Vietnamese businesses set mixed targets

Update: 21:20 | 11/01/2021
After performing well last year despite the COVID-19 pandemic, many companies have prepared new plans for 2021. While some firms, such as GELEX, have doubled their targeted profits, others which reported good results in 2020 have lowered their expectations.
Vietnamese businesses set mixed targets
GELEX expect its profit to double this year after the merger with Viglacera. (Photo gelex.vn)

In a report after the general meeting of shareholders held at the end of December, Vietnam Electrical Equipment Joint Stock Corporation (GELEX) stated that its revenue in 2021 is forecasted at 33 trillion VND, with a profit of 1.8 trillion VND, doubling the profit targets of 2020.

The optimistic target is partially based on the planned merger with Viglacera Corporation (VGC).

Last year, the company posted an increase of 21.3 percent year-on-year to 4.8 trillion VND in revenue in the third quarter, but the profit before tax decreased by 18.1 percent to 262 billion VND and the profit after tax also fell by 13.3 percent to 218.4 billion VND.

In the first eleven months of 2020, profit after tax was at 640.9 billion VND, down nearly 8 percent year-on-year.

Even with many uncertainties ahead, Hoa Sen Group (HSG) still expects an increase in net revenue of 20 percent year-on-year to 33 trillion VND in 2021, and profit after tax is forecasted to rise 30 percent to 1.5 trillion VND, which is the highest level since 2016, according to its report after the general meeting of shareholders.

The third-quarter results showed HSG earned 8.4 trillion VND in revenue, up 32.7 percent year-on-year, while profit after tax also increased by 436.2 percent to 450 billion VND. The company reported a surge of 218.8 percent in profit after tax to 1.1 trillion VND in the first eleven months of last year.

Other companies also set higher targets for this year, including Petrosetco (PET) up 36 percent year-on-year in profit before tax; and Sao Vang Rubber Joint Stock Corporation (SRC) up 20 percent year-on-year in profit before tax.

On the other hand, Dabaco Group (DBC), which witnessed good performance last year due to higher pork prices, expects that its revenue will decrease by 11 percent year-on-year to 15.4 trillion VND in 2021, and profit after tax is forecast at 827 billion VND, down 41 percent.

In the third quarter of 2020, the company posted revenue of 2.6 trillion VND, up 40.4 percent year-on-year, and profit after tax increased nearly 15 times to 287 billion VND. As of September 30, its profit after tax was 1.13 trillion VND, more than 24 times compared to last year.

The company estimated its profit after tax in 2020 at 1.4 trillion VND, the highest level since DBG started business.

Similarly, Dam Phu My Packaging Joint Stock Company (PMP) and Petro Vietnam Cà Mau Fertilizer JSC (DCM) see their profits falling in 2021, with a decrease of 48 and 68 percent year-on-year, respectively, in profit before tax.

With the current low rates and stable exchange rate environment, many firms are expected to take out more loans to expand activities.

Besides the merger with VGC that is expected to be completed in the second quarter, GELEX is negotiating with its Japanese partner to acquire and control Dong Anh Electronic Equipment Corporation. It will also spend more on financial restructuring, GELEX Electronic and buying raw materials.

PetroVietnam Power Corporation (POW) is also expected to start the Nhon Trach 3 and Nhon Trach 4 projects in the first quarter of this year. The two projects are valued up to 1.4 billion VND.

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(Source: VNA)