Company Insight

Hoa Sen Group Joint Stock Company (HSG) is a leading enterprise in the coated steel sector in Vietnam. In Q1/FY2026, HSG’s business performance weakened significantly, achieving only 22% and 12% of its annual revenue and profit targets, respectively. The main driver for 2026 is domestic consumption, supported by "Hoa Sen Home," while export volume may decline due to global tariff risks.

In Q1/FY2026, HSG reported net revenue of VND 8,383 billion (flat QoQ, -18% YoY) and NPAT of VND 62 billion (-26% QoQ, -62% YoY). Steel sales volume in Q1/FY2026 reached 399,394 tons (-4% QoQ, -20% YoY) due to a 52% YoY decline in exports, while domestic sales increased slightly by 5% YoY but were insufficient to offset the export drop. Gross profit margin (GPM) stood at 11.2% (-1 percentage point QoQ, -0.6 percentage points YoY) mainly due to (1) higher HRC input costs after AD20 and rising coke prices, and (2) increasing domestic competition, which made it difficult for coated steel companies to raise selling prices amidst weak exports. However, we observe that HSG's GPM contraction is less severe than its peers, thanks to the advantage of its widespread Hoa Sen Homes distribution network.

We forecast the company’s revenue and NPAT to reach VND 35,688 billion (-2% YoY) and VND 708 billion (-3% YoY) for the fiscal year 2026. Using the DCF valuation method, we update the target price for HSG's stock to VND 15,300.