Enterprises expect to "take off" in 2024

Producing auto components at THACO's factory. Photo: Internet

Impressive goals

In a recent message to employees, Tran Ba Duong, Chairman of the Board of Directors of Truong Hai Auto Corporation (THACO), outlined specific goals for the company's various activities. Among them, THACO Industries will continue to invest in and put into operation new factories in Chu Lai, including a high-end automotive glass factory; automotive frame and body parts factory; and automotive interior complex.

In particular, the company plans to establish and operate a sales company in the US for the North American market (including the US, Canada, and Mexico), establish and manage two representative offices in Europe and Australia to support existing customers and develop markets. THACO Industries aims to achieve consolidated revenue of VND13,000 billion in 2024, with export revenue of US$250 million.

For THACO Auto, in 2024, new products will be developed, introduced and launched nine models of passenger cars, 13 models of trucks, and six models of buses under the THACO brand. Simultaneously, investment will be made in building a new R&D center on a larger scale, with synchronized and modern equipment to meet the technological development requirements in automobile manufacturing and assembly. THACO Auto's sales target in 2024 is 95,400 vehicles of all types, accounting for 38% of the domestic automobile market share; and exporting over 1,600 vehicles. Consolidated revenue is expected to reach VND68,400 billion.

In the agricultural sector, THACO Agri aims for consolidated revenue of VND6,600 billion in 2024, with export revenue of US$190 million. In logistics (THILOGI), the plan for 2024 is to transport more than 20,100 containers of fruits and agricultural materials. Implementing transportation services on inland waterways for over 46,600 containers and international routes with 56,600 containers. The total cargo throughput at Chu Lai port is estimated to reach five million tons, an increase of 62% compared to 2023. The total consolidated revenue for 2024 is expected to reach VND3,800 billion.

Overall, the target revenue for all business sectors of THACO in 2024 will reach nearly VND100,000 billion.

Hoa Binh Construction Group (HBC) has also announced its plan for 2024 with revenue of VND10,800 billion and after-tax profit of VND433 billion, while the company incurred losses of VND545 billion and VND2,079 billion in 2023 and 2022, respectively. Since the fourth quarter of 2023, HBC's business results have been outstanding with after-tax profit of VND101 billion, breaking the streak of consecutive losses in the previous four quarters. The company is also ramping up its business activities as the real estate market heats up. At the end of December 2023, HBC signed a contract for the design and construction of a social housing project in Hai Phong City with a total contract value of nearly VND fou4,000 billion. Most recently, HBC won bids for five projects in Kenya, including 3,400 apartments, with a total investment of about US$72 million.

Many other companies have also set impressive growth plans for 2024 such as Dabaco Group aiming for total revenue in 2024 to reach VND25,380 billion, and after-tax profit of nearly VND730 billion - 29 times higher than in 2023. Digital World Corporation (Digiworld) is expected to achieve revenue of VND23,000 billion and after-tax profit of VND490 billion, representing an increase of 22% and 38% respectively compared to 2023.

Expectation of "taking off"

In the strategic report for 2024 just released by SSI Securities Company, experts believed that the Vietnamese economy would rebound in 2024 with traditional growth drivers such as trade, public investment, and growth-supporting policies being the government's top priorities. One of the biggest catalysts for 2024 is the strong political, which will be potential for economic growth in 2024. In fact, upon closer examination of the National Assembly's Resolution 2024, this is the first time after a long period of prioritizing growth over macroeconomic stability, indicating the potential for loosening fiscal and monetary policies.

In 2023, a series of roadmaps and legal frameworks were issued with the aim of "transforming" the economy in the medium and long term, including the National General Plan for the 2021-2030 period (Resolution 81/2023), the VIII Electricity Development Plan, the Resolution on global minimum tax (GMT), and laws related to land. Therefore, 2024 is expected to be a year for "taking off" for implementation and execution. Vietnam enters 2024 with ample room to stimulate domestic demand, with public debt estimated at around 39% - 40% of GDP (much lower than the government's ceiling of 60%). The government is also actively expanding revenue sources from taxes (Decision 508/2022/QD-TTg on tax system reform), and the IMF estimated that Vietnam's fiscal balance would fall into a slight deficit during the economic restructuring process, including wage reform.

Compared to countries in the region, Vietnam's government debt is at a manageable level and is among the lowest in the region as the government did not push spending too strongly during the Covid-19 period. Therefore, the possibility for the Vietnamese government to continue expanding fiscal policies throughout 2024 to support the economy is entirely reasonable.

From the perspective of enterprises, many important policies are also being implemented to cope with market fluctuations. According to MWG's leadership, in 2024, the company chooses to proactively adapt to the changing business environment and not to have high expectations for optimistic purchasing power recovery at this stage. Accordingly, MWG will comprehensively restructure, reduce quantity, increase quality to enhance internal strength, ready to break through for sustainable growth. MWG also outlines business activities aligned with sustainable development goals (ESG). Digiworld will expand into various other business areas such as distributing Xiaomi air conditioners, refrigerators; exclusive distribution of Poly brand specializing in providing direct learning support devices; and Vietmoney pawnshop chain.

Meanwhile, at THACO, Tran Ba Duong stated that the company will focus on perfecting and upgrading management to improve business efficiency, while continuing to promote the application of information technology, moving towards developing digital platforms to complete digital transformation by no later than 2027.