Getting rubber latex - Illustrative image (Photo: VNA)In its business plan announced at an extraordinary shareholders’ meeting at theend of February, the Vietnam Rubber Group (VRG) targets 4.6 trillion VND (199.68million USD) in after-tax profit in 2021, a year-on-year fall of 12 percent.
It forecast another tough year, particularly for rubber latex, with blame beingplaced on lower prices. The group’s rubber wood and rubber products will both facefierce competition.
Gross revenue topped 25.99 trillion VND last year and after-tax profit 5.23 trillionVND, up 5.67 percent and 29.8 percent, respectively. Growth was mainly spurred byits divestment from the Sai Gon VRG Investment JSC.
Experts from the Viet Capital Securities JSC said that VRG pocketed some 1.1 trillionVND from the divestment, and without this its profit would scarcely have reachedsuch a high level.
It is understandable that VRG has adjusted its profit target downwards this year,they said, in the context of unanticipated changes in the global market.
Other rubber firms like the Tay Ninh Rubber JSC (TRC) and the Phuoc Hoa Rubber JSC(PHC) also remained prudent in setting targets for 2021.
TRC aimed at 301 billion VND in revenue and 57 billion VND in pre-tax profit,down 29.6 percent and 48.8 percent year-on-year.
Meanwhile, PHR, who holds a huge advantage in developing industrial real estate,lowered its revenue target by 15 percent to 1.92 trillion VND and after-tax profittarget by 35 percent to 751 billion VND.
Along with gloomy prospects for material rubber demand this year, PHR is also facingother difficulties, including stunted rubber plantations, a shortage of workers,unfavourable climate conditions, and disease in its rubber trees. Revenue and profitwill also be critically affected by weakening investment in industrial zones dueto the COVID-19 pandemic.
According to a report from the FPT Securities JSC (FPTS), rubber prices will remainlow in 2021, at around 32-33 million VND per tonne, leaving a negative impact onthe sector’s latex business./.
VNA
