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Tag: Vietnam

  • Vingroup reports acquisition, sale of multiple companies

    Vingroup reports acquisition, sale of multiple companies

    Vietnam’s biggest private conglomerate Vingroup sold stakes in five companies and acquired shares in six others last year, according to its audited consolidated financial statement.

    It sold 80 percent each of MV Real Estate JSC and the MV1 Real Estate JSC to Mitsubishi Corporation and Nomura Real Estate Development of Japan, and 90 percent of S-Vin Vietnam Real Estate Trading JSC to Japanese real estate company Samty Co., Ltd.

    Vingroup earned profits of nearly VND16.9 trillion ($728.45 million) from the three deals.

    It also sold a 25 percent stake in Phu Quoc Tourism Development and Investment JSC for a profit of over VND1.4 trillion, and currently owns a 5 percent stake.

    The conglomerate signed a deal with the Phu Quoc Tourism Development and Investment JSC to operate hotels, golf courses, and beachfront villas in Phu Quoc Island’s Bai Dai ecotourism area and Vinpearl Safari.

    It sold a 40 percent stake in animal feed company Viet Thang Feed JSC and now owns 26.34 percent of it.

    Vingroup spent over VND15 trillion to buy mining company Huong Hai-Quang Ngai Company Limited, real estate companies Dai An Investment Construction JSC and Nguyen Phu Trading Investment JSC, and hotel and restaurant operating firms Hon Mot Tourism JSC and Cam Ranh Invest JSC.

    It bought a 96.5 percent stake in Bao Lai Investment JSC, which mines and processes white marble to produce ground calcium carbonate powder for VND2.7 trillion. Last year Bao Lai reported a loss of VND367 billion.

    Vingroup reported revenues of VND110.4 trillion, down 15.5 percent from 2019. Its pre-tax profit was VND13.9 trillion, a year-on-year decrease of 10.7 percent.

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  • Vietnam Airlines once again calls for setting minimum fares

    Vietnam Airlines once again calls for setting minimum fares

    Vietnam Airlines wants aviation authorities to set floor fares and increase the ceiling, saying it would ensure fair competition among carriers.

    In a proposal it sent to the Civil Aviation Authority of Vietnam, it wants the fare ceiling to be increased by VND50,000-250,000 ($2.17-10.86), and minimum fares to be 35 percent of the ceiling, or VND787,500-1.01 million.

    It claimed having minimum fares would ensure fair competition among airlines and help them overcome the hardship caused by the Covid-19 outbreak, but said they could be scrapped once the aviation industry recovers from the pandemic.

    Analysts said if the proposal is accepted, airlines would not be able to offer free flight tickets under promotions, and tourism companies and passengers would be the losers.

    In 2017, Vietnam Airlines had suggested fixing minimum domestic fares of VND1.54-4.2 million ($68-$185), while its subsidiary Jetstar Pacific had proposed VND600,000-1.2 million.

    But both were rejected by the Ministry of Transport.

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  • H&M caught in a catch 22 as Vietnam boycott begins

    H&M caught in a catch 22 as Vietnam boycott begins

    H&M’s attempt to mend fences in China after angering consumers there with its stance against forced labor appears to have triggered another boycott next door in Vietnam.

    The Swedish fashion retailer drew Vietnam’s ire after it posted a map on its website that depicts islands in the South China Sea as Chinese territory. Vietnam has a competing claim on the islands. H&M changed the map at the request of authorities in China, according to Vietnamese media.

    Authorities in Shanghai said they summoned H&M’s local unit last week to address an issue with a map on its website, though it is unclear if this is the same map as the one angering Vietnamese citizens.

    In Vietnam, Twitter and Facebook users have been circulating images of a crossed-out map of China next to a map of Vietnam reflecting Hanoi’s claims to the islands and demanding the company apologize or have its 11 stores in the Southeast Asian country shuttered.

    The company has been attempting to win back consumers in China, where it became a lightning rod for public anger after multiple foreign brands stopped carrying items made using cotton from Xinjiang because of reports of human rights and labor abuses in the Muslim-majority region. It has been the subject of boycotts, and a number of its physical stores have been forced to close by landlords since the controversy flared up. H&M stores even disappeared from leading mapping service Baidu Maps and ride-hailing platform Didi Chuxing.

    The territorial dispute in the South China Sea is a hot-button topic in Vietnam. Hanoi has been one of, if not the most, vocal governments pushing back against Beijing’s claim to govern most of the sea, though the U.S. often calls for freedom of navigation in the region, calls which European powers have recently echoed.

    The dispute is not just a matter of government interest, either. When maps of the region are published, the Vietnamese public looks closely to see how the islands are portrayed. Backlash has followed perceived slights from an array of institutions, from the Hollywood film “Abominable” to the maps in passports issued by Beijing. Even the U.S. Embassy in Hanoi was accused of misrepresenting the territorial issue in September, when it posted on Facebook a Vietnam map with the islands, only to later delete the archipelagos.

    While the uproar in Vietnam adds to H&M’s recent headaches in Asia, the company is just one of several multinationals caught up in the Xinjiang controversy. Nike, Adidas, Burberry and others are also struggling with the balance between retaining Chinese shoppers and complying with Western laws against forced labor and other human rights violations. The U.S., Canada, the European Union and the U.K. all slapped sanctions on China in March, citing the country’s human rights violations against Uyghur Muslims.

  • Thai cement giant to make Vietnam ‘top priority’ market

    Thai cement giant to make Vietnam ‘top priority’ market

    Siam Cement Group (SCG), one of Thailand’s leading industrial companies, has earmarked Vietnam as its top priority market in upcoming years.

    Once a petrochemicals plant comes online in southern Vietnam, the company anticipates revenue from Southeast Asia excluding Thailand would rise to 35 percent of the total from the current 26 percent, its CEO Roongrote Rangsiyopash told Nikkei.

    “We have several projects ongoing, some big ones like a chemicals complex in northern Vietnam. That one, fortunately, has had no impact from the pandemic,” he added.

    The group has seen a trend of localized production within ASEAN and will make this a focus.

    “For the next few years, I foresee Vietnam would be our top priority,” Roongrote stated.

    SCG recently signed an agreement to buy 70 percent of Duy Tan Plastics, the largest manufacturer of rigid plastic packaging products in Vietnam, bringing its number of packaging companies in the country to eight.

    The group started investing in Vietnam in 1992. It has over 20 subsidiaries in Vietnam in the cement and building materials, chemicals and packaging industries. It has been investing in the packaging industry for over a decade.

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  • Techcombank expects profit growth

    Techcombank expects profit growth

    Vietnam’s largest private lender Techcombank targets an increase of 25 percent in this year’s pre-tax profits to a record VND19.8 trillion ($858 million).

    It expects credit to grow by 12 percent. Profits rose by 23 percent last year to VND15.8 trillion.

    It has undistributed profits of VND26.7 trillion, which it plans to use to fund operations. It has not paid dividends for the last 10 years.

    In a year when businesses struggled to repay loans due to the impact of the Covid-19 outbreak, the lender saw provisions for bad debts triple to VND2.66 trillion.

    Meanwhile, the bank’s board is seeking shareholders’ permission to make Ho Anh Ngoc, a brother of chairman Ho Hung Anh, a director.

    Ngoc, 39, has a doctorate in economics from Macquarie University in Australia. He has held several positions in the bank since 2017 and is currently chairman of the bank’s southern representative board.

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  • Vietnam startup CEOs earn less than Indonesian, Singaporean peers

    Vietnam startup CEOs earn less than Indonesian, Singaporean peers

    The CEOs of early startups earn a median salary of $1,000 per month, lower than those in Indonesia and Singapore, a recent report says.

    A startup in the $0–5 million funding stage pays its CEO $2,000 a month in Indonesia and $4,000 in Singapore, according to a recent report by Southeast Asia-focused venture capital firm Monk’s Hill Ventures and Asia-Pacific jobs site Glints.

    For startups in the $10-50 million funding stage, CEOs in Vietnam get paid $6,000, compared to $11,500 in Singapore.

    But vice presidents engineering in Vietnam startups in the Series B stage earn up to $10,000 a month, same as in Singapore, while the monthly remuneration in Indonesia is $7,100.

    Due to an oversupply of fresh graduate junior engineers in markets such as Indonesia and Vietnam, starting salaries can be low; however, they quickly grow with a few years of experience to the $700–1,200 range.

    Engineers in Vietnam typically earn higher salaries than those in Indonesia but lower than their Singapore peers, the report says.

    A senior frontend developer, for example, earns up to $2,800 in Indonesia, $3,500 in Vietnam and $9,500 in Singapore.

  • Hanoi to take over metro operation in May

    Hanoi to take over metro operation in May

    Hanoi’s first metro line Cat Linh – Ha Dong is set to be handed over to city authorities in May for commercial operation.

    The company that built it, China Railway Sixth Group Co Ltd., on Wednesday began the process of handing over the Cat Linh – Ha Dong Metro Line to local authorities.

    The handover will take three to four weeks.

    Deputy Transport Minister Nguyen Ngoc Dong told reporters Wednesday that since January, Hanoi authorities have been working to finish the last details of the project, like setting up signs for disabled passengers, installing a device to prevent the conductor from falling asleep and adding more staff at each station to supervise and assist passengers embark and disembark.

    Each train on the route will be capable of carrying 960 passengers. A one-way trip will take 23 minutes, including a 30-second stop at each station.

    There will be a train every 10-15 minutes in the initial period, with higher frequency during rush hours.

    The Cat Linh – Ha Dong Metro Section is set to be the first such project to operate in Vietnam. It runs 13 kilometers on elevated tracks through 12 stations from downtown Dong Da District to Yen Nghia in Ha Dong District in the southwestern part of the city.

    The project has been delayed for years and missed several commercial operation deadlines with the Ministry of Transport blaming the Chinese contractor for its inexperience.

    Last year, its safety evaluation was delayed several times because the Chinese and French experts who had returned home late January and were unable to return to Vietnam since international flights were grounded due to the Covid-19 pandemic.

    The section, one of eight lines planned in the city of 8.3 million, is expected to partly resolve chronic traffic congestion and motivate more residents to use public transportation.

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  • Vietnam Airlines to resume commercial flights to Asian destinations this week

    Vietnam Airlines to resume commercial flights to Asian destinations this week

    Vietnam Airlines will reopen international commercial flights connecting Hanoi and HCMC with several Asian destinations including South Korea, Japan and Australia, starting this Saturday.

    The national flag carrier said flights from Hanoi to South Korea’s Incheon City will depart every Thursday while there will have seven flights from Hanoi to Japan’s Narita City in April, with the first scheduled to depart on April 3.

    The carrier will also operate one flight from Hanoi to Australia’s Sydney every Saturday, while flights from HCMC to Sydney would depart every Thursday and Sunday.

    On return trips, the carrier would only carry Vietnamese citizens being repatriated or foreign experts with permission to enter the country. Vietnam is yet to open its doors to foreign tourists.

    A representative of the carrier said the resumption of these international routes are meant to meet growing travel demand of Vietnamese citizens wishing to study and work abroad as well as stranded foreigners longing to return home.

    In addition to these routes, the national flag carrier is planning to operate inbound commercial flights to carry passengers from Japan, South Korea and Taiwan, but is awaiting the government’s approval for this move.

    Vietnam closed national borders and canceled all international flights in March last year. Since then, only Vietnamese repatriates, foreign experts and highly-skilled workers are being allowed in with stringent conditions.

    Vietnam Airlines had said earlier that it is awaiting approval from the U.S. government to launch regular direct flights to that country.

    Vietnamese aviation authorities Wednesday proposed allowing vaccinated foreign passengers into the country from September without requiring centralized quarantine.

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  • Apple to accredit independent repair shops in Vietnam

    Apple to accredit independent repair shops in Vietnam

    U.S. consumer electronics giant Apple will extend to Vietnam a program that provides independent repair shops with access to genuine parts.

    In a blogpost Monday, the company said it would open registrations for the program later this week for Vietnam and 37 other markets including Australia, South Korea and the UAE.

    In other countries like China, it will begin later this year.

    This means customers will not need to visit Apple authorized service providers to get their iPhone and Macbook problems fixed and can instead go to third-party repair providers.

    Interested businesses can join the program for free but must have an Apple-certified technician (certification is also free) doing the repairs.

    The technicians must pass exams through an online authorized testing center and the certification is updated on a product basis annually.

    Apple said further applicants must be an established business with documents available for review by it, and have easily accessible premises and not a residential address.

    “Qualifying repair providers can purchase genuine Apple parts and tools at the same price as [authorized service providers] and receive free access to training, repair manuals and diagnostics,” Apple wrote.

    There are already over 1,500 accredited independent repair shops in the U.S., Canada and Europe.

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  • Vietnam stock market reaches new historic peak

    Vietnam stock market reaches new historic peak

    Vietnam’s benchmark VN-Index surged 2.07 percent to a new historic peak of 1,216.10 points Thursday, driven by Vingroup and Vietcombank tickers.

    The index rose throughout the day after breaking the 2018 peak of 1,204 points in the morning. It continued to surge in the afternoon and ended with a near 25-point gain.

    This is its biggest daily gain in six weeks. The index has ended in the green four sessions in a row.

    Trading value on the Ho Chi Minh Stock Exchange (HoSE), on which the index is based, surged 16 percent to VND16.94 trillion ($735 million). The bourse saw 334 stocks gain and 106 lose.

    VIC of the biggest conglomerate Vingroup contributed most to the VN-Index gain with 4.6 points. The ticker rose 4.3 percent, its seventh gaining session in a row, up by a total 15 percent since March 23.

    VCB of state-owned lender Vietcombank pulled the index up by 2.1 points with volume tripling from Wednesday to rise 2.2 percent.

    Other major contributors included HPG of steelmaker Hoa Phat Group, VHM of real estate giant Vinhomes and VNM of dairy giant Vinamilk, together pushing the index up by 4.4 points.

    The strongest blue-chip gainer was SSI of leading brokerage SSI Securities Corporation with a ceiling increase of 6.9 percent, followed by TCH of real estate company Hoang Huy Investment Financial Services JSC with a 5.9 percent gain.

    Foreign investors broke off four consecutive net selling sessions with a net buying value of VND45 billion. They focused on VIC, HPG and STB of Ho Chi Minh City-based lender Sacombank, which surged 17 percent in the last six sessions.

    The HNX-Index for stocks on the Hanoi Stock Exchange, home to mid and small caps, surged 2 percent, while the UPCoM-Index for the Unlisted Public Companies Market added 0.37 percent.

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  • Vietnamese exporters squeezed by Suez blockage

    Vietnamese exporters squeezed by Suez blockage

    The congestion caused by the Suez Canal blockage is delaying the shipment of Vietnamese goods to Europe and the Americas, and the exporters are fretting.

    The owner of a seafood exporting company in the southern province of An Giang is waiting for a five-container ship to pass through the canal on its way to France.

    However, the ongoing congestion will not allow the ship to exit the canal until Friday or Saturday, delaying the shipment by two weeks, exposing the company to fines of 0.3-0.5 percent of the order value.

    This is the first major delivery of the company this year and the owner fears major damage, given the high value of the shipment. He is hoping that the buyer will acknowledge the force majeure circumstance and not impose any fine.

    Many Vietnamese logistics companies are in the same boat after the six-day blockage caused by the mega-ship Ever Given disrupted the global supply chain by jamming the shortest shipping route between Europe and Asia.

    Even though the ship was moved on Monday, Le Duy Hiep, chairman of the Vietnam Logistics Business Association, said most companies were still seeing their shipments delayed.

    Imports from Europe and the Americas to Vietnam are also being put off, he said.

    “Nearly 400 ships, including those from Vietnam, are queued up at the canal. It will take days to clear all the ships, causing damage to both logistics companies and exporters,” he said.

    Europe is one of Vietnam’s biggest seafood export markets with a value of more than $1 billion last year. The resurgence of Covid-19 in some countries there and the Suez blockage is causing major difficulties for Vietnamese exporters.

    Truong Dinh Hoe, general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), said that Vietnam and many other countries are short of containers for exports and face surging freight rates, and the Suez blockage could make this go even higher.

    Tran Thanh Hai, deputy head of the export-import department under the Ministry of Industry and Trade, said that the blockage is a wake-up call for Vietnamese businesses. He urged them to be more careful and prepare for worst-case scenarios.

    For example, transporting goods by train from Vietnam to Germany costs slightly higher than ships, but takes 15-20 days less, and businesses should consider this an alternative option, he said.

    Businesses should also buy the insurance and think of it as part of their regular expenses instead of taking chances, he added.

  • VinMart to become WinMart

    VinMart to become WinMart

    A year after conglomerate Masan Group acquired it from Vingroup, the VinMart retail chain is set to become WinMart.

    The rebranding would take place after the restructuring of the retail chain is complete, Truong Cong Thang, CEO of The CrownX, a subsidiary that operates VinMart, said at the Masan annual general meeting Thursday.

    The CrownX reported a 14 percent rise in revenues last year to VND31 trillion ($1.35 billion), with VinMart+ convenience stores achieving revenue growth of 42 percent despite shutting down over 744 underperforming stores.

    Danny Le, CEO of Masan Group, said the company plans to increase the number of VinMart and VinMart+ outlets by 30,000 in the next five years, with 20,000 of them being franchised.

    In December 2019, the company acquired a 83.74 percent stake in VinCommerce, the subsidiary of Vietnam’s biggest private conglomerate, Vingroup, which operated VinMart chain.

    The chain, which reported a $100-million loss in 2019, broke even last year, and Masan now targets annual sales of $7-10 billion and double-digit profit growth by 2025.

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  • Vietnamese carriers restart direct US flight race

    Vietnamese carriers restart direct US flight race

    Bamboo Airways and Vietnam Airlines are locked in a race to become the first Vietnamese carrier to establish a direct route to the U.S. The race has been re-triggered by the large demand for such flights amid the Covid-19 pandemic.

    Trinh Van Quyet, chairman of Bamboo Airways, said that the global vaccination campaign will help create a boom in the aviation industry by the end of this year. This is why the airline wants to fly directly to the U.S. in the last quarter of this year, he said.

    He had earlier announced a plan to make Bamboo Airways the first Vietnamese carrier to conduct regular direct flights to the U.S. However, it failed to meet its own deadline last year.

    The board of directors of flag carrier Vietnam Airlines has also approved a plan to launch direct flights to the U.S. early next year, saying it was the right time to do it. Since May last year, the airline has conducted 12 repatriation flights from the U.S. It has used up the number of repatriation flights allowed by U.S. authorities and is now seeking permission for regular flights.

    Such flights will help utilize its wide-body fleet, which has been in low demand due to the pandemic. Vietnam has considered regular direct flights to the U.S. since 2003, but profitability concerns have made carriers hesitant. Vietnam Airlines leaders have said earlier that low demand and fierce competition could lead to annual losses of $30 million in the first five years.

    American carriers have faced the challenges that Vietnamese carriers face now, and stopped direct flights between the two countries long ago. United Airlines launched a direct service in 2007 but pulled the plug on it in 2012, while Delta Air Lines flew its direct service for a mere six months in 2008. No American carrier has launched a direct flight since.

    The market entrance of Bamboo Airways in 2019 stirred up the race again, with its leadership expressing confidence that it was possible to make a profit with direct flights to the U.S.

    Bamboo Airways chairman Quyet had calculated that the airline could earn VND8 billion ($346,700) a month from direct flights with a return ticket price of $1,300.

    Without direct flights, people have to transit in East Asia while traveling between Vietnam and the U.S., and the journey can take 18-21 hours. A direct flight would shorten the travel time to 15-17 hours.

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  • First quarter sees 16 percent rise in business closures

    First quarter sees 16 percent rise in business closures

    Around 23,800 are temporarily closed, up 28.2 percent, and more than 5,000 have permanently ceased to do business, a 26.4 percent increase, while 11,300 others are completing dissolution procedures.

    The majority are small, newly-established companies that were vulnerable to the impacts of the Covid-19 pandemic.

    Some 29,300 enterprises were established during the quarter, down 1.4 percent, and 14,700 others resumed operations after temporarily closing.

    A survey of the manufacturing sector by the GSO found 68.6 percent of firms saying their business situation is better than in the previous quarter, and 85 percent believing it would improve next quarter.

    The majority said strong competition was the main factor affecting their business. Other factors included low demand, resource crunch, raw material shortage, and lack of human resources.

    Only 27.8 percent of firms reported an increase in the number of domestic orders from the previous quarter, and 25 percent said there was an increase in exports.

  • AEON to build $190-mln shopping mall in northern province

    AEON to build $190-mln shopping mall in northern province

    Vice-chairman of Bac Ninh People’s Committee, Vuong Quoc Tuan, said the province would provide support for the key project to get underway as soon as possible.

    General director of AEON Mall Vietnam, Nakagawa Tetsuyuki, said the Bac Ninh Province’s traditional products and farm produce would be sold at the outlet and possibly be exported to Japan. Around 3,000 jobs would be created, he added.

    In February AEON had signed an MoU with Thua Thien-Hue to do market research for opening an AEON mall in the central province. It is likely to cost $160 million.

    AEON has six malls in HCMC, Hanoi and Hai Phong and the southern province of Binh Duong.

    It plans to have 20 across the country by 2025 with the total investment of $2 billion.