emerging technologies are gaining traction and directly challenging Rang Dong’s traditional product lines and business approach.

Despite the tough environment, Rang Dong has taken proactive steps to modernize.

At Rang Dong Techday 11, company leaders presented their transformation strategy during this "breakthrough era." They highlighted progress on three major science and technology research projects aligned with the Politburo's Resolution 57-NQ/TW, which promotes technological advancement, innovation, and digital transformation on a national scale.

The event also featured the final round of an internal competition aimed at applying digital technologies - such as robotic process automation (RPA) and AI-powered virtual assistants - across the company's production and business operations.

Notably, Rang Dong has long invested in innovation: 15% of its after-tax profits are allocated to a science and technology development fund, and 7.5% to a venture capital fund - resources few domestic firms commit at such scale, both in terms of capital and human talent.

At the closing session on Monday, RAL stood at VND104.200 ($4) per share.