Inside a warehouse of Digiworld. The company expects both revenue and profit to decline in the first quarter of 2023. (Photo: digiworld.com.vn) The global economy has started 2023 with uncertainties and challenges withinflation in many countries remaining at high levels despite showing signsof cooling down, hurting the Vietnamese economy and social situation.
The country's consumer price index grew 4.6% year-on-year during the period,while the core inflation increased 5.08%, said the General Statistics Office.Moreover, the index of industrial production fell 6.3%, foreign investmentdeclined by 38%, and export turnover was down 10.4% due to a reduction inorders.
Thereby, many enterprises expect adverse business results in the first quarter.
Particularly, the leading tyre producer Danang Rubber Joint Stock Company setsa target of 1.1 trillion VND (46.3 million USD) in net revenue and 70 billion VNDin profit before tax, both down 14% over last year.
Bao Viet Securities (BVSC) said that the company reported net revenue of 301billion VND in January, a decline of 23% year-on-year. The reduction was drivenby seasonal factors and weaker demand affected by difficulties of the widermarkets.
However, leaders of the company said that there are signs of recovery of thedomestic market in February and March. Even though the export market dropped byabout 9% to 10 million USD, it can reach 11-12 million USD a month in theremaining two months.
Meanwhile, export volume was supported by growing demand in Brazil, andimprovement in tyre orders in Asian markets such as Myanmar, Egypt and theMiddle East since February.
Digiworld also forecasts that its first quarter's revenue will decrease by 43%to 4 trillion VND, while net profit falls 38% to 130 billion VND, following thedowntrend of the fourth quarter of 2022.
Doan Hong Viet, chairman of the Board of Directors of Digiworld, said that thedemand for information and communication technology (ICT) equipment is at a lowlevel due to signs of economic recession, causing consumers to reduce spending.On the other hand, during the COVID-19 pandemic, ICT products sold well and hadnot yet reached the replacement cycle.
Challenges remain until the second quarter, the head of Digiworld said, addingthat recovery will begin in the second half of the year when the world economyis better, the Vietnamese export orders increase, and income improves, leadingto an increase in purchasing power.
Duc Giang Chemical Group plans its first quarter's revenue to reach nearly 2.6trillion VND with consolidated profit after tax of 700 billion VND, down 29%and 53% on-year, respectively. Therefore, Duc Giang Chemical's profit isforecast to continue to decline after peaking in the second quarter of2022.
Mirae Asset said that China's zero-COVID policy from May 2022 - January 2023caused a reduction in demand for semiconductor products, affecting the demandfor yellow phosphorus - the company's main product. Therefore, the reopening ofChina's economy and production promotion of electronic devices will helpsemiconductor demand rebound, balancing Duc Giang Chemical's profit in thefirst half of 2023.
Meanwhile, after achieving positive results last year, LIXDetergent sets a negative target for the first quarter of the year with profitbefore tax down 9% to 50 billion VND, while its revenue is almost flat. If itmeets the target, the results will be the company's worst performance since thethird quarter of 2021.
With difficulties in the cement market and packaging production industry,leaders of Vicem Packaging Bim Son set a target of only 261 billion VND inrevenue in 2023 and 1.5 billion VND in profit before tax. In the first quarteralone, the company estimated revenue of 62 billion VND and a loss of 180million VND.
Although its business activities have not experienced outstanding performance since2003, Vicem Packaging Bim Son never suffered a loss.
In the rubber industry, Tan Bien Rubber foresees a loss of 9 billion VND inthe first quarter of this year, while the profit is unchanged over last year at38 billion VND.
According to data from the General Department of Customs, rubber pricesdecreased by 17% on-year despite a recovery compared to the end of 2022.As of mid-February, rubber exports dipped 8% in volume and 27% invalue.
VNDirect Securities Corporation considers the reopening of China'seconomy a very good opportunity for rubber prices and exports torecover./.
VNA
