Where does Vietnam's agricultural major Hoang Anh Gia Lai stand in pig farming industry's boom?

Hoang Anh Gia Lai JSC missed out on the Vietnamese pig farming industry’s growth surge from 2024 through Q1 of this year, after halting pig production during a period of low prices.

The domestic pig farming industry has been enjoying a prosperous stretch, with pork prices remaining high since last year.

According to Avovafeed, one of the leading companies in the field of livestock feed, veterinary medicine, and aquatic medicine in Vietnam, statistics show the current price of live pigs is around VND70,000 ($2.69) per kilogram, up 40% from early 2024. These prices ensure healthy profits for both companies and farmers.

Leading livestock companies have capitalized on this trend. Dabaco Vietnam Group, listed on the Ho Chi Minh Stock Exchange (HoSE) as DBC, reported a massive profit increase in 2024, earning VND769 billion ($29.6 million), 31 times higher than in 2023.

In Q1 of this year alone, Dabaco posted a record profit of VND508 billion ($19.55 million), supported by live pig prices remaining steady at VND70,000 ($2.69) per kg, 40% higher than during the same period last year.

BAF Vietnam Agriculture (HoSE: BAF), a rising player known for its "vegetarian pig" brand, also reported record profits since its IPO. In Q1, it earned VND133 billion (5.1 million) in profit, a 13% increase year-over-year.

BAF sold over 160,000 pigs during the quarter, up 50%, bringing in VND1,124 billion ($43.26 million) in revenue, double that of Q1/2024 and nearly matching the total for all of 2023.

However, a one-time gain from land sales in Mai Chi Tho street, Thu Duc city, HCMC, tempered the profit growth from the previous year's earnings.

Hoa Phat Group (HoSE: HPG), Vietnam’s largest steel producer, also posted strong agricultural results.

The company’s agri business segment saw revenue climb 31% to VND1,987 billion ($76.48), and net profit surged to VND407 billion (15.66 million), 2.2 times more than Q1/2024.

In addition to its steel dominance, Hoa Phat leads in livestock, holding the number 1 market share for clean chicken eggs in northern Vietnam (900,000 eggs per day) and maintaining a pig herd of nearly 25,000 sows.

Meanwhile, Hoang Anh Gia Lai (HoSE: HAGL), long considered a significant player in the pig farming sector, has largely been left out of this industry “party.”

Struggles in pig farming

In 2024, HAGL’s pig farming revenue dropped by half compared to 2023, totaling VND1,003 billion ($38.6 million). Gross profit was only VND85 billion ($3.27 million), with a slim margin of 8%, far below peers like Dabaco and BAF.

The decline continued into Q1 of this year, with pig revenue plunging from VND291 billion ($11.2 million) to just VND76 billion ($2.92 million) and gross profit at VND23 billion ($885,348).

HAGL has long based its business on three pillars, including bananas, durians, and pigs. Its unique "banana-fed pig" model once delivered an industry-leading 33% gross profit margin and accounted for over 30% of total revenue in 2022-2023.

However, when pork prices collapsed between 2022 and 2023, the company halted pig farming to redirect capital toward banana cultivation.

At the company’s AGM in May 2024, chairman Doan Nguyen Duc stated that HAGL has resumed investment in pig farming, with expectations for results to show by Q4/2024 and into 2025.

Moving toward profit recovery

Despite missing out on the pig farming rally, HAGL delivered solid results in Q1/2025, largely driven by its fruit segment, especially bananas.

The company reported net revenue of VND1,380 billion ($53.12 million), up 11.2% year-over-year. Gross profit margin remained strong at 40.9%.

Revenue from fruit alone reached VND990 billion ($38.1 million), making up 72% of total revenue and rising 12% from the same period last year.

With reduced financial and operational expenses, HAGL posted an after-tax profit of VND360.4 billion (13.85 million), a 59% increase. The company has now narrowed its accumulated losses to just under VND83 billion ($3.19 million).

If this performance continues, HAGL could eliminate its accumulated losses by mid-2025. This milestone would qualify HAG shares for margin lending and make them more attractive to major institutional investors.

Chairman Duc has acknowledged that accumulated losses have been a persistent burden. He noted that many investment funds have expressed interest in entering once the company returns to positive equity, making loss elimination a top priority.

Expansion plans

By the end of 2024, HAGL had 7,000 hectares of bananas under cultivation. The company set a 2025 goal of expanding that area to 9,000 hectares but has yet to reach that target. Banana output reached 277,000 tons, with China as the primary market.

HAGL also has 2,000 hectares of durian plantations, with 500 hectares expected to be developed in 2024. The company began cultivating durian in 2018 and started harvesting small volumes in 2024, yielding 3,100 tons.

As for its banana-fed pig model, HAGL has a piggery system with a capacity of 500,000 pigs. While no new facilities will be built this year, the focus remains on restoring herd numbers.

In summary, HAGL’s current growth is driven primarily by its banana operations. In the coming quarters, additional contributions are expected from durian as harvesting ramps up and from pig farming as herd restoration efforts begin to bear fruit.

HAGL closed Friday at VND13,000 ($0.5) per share.