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Hoa Phat Group (HPG VN) – FY 2025 Earnings – Profit Surges 28.5% as Steel Demand Rebounds
Summary of FY 2025 results and outlook of Hoa Phat Group JSC (HPG VN)
- Total sales volume of Vietnam’s steel producers increased 10.8% y/y to 32.1mn tons as strong domestic demand offset export challenges amid escalating global protectionism. Specifically, domestic consumption surged by 31.8% y/y supported by accelerating public investment, a new wave of residential projects and strong industrial production activities. In contrast, exports fell 37.2% y/y due to heightened trade barriers and new tariffs. Following the official enforcement of anti-dumping (AD) duties on Chinese HRC imports, which led to a sharp decline in inflows in H2/2025, the Ministry of Industry and Trade’s (MoIT) newly initiated anti-circumvention investigation is expected to further support domestic producers.
- HPG’s net revenue rose 12.4% y/y in 2025, as robust sales volume growth was partly offset by softer selling prices. The steel segment, accounting for 93.7% of total sales, recorded a 27.8% y/y increase in volume to 11.8mn tons. Growth was primarily driven by a 73.5% y/y surge in HRC sales, supported by the commissioning and ramp-up of the Dung Quat Steel Complex Phase 2 (DQSC2), while output demand benefited from AD protection. Other key products, including construction steel and steel pipes also maintained solid volume growth. Gross profit margin expanded to 15.7%, from 13.3% in 2024, supported by a sharp decline in input costs relative to selling prices, although still partly constrained by the low initial utilization of DQCS2, suggesting further room for improvement. Meanwhile, net financial expenses jumped 87.1% y/y, mainly due to the full recognition of interest expenses as DQCS2 became operational. Overall, net profit surged by 28.5% y/y to VND15.5tn.
- DQSC2 became fully operational as the second blast furnace began contributing commercially in December 2025. The project was delivered in line with the original investment timeline, underscoring HPG’s strong execution capability. From 2026, HPG’s total capacity reaches 16mn tons, placing the group among the world’s top 30 steel producers. Within this capacity, the share of construction steel declines to around 40%, while HRC and higher-quality steel products account for approximately 60%, reflecting the company’s continued strategic shift up the value chain.
Read our previous analysis on HPG’s quarterly earnings.
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