Group III

Analysis of 5 companies listed in Vietnam Stock Exchange

under ‘Wholesale’ sector
 Vietnam at Glance
1. GDP 244.95 Billion USD
2. GDP growth 7.31%
3. Per Capita Income 1,964.50 USD
Selected Sector: Wholesale (107 companies listed)
Average growth of sector: 11.7%
 1. Hoang Huy Investment(TCH)
Core Business: Motor Vehicles/ parts, Real Estate
Indicators 2015 2016 2017 2018
Size (Total Assets) 2,273 4,644 4,856 6,310
Revenue Growth 25.15% 28.40% -54.95%
ROA 8.01% 10.79% 9.04% 4.48%
Working Capital 993 680 708 729
Net Profit 162 500 439 282
Cash from Operation -388 -225 731 830
• TCH had sound growth in 2016 & 2017 but its sales declined sharply in 2018 due to decline in sharp decline in sales of automobiles, interruption in import
process and non inclusion of real estate revenue as real estate projects could not be completed on time and handed over.
• Despite drastic decrease in revenue, the company’s Net Profit margin increased to 34.14% in 2018 from 23.86% in 2017 due to decrease in COGS and increase in
income from subsidiaries and joint venture companies. However, Net profit is also in decreasing trend. In 2017, net profit due decreased due to significant in
COGS though revenue was growing.
• ROA of company is decreased significantly due to significant decrease in revenue but increase in total assets. Same is the case for 2017 as well. Long term assets
increased by 26.54% in 2018 itself.
• Working Capital is in increasing trend indicating which is attributed to increase in trade AR. Though sales is decreased but AR is increasing means company is
having problem in collection.Cash from operation is positive for last two years. The company’s AP also increased leading to increase in cash from operation.
 2. Phu-tai Joint Stock Company(PTB)
Core Business: Motor Vehicles/ parts, Real Estate, Stone, wood
Indicators 2015 2016 2017 2018
Size (Total Assets) 815 1,110 1,415 2,096
Revenue Growth 20.22% 8.44% 18.84%
ROA 14.75% 15.35% 13.99% 11.77%
Working Capital 484 777 938 1332
Net Profit 173 265 345 385
Cash from Operation 302 64 216 150
• PTB has expanded its business in other areas as well which contributed in sound growth. However, in 2017 the growth rate decreased due to volatile global market
condition of export oriented processed stone business and decrease in sales from real state business due to increased price of properties (Inflation)
• The return on assets shows a steadily decreasing trend over the time period as both inventories and intangible assets increases over the time period due to
expansion of a new wood processing factory.
• PTB also witnessed sound growth in working capital which is due to their involvement in stone processing business thus increasing inventory. Their Trade
receivables is also increased due to real estate business. Alternately, the cash flow from operating activities shows a decreasing trend over the time period as the
increase in working capital causes holding up of more cash over the course of time.
• Cash flow from operating activities decreases to almost 50% from 2015 to 2018 which indicates that the company is in high need of cash which is mainly managed
by short term and long-term borrowings and financial leases.
 3. Vietnam National Petroleum Group(PLX)
Core Business: Petroleum & natural gas
Indicators 2015 2016 2017 2018
Size (Total Assets) 50,414 54,244 61,769 56,171
Revenue Growth -16.21% 24.86% 24.88%
ROA 6.07% 9.49% 6.33% 7.21%
Working Capital 3,819 3,288 4,409 4,811
Net Profit 2,724 4,669 3,468 3,650
Cash from Operation 6,448 4,671 1,777 4,371
• As PLX is leading distributor of petroleum products with 48% market share and demand of petroleum is ever increasing, their growth rate is significant over the years. Further,
price of crude oil increased by 27.6 in 2018 which is also main contributor of revenue growth. The revenue decline in 2016 was attributed to lower oil prices.
• Absolute value of Net income of PLX is significantly higher than other companies, however due to its very large asset size, their ROA is lower than another company PTB.
Higher ROA is observed in 2018 mainly due to increase in Net profit and decrease in total Assets. Mainly cash & inventory are decreased while long term assets remained at
similar level
• Working Capital is in increasing trend indicating which is attributed to increase in trade AR & Decrease in trade payables maintaining liquidity position healthy as % growth in AR
is lower than % growth in Sales.
• PLX made sales more than purchase leading to decrease in inventory in 2018 which increased cash flow. Cash from operation is positive thus indicating sound core business
activities but is in fluctuating trend mainly due to fluctuating levels of AR & AP. Being petroleum company, depreciation amount is very high. About 27% of total assets is for
PPE.
 4. Digi World Corporation(DGW)-ICT Goods
Core Business: ICT Related electronics goods
Indicators 2015 2016 2017 2018
Size (Total Assets) 1,256 1,306 1,594 2,223
Revenue Growth -9.59% 0.55% 55.38%
ROA 8.28% 5.13% 4.96% 4.99%
Working Capital 834 764 1,027 1,311
Net Profit 104.00 67.00 79.00 111.00
Cash from Operation -29 166 -232 -126
• DGW has achieved significant growth in 2018 as demand for technological products specially in ICT has significantly increased and they are
also expanding their IT products for focusing FMCG & healthcare sector
• Due to high amount of inventory in 2018 which is due to their expansion strategy to achieve more than 55% growth in revenue, DWG’s
working capital has also increased. ROA is about consistent for last three years though Assets size is increasing rapidly.
• Due increased AR & Inventory, the DWG’s cash flow from operating activities is negative though sales increased by 55%. This indicates
company’s inability to collect AR timely and convert inventory in cash timely.
• Though company is earning profit, the actual cash is stuck in inventory and AR so there is negative operating cash flow in last two years.
Company is meeting its cash obligations by deferring payments and long term loan but since size of financing gap is huge, they might face
liquidity problem in future where bank will have opportunity for lending.
 5. Vietnam Fumigation Company (VFG)
Core Business: Fumigation & Agro Chemicals
Indicators 2015 2016 2017 2018
Size (Total Assets) 815 1,110 1,415 2,096
Revenue Growth 20.22% 8.44% 18.84%
ROA 14.75% 15.35% 13.99% 11.77%
Working Capital 484 777 938 1332
Net Profit 173 265 345 385
Cash from Operation 302 64 216 150
• The sales of the company is in increasing trend though growth rate is fluctuating. The company increased its agencies network helping to
achieve sound revenue growth in 2018 which also increased its market share in fumigation to 60% and 8% in agribusiness.
• Total assets size is increasing mainly due to increase in AR and Inventory. In 2017, company expanded its factory too increasing PPE.
• VFG’s Working capital has more than doubled as its inventory and Trade Receivables were significantly increased which are higher than
growth in sales. This indicates the fact that, the company is having trouble in collection and cash cycle management.
• Though Net profit is increasing its cash from operation is decreased in 2018 and big chunk of money is stuck in inventory and AR. As
business is expanding well, income level and ROA also sound, there is opportunity for banks to finance as company might face shortage of
cash which company is now managing by extending payment period.
Thank You