VINGROUP

Hi guys, Welcome to gr7’s presentation.

Our presentation includes the sections as shown on the slide

I. Introduction
- :

● Vingroup, formerly known as Technocom, was founded in Ukraine in 1993 by young

Vietnamese, initially operating in the food sector and with great success with the Mivina
brand. Since 2000, Technocom- Vingroup returned to Vietnam with the hope of contributing
to building the country.
● Established after the merger of 2 leading real estate companies of Vietnam in January 2012:
Vincom Joint Stock Company and Vinpearl Joint Stock Company

In the process of formation and development, Vingroup operates in three main areas, including:

● Technology – Industry
● Trade in Services
● Social Volunteering

Besides Vietnam, Vingroup is one of the largest multi-industry private economic groups in Asia with
a market capitalization of nearly 16 billion USD.

2.

Currently, Vingroup has restructured and focused on developing many famous brand groups such as:

● Vinhomes (System of high-class serviced apartments and villas)

● Vincom (Classy shopping mall system)
● Vinpearl (Hotel, tourism)
● Vinpearl Land (Entertainment)
● Vinmec (Medical)
● Vinmart (Retail business)
● Vincharm (Beauty Care)
● VinEco (Agriculture)

- Organization and management of the company:

Now, you can see the governance chart on our slide.

Next we will come to

SWOT ANALYSIS
1. Strength
● High-quality products
Vingroup is a multi-industry corporation. However, all industries that Vingroup participates
in have high-quality products. This is in line with the group's mission “to bring a better life to
everyone”.
Vingroup's products are the result not only of Vietnamese talents but also with the
participation of foreign experts , helping Vingroup improve product quality, especially in the luxury
service segment . In addition, with the influence and strong financial resources from the group,
Vingroup also has the advantage of acquiring land and building real estate projects in a short time and
its quality has been proven.
● Good branding and high reputation.
Vingroup is a national brand of Vietnam. With a multi-industry business, covering all the
lives of Vietnamese consumers from housing to education, hospitals, tourism, etc. Surely no one in
Vietnam does not know the brand name of Vingroup.
● Good ability to raise capital.
Thanks to good project implementation and high-value collateral assets Vingroup has a
superior ability to raise capital. At the end of August 2022, Total debt (including bank loans, credit
institutions, and bonds) is 166,588 billion VND of which long-term loans were worth 110,000 billion
VND
● Management and leadership competencies
The name of the Vingroup brand is associated with the name of the founder, billionaire Pham
Nhat Vuong. Mr. Pham Nhat Vuong studied and graduated from Russia and participated in many
large and small business projects. He is also the one who founded the instant noodle brand Mivina.
The brand was later sold to Nestle for $100 million.

Under the leadership of Mr. Vuong, Vingroup has had a sound strategic vision for the future
as well as many strong investment and development directions. Besides Mr. Vuong is also a team of
experienced leaders, has a good strategic vision, and is highly educated. Many of them are graduates
of major universities around the world and have many achievements in research and manufacturing.

2. Weakness
● Human resource training
Although it is possible to call many talents from both Vietnam and the world to work together
as well as a visionary management system, there are still many assessments that Vingroup has
limitations. the mechanism in human resource training, especially for middle managers.
● New project accessibility
Besides the success of new projects such as Vinmec, Vinschool.., Vingroup also has to
experience failures in many different areas. Especially in a few industries that are not in the core
business of the industry such as beauty, e-commerce, aviation, or mobile phone manufacturing...
Some examples can be mentioned such as Adayroi's announcement to stop and merge into VinID,
chain supermarket retail VinMart had to franchise to Masan, Vinpearl Air closed… These loss-
making investments brought about a great loss of investment for the corporation.
● Financial leverage
Vingroup's investments in real estate and multi-industry projects lead to strong capital needs.
This led to a large number of loans and bonds. This leads to unavoidable risks, especially risks of
financial leverage.
In addition, real estate is always an investment field that is very sensitive to market
fluctuations. Vingroup's investment projects are all large projects with large investment capital and a
slow payback period. So the use of strong financial leverage is inevitable. This leads to a high debt-to-
asset ratio, which affects interest rates in business activities.
And here, my teammates will tell you the rest

3. Opportunities
● The increase in incomes
Through the overview analysis of Vingroup, we can see that most of Vingroup's income is
through products and services such as real estate business, trade centers, and tourism services, resorts.
Therefore, the increase and improvement of people's income is a critical factor for the development of
Vingroup. People's income is constantly improving, and Vingroup's products and services will
certainly be welcomed shortly.

According to World Bank statistics, Vietnam's GDP per capita has increased constantly, up to
3.6 times, reaching nearly 3,700 USD from 2002 to 2020. The poverty rate according to standards
USD 1.9/day also decreased from more than 32% to less than 2%. Although 2021 and 2022 are
strongly affected by the COVID epidemic and delta variant, Vietnam's growth is expected to recover
to 5.5% in 2022.

● Expansion of the service market

People's income increases, which means people's living standards will improve. This means
that the requirements for service quality will be higher and high-quality products will be more
interesting and selected instead of cheap as in the past.
● Investment potential from abroad
Vietnam's economy is in the stage of opening up, as evidenced by its accession to the WTO,
the FTA, and the Trans-Pacific Partnership. Attractive investment with many businesses and
foreigners looking for investment opportunities. Having a solid foundation and a good brand name
will be the basis for Vingroup to be able to mobilize more capital at home and abroad more
conveniently. This helps Vingroup to have more financial potential to expand its business areas.

4. Threats
● Slow growing business market
Although Vingroup is a multi-industry corporation with its strength in real estate. However,
competition is inevitable. In recent years, the level of competition in the market for leasing
commercial space, retail space, office space and apartments is becoming increasingly fierce. In
particular, Vingroup has to deal with "internal enemies" that are domestic enterprises such as Bitexco
Group, Tran Anh Group, Novaland, Dat Xanh Group, Hung Thinh Corporation, Hoang Anh Gia Lai
Joint Stock Company ... and "enemies" outside” are foreign corporations such as Ciputra Group, Land
Capital, Keppel Land..
● Complicated administrative procedures
Another challenge for Vingroup is complicated administrative procedures. Administrative
procedures in Vietnam are always considered to be very complicated and confusing, with many
different stages. And for real estate, an industry with huge cash flows, these administrative procedures
become even more complicated.
● Influence from suppliers
Vingroup is the largest real estate investment group in Vietnam, so in order to ensure the
supply of products to customers, the company also needs a source of raw materials to create products.
However, in recent years, with the impact of the COVID epidemic as well as the war between Russia
and Ukraine, the price of raw materials has escalated. This will significantly affect the sustainable
development of the group.

Not to mention the impact of the COVID epidemic in the last two years, which has made the
country's economy bleaker than ever, the stock trading output has continuously declined, making it
difficult for many businesses, including Vingroup, to access capital from potential domestic investors.

https://maneki.marketing/vingroup-swot-analysis/#iem-manh-cua-tap-oan-vingroup

Analysis of Vingroup's real estate business strategy before May 2014:

- Business area:
Vingroup has four main business segments including real estate business, real estate rental, hotel
services, and entertainment. The real estate business uses most of the group's revenue and profit,
followed by the real estate rental segment, hotel services, and resorts.
- Business results:
In general, Vingroup's revenue and profit have grown significantly from 2009 to 2013:
 - Business analysis
+ Real estate business: this is the most important segment of Vingroup, accounting for 80% of
the group's revenue: The strategy is to focus on housing projects in the high-end segment.
Ex: Royal City, Times City, Vinhomes Riversides, Vincom Village 2,...
=> Assessment: great potential for development due to abundant land funds and many projects being
implemented
+ Commercial leasing segment: Revenue and profit in this segment in recent years have not
fluctuated much. VIC's commercial projects are located in prime locations in major cities.

I estimate this segment's revenue and profit growth will be sustained over the long term given its
stable income-generating properties. In our view, this is a segment that plays an important role in
Vingroup's business by providing stable and reliable cash flow. In addition, the liquidity of
projects in this category is higher than that of housing projects.

+ Hotel and resort service: This business segment was merged into VIC in 2012 and most of the
operating projects have generated profits since 2012.
Ex: VInpearl resort Nha Trang, Vinpearl Land Nha Trang, …
This business segment provides a certain cash flow for Vingroup, but the liquidity of these
projects is not as high as commercial projects.
KẾT LUẬN
I rate Vingroup as a real estate company with high-quality business performance. Despite the
gloom of the high-end real estate segment, VIC has maintained very good sales progress for most
of its projects. We highly appreciate VIC's ability to effectively raise capital, which has helped
the company maintain good project development progress as well as its commitment to high
product quality. Currently, there are not many real estate enterprises possessing this competitive
advantage. At the same time, we also appreciate the commercial projects that VIC is leasing with
the current high occupancy rate. These stable income-generating assets will play a big role in
maintaining cash flow for the company as well as partially solving the liquidity problem. In
addition, we strongly believe in the executive ability of the company's board of directors, who
have extensive experience in managing domestic and foreign businesses.