Vietnam National Textile and Garment Group (Vinatex) has said it willrely on dividends from its affiliates and associate companies as a mainsource of income after it undergoes equitisation even though it willheavily invest in material production, the Saigon Times Daily reported.
BIDVSecurities Company (BSC), the consultant for Vinatex’s initial publicoffering (IPO), announced a report at a road show of Vinatex in Ho ChiMinh City on July 4, saying Vinatex will invest 3.4 trillion VND ineight fiber projects in 2013-2017 and 6 trillion VND in nine fabricprojects in 2014-2017.
The country’s leading textile and garmentfirm is looking to obtain revenue of nearly 1.9 trillion VND this yearand boost it to nearly 8.7 trillion VND in 2016.
However, Vinatexestimates low gross profit, at only 80 billion VND this year, 197billion VND in 2015 and 313 billion VND in 2016. Its after-tax profit isprojected to rise from 300 billion VND in 2014 to 562 billion VND in2016, buoyed by dividends from its affiliates and associate companies.
LeTien Truong, Deputy General Director of Vinatex, said Vinatex’sstrategy is to invest in material manufacturing plants, which willmainly supply its affiliates and associate companies in the originaldesign manufacturer (ODM) chain.
This will help the industrymeet the Yarn Forward requirement in the Trans Pacific Partnershipagreement, which Vietnam is expected to sign with 10 other Pacific Rimcountries – the United States, Australia, Brunei, Canada, Chile,Malaysia, Mexico, New Zealand, Peru, Singapore, and Japan.
Forinstance, Viet Tien is a major shirt producer in the country but it hasto import 70 percent of its cloth needs. Vinatex’s forthcoming clothproduction factories will supply companies like Viet Tien, making itpossible for those firms to sign ODM contracts with customers from theTPP countries, Truong explained.
Therefore, Vinatex’s investment in material plants will see low risk as it will not compete with other material providers.
Asper the report, the parent firm Vinatex obtained 116 billion VND inrevenue last year. The figure included those from only three units.
Financialinvestments have always made up a large contribution to Vinatex’srevenues, including dividends from member companies and deposit interestsums. Last year it earned 423 billion VND from financial investments,including 322 billion VND worth of dividends.
Viet Tiencontributed the biggest dividend with 67 billion VND, followed by VietThang with 29.6 billion VND and Phong Phu with 48.1 billion VND. Vinatexhad had 38 units as of end-2013.
The garment giant’s IPO wouldbe implemented on the Ho Chi Minh Stock Exchange on July 22 with nearly122 million shares out of 500 million shares. With an initial price of11,000 VND per share, the IPO is expected to raise 1.22 trillion VND.-VNA
BIDVSecurities Company (BSC), the consultant for Vinatex’s initial publicoffering (IPO), announced a report at a road show of Vinatex in Ho ChiMinh City on July 4, saying Vinatex will invest 3.4 trillion VND ineight fiber projects in 2013-2017 and 6 trillion VND in nine fabricprojects in 2014-2017.
The country’s leading textile and garmentfirm is looking to obtain revenue of nearly 1.9 trillion VND this yearand boost it to nearly 8.7 trillion VND in 2016.
However, Vinatexestimates low gross profit, at only 80 billion VND this year, 197billion VND in 2015 and 313 billion VND in 2016. Its after-tax profit isprojected to rise from 300 billion VND in 2014 to 562 billion VND in2016, buoyed by dividends from its affiliates and associate companies.
LeTien Truong, Deputy General Director of Vinatex, said Vinatex’sstrategy is to invest in material manufacturing plants, which willmainly supply its affiliates and associate companies in the originaldesign manufacturer (ODM) chain.
This will help the industrymeet the Yarn Forward requirement in the Trans Pacific Partnershipagreement, which Vietnam is expected to sign with 10 other Pacific Rimcountries – the United States, Australia, Brunei, Canada, Chile,Malaysia, Mexico, New Zealand, Peru, Singapore, and Japan.
Forinstance, Viet Tien is a major shirt producer in the country but it hasto import 70 percent of its cloth needs. Vinatex’s forthcoming clothproduction factories will supply companies like Viet Tien, making itpossible for those firms to sign ODM contracts with customers from theTPP countries, Truong explained.
Therefore, Vinatex’s investment in material plants will see low risk as it will not compete with other material providers.
Asper the report, the parent firm Vinatex obtained 116 billion VND inrevenue last year. The figure included those from only three units.
Financialinvestments have always made up a large contribution to Vinatex’srevenues, including dividends from member companies and deposit interestsums. Last year it earned 423 billion VND from financial investments,including 322 billion VND worth of dividends.
Viet Tiencontributed the biggest dividend with 67 billion VND, followed by VietThang with 29.6 billion VND and Phong Phu with 48.1 billion VND. Vinatexhad had 38 units as of end-2013.
The garment giant’s IPO wouldbe implemented on the Ho Chi Minh Stock Exchange on July 22 with nearly122 million shares out of 500 million shares. With an initial price of11,000 VND per share, the IPO is expected to raise 1.22 trillion VND.-VNA
