Sector Insight

As of the end of July 2024, commercial electricity output reached 160.41 billion kWh, marking a 12.7% YoY increase. This growth is underpinned by the robust recovery of industrial production. Specifically, the Industrial Production Index (IIP) for May and June saw significant improvements with a YoY increase of over 10%.

We anticipate that electricity production growth in 2024 will remain aligned with EVN's planned growth rate of 8.9%. Moreover, EVN has recently updated its baseline plan to a higher electricity output of 310.6 billion kWh (+10.4% YoY) in response to the record-breaking heatwave.

Listed electricity companies reported a revenue of 76,200 billion VND in 1H2024, (-6% YoY), and a NPAT of 2,566 billion VND (-64% YoY). Among these, the coal-fired power group was the only one to record positive growth, with revenue (+16% YoY) and NPAT (+10% YoY). The hydropower group recorded a decrease in revenue (-31% YoY) and a decrease in NPAT (-61% YoY); while the gas-fired power group had the worst performance, with revenue decreasing by 48% YoY and a net loss. The significant divergence in business results comes from several factors: (1) The persistent El Nino phenomenon during the first five months, coupled with low coal prices, supported the mobilization of coal-fired power generation; (2) Hydropower plants had to store water for peak seasons with very low mobilization rate; (3) High gas prices, combined with declining production at gas fields, led to low mobilization rate for many gas-fired power plants.