25 years of development: the journey to conquer new victories

The August 20^th 2017 was a special landmark for Hoa Phat Group as it celebrated the 25 year anniversary of establishment. Hoa Phat Group has become one of leading industrial production groups in Viet Nam as well as a favourite brandname in many people after experiencing ups and downs in the 25 years.

Confirming stature with many important marks

After one-fourth century of development, Hoa Phat Group as developed 12 member companies with 14,200 staffs and dozens of factories nationwide from a company specialising in construction machines. With its key steel trading, Hoa Phat has been one of leading industrial production groups in Viet Nam with capitalisation of over US$2.2 billion in the stock exchange market and being given recognition from many prestigious organisations both inside and outside the country.

Proportion of profit contributions by industry groups in 2016

Hoa Phat Steel and its relevant sectors account for over 80 per cent of its total revenue and profit. Hoa Phat’s construction steel and steel pipe takes the leading position in Viet Nam in terms of both production and market share. Hoa Phat Interior has been a prestigious brandname and also taking the lead in the office furniture. Hoa Phat has become one of 7 largest private companies in Viet Nam, Top 50 most effective firms in Viet Nam, a national brandname since 2012, Top 40 largest tax payers in Viet Nam and many other prestigious awards and certificates.

Hoa Phat listed on stock exchange on November 15^th 2007

Scale and stature of Hoa Phat Group really became bigger when applying the parent and subsidiaries model as well as its listing on the stock market in 2007. It can be said that the establishment of the group model has been a right decision which performs long-term strategy of the management board. Hoa Phat Group Joint Stock Company plays a role on capital holding and management as well as providing business strategies to subsidiaries.

Mr. Tran Tuan Duong, Hoa Phat Group’s general director said the listing on the HCM City Stock Exchange (HOSE) was a big turning point in its development, confirming its leading position in the industrial production sector while creating capital mobilisation channel for its key projects in the long term period, especially Hoa Phat Steel Complex in Hai Duong Province with the current capacity of 1.7 million tonnes per year, contributing to increase its construction steel capacity to 2 million tonnes and taking the lead position in the market.

HPG’s charter capital was sharply increased by 11.5 times from VND1.3 trillion in 2007 to VND15.2 trillion in July 2017 to implement its big projects in the steel and agriculture sectors. Its revenue was also strongly increased from VND5.7 trillion in 2007 to nearly VND34 trillion in 2016. Its after-tax profit was also up by 9 times after 10 years of listing on HOSE – a extremely high profit growth for a multi-sector industrial group.

Growth chart of key indicators from 2007 – 2017

A journey of connecting value “harmony for development”

Thousands of Hoa Phat’s staffs nationwide have contributed to the group’s success by spirit of “harmony for development”. The business philosophy highly valued consolidation of each individual for the common development to help Hoa Phat overcome all challenges.

Mr. Tran Dinh Long, chairman of Hoa Phat Group’s management board said Hoa Phat’s successes thank to contributions of its staffs, suppliers and partners who are members of a big family. The group has always paid attention to training of new generations of leaders.

The close relationship between generations of leaders and employees reflected in all activities of the group

The friendship between friends formed from decades ago to the present has been clearly performed through the highest leaders when they together share, planning strategies and direction for groups or solving problems encountered in each member companies. Many retired staffs always turn to Hoa Phat, considering it as a place of pride because Hoa Phat has created them an open environment. This is a very important contribution to building a unique cultural identity in Hoa Phat.

Many partners, suppliers and agents of Hoa Phat Group also highly valued relationship with the group. They are not only business relation but also trusted friends. Mr. Phan Hai Cuong, chairman of Cuc Phuong Joint Stock Company’s management board – one of Hoa Phat’s first steel pipe agents said he appreciated Hoa Phat for its efforts to improve products’ quality. It was the reason that Hoa Phat’s products have always been given favour from customers.

Hoa Phat has also implemented many voluntary activities to perform its corporate social responsibilities (CSR). Every year, Hoa Phat implements many CSR activities such as free heart surgery for poor children, Tet gifts to poor people, supports to agent orange victims, orphan children, funds for poor people, welfare projects and scholarships to students etc. Its free meals to poor patents share difficulties to thousands of families with more than 300,000 free meals over the past 10 years.

Conquering "new stature, new strength"

The achievement and value have been the foundation and firm stepping stone for the group to grow stronger and conquering new heights, new stature in the future. In early 2017, when Hoa Phat turned 25, the Prime Minister its Hoa Phat Steel Complex project in Dung Quat in central Quang Ngai Province. This is a major project which will firmly strengthen Hoa Phat's position as one of the leading groups in Vietnam and a big steel producer in the region and the world.

Steel products have been the key sector of Hoa Phat Group

Hoa Phat Group targets to reach the revenue of VND100 trillion by 2020, a threefold increase over 2016, of which the steel segment would still contribute over 80 per cent of the total. Investors said that the investment of Hoa Phat Dung Quat Steel Integrated Steel Complex has been the right decision for the group's sustainable development. At the annual shareholders' meeting in March 2017, Mr. Tran Dinh Long, Chairman of Hoa Phat Group's management board, said that "this was a chance for Hoa Phat to have a new look and stature from 2020".

From now on, we can see that Dung Quat's products would be absorbed by the market. The Hoa Phat Dung Quat Integrated Steel Complex's first phase capacity of 2 million tonnes of steel of construction steel and high quality long steel for industry would be rapidly deployed in advance to meet market demand as well as gradually increasing market share in the central, southern regions  and exports. The second phase would have capacity of 2 million tonnes of hot rolled steel, making Hoa Phat the only steel producer in Vietnam to own a closed production line from ore to the end products including construction steel, steel wire, steel pipe and galvanized steel sheet.

In addition, Hoa Phat has also been implementing many big and potential projects such as Hoa Phat Steel Sheet in Hung Yen Province with annually capacity of 400,000 tonnes and expected to become operation in the beginning of 2018, bringing Hoa Phat Group in Top 5 biggest steel sheet producers in Viet Nam. In the agriculture sector, Hoa Phat has also gradually occupied the animal feed, big scaled breeding farm, 3F production chain following hi-tech and biological safety. The group targets to be in the Top 10 animal feed producers by 2020 and one of strong brandnames in clean and high quality food supply such as pork meat, beef and chicken.

Opportunities and future are open for Hoa Phat Group. The group is expected to conquer new heights thank to its right investment strategies and efforts of both the leaders and staffs. Hoa Phat would bring new added values to the society on the spirit of “harmony for development” in the upcoming time.

Nghi Tran