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Vietnamese textile companies are expected to achieve digit growth

The strong recovery of the global textile and apparel market, coupled with the advantages of free trade agreements, has allowed many Vietnamese textile and apparel companies to set high-growth goals. Vietnam Te…

The strong recovery of the global textile and apparel market, coupled with the advantages of free trade agreements, has allowed many Vietnamese textile and apparel companies to set high-growth goals.

Vietnam Textile and Apparel Association (VITAS) stated: Even though the COVID-19 epidemic is still developing in a complex and unpredictable way around the world, Vietnam has a safe and flexible response policy and has Effectively controlling the epidemic has enabled economic recovery and sustained development; major markets such as the United States and the European Union have reopened; and a new generation of free trade agreements have taken effect, giving Vietnamese textile and garment companies more opportunities to expand the market.

Ambitious goals

Dap Cau Garment Joint Stock Company recently “completed “The business plan for 2022 aims to achieve overall corporate revenue of VND750 billion (approximately US$32.48 million), profit of VND22.5 billion (approximately US$970,000), and a dividend of 20%. Compared with the production and operating results in 2021, this goal is quite ambitious; in 2021, the company’s revenue will be 478 billion VND (approximately US$20.57 million), and its profit will exceed VND21 billion (approximately US$910,000) (an increase of 40% from 2020). %).

When the COVID-19 epidemic broke out in Bac Ninh and Bac Giang in 2021, Dap Cau Garment Company was forced to close its production factory for nearly 2 months , once faced the risk of not being able to complete the planned plan. However, after the resumption of production, revenue increased rapidly, not only maintaining profits but also growing strongly.

Xing’an Garment Co., Ltd. (Hugaco), which has more than 10 membership systems, encountered unfavorable production conditions in the first four months of 2021, and the unit price of orders fell. , processing prices dropped by 20-40%, logistics costs increased sharply, and the U.S. dollar depreciated by 3% against the Vietnamese Dong, resulting in Hugaco’s revenue decreasing by 15 billion VND (approximately US$650,000). After overcoming the difficulties, Hugaco’s operating income in 2021 reached VND708.7 billion (approximately US$30.69 million), completing 122% of the target; pre-tax profit reached VND84.1 billion (approximately US$3.64 million), equivalent to 117% of the target. Based on this operating results and market assessment, Hugoco has set the goal of total revenue of 750 billion VND (approximately US$32.48 million) and pre-tax profit of VND80 billion (approximately US$3.46 million) in 2022.

However, the challenges are not over yet, and we still have to face the impact of the new crown epidemic and the Russia-Ukraine conflict. However, it is confirmed that revenue increased by more than 10%, reaching 3.8 trillion VND (approximately US$160 million), and pre-tax profit reached 120 billion VND (approximately US$5.2 million), an increase of nearly 30 billion VND (approximately US$1.3 million) compared with 2021. ), Garment 10 Joint Stock Corporation still set ambitious goals.

ThanDucViet, general manager of Garment 10, said that compared with 2019 (before the new crown epidemic), the outbreak of the new crown epidemic in 2021 will seriously affect the company’s production and business activities. Sleeveless vests (veston) order quantity decreased by 54%. In addition, logistics costs, freight rates continue to rise, container shortages, and labor competition become increasingly fierce, all of which increase corporate costs. However, Garment 10’s revenue in 2021 still reached 3.5 trillion VND (approximately US$150 million), and its pre-tax profit was 91.57 billion dong (approximately US$3.97 million), an increase of 12.5% ​​compared with 2020.

Even though the COVID-19 epidemic is not over yet, due to the high coverage of vaccines, production and commercial activities have gradually become active; however, the “price storm” chain reaction caused by the Russia-Ukraine conflict , is expected to have a direct and long-term impact on the global production and supply chain, and Vietnam will also be affected.

In addition, countries with great textile and clothing export potential, such as India and Bangladesh, are expanding exports. Some Southeast Asian countries have also given priority to the development of textile and clothing. Therefore, this industry will still become a major factor in the economic development of various countries. The focus of competition. However, one of the advantages of Vietnam’s textile industry is that the country has signed and implemented a series of free trade agreements, which has increased the market share of enterprises in major markets such as Europe, Japan, and the United Kingdom, and at the same time opened up access to the markets of Russia, Australia, South Korea, and China. ‘s door.

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Author: clsrich

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