The Board of Directors of Phu Nhuan Jewelry Company (PNJ) sets a target of achieving a net revenue of VND37,147 billion and a gross profit of VND6,543 billion this year, an increase of 12% and 8%, respectively, year-on-year. The after-tax profit is expected to reach VND2,089 billion, up 6%, maintaining the growth momentum for three consecutive years and setting a new record in the company’s operating history if achieved. Accordingly, the company plans to pay a cash dividend of 20%.
This year, PNJ’s Board of Directors aims for a 12% increase in net revenue. Photo: Thanh Nghia
According to PNJ’s management, this target is set amidst a challenging global and domestic economic landscape, particularly with the yet-to-recover purchasing power of the domestic retail sector. Sharing the same sentiment, many analyst groups also predict that the retail jewelry market and economy will face numerous short-term headwinds. For instance, in a report published in mid-March 2024, experts from MB Securities Joint Stock Company (MBS) predicted that the jewelry retail market this year would only recover by about 5% compared to the same period last year and that positive signals would only truly emerge during the second half of the year.
However, considering the medium and long term, this market holds significant potential due to the convergence of many factors, such as consumer stimulus policies, online shopping trends, public demand, and the rapid adaptation of businesses in the industry.
Mr. Le Tri Thong – CEO of PNJ said: “Instead of being defensive, we choose to be offensive, making every effort to keep our promises to shareholders.” Photo: Thanh Nghia
Therefore, most analyst groups believe that PNJ’s plan to maintain profit growth is feasible and even lower than their projections. Specifically, MBS experts expect PNJ to post an after-tax profit of VND2,353 billion this year, up 19% year-on-year and VND264 billion higher than the target. VCBS, with a more optimistic outlook, predicts an after-tax profit of up to VND2,395 billion, a 21.5% increase from 2023.
According to MBS, in its journey to solve the growth equation, PNJ has always had the advantage of being the leading enterprise in Vietnam’s jewelry retail market. Besides, PNJ has built a strong and reputable brand with 36 years of experience and the largest jewelry retail system in the country, boasting over 400 stores in 55/63 provinces and cities.
“We believe that PNJ will continue to expand its network and increase its store presence this year. The company still has prospects for expansion outside the North in the medium and long term, as the market penetration of jewelry retail there is still low,” shared MBS experts.
PNJ continuously expands its store network, diversifies product categories, and enhances production capabilities. Photo: Thanh Nghia
According to the PNJ representative, branding activities are also crucial to driving effective business growth. This belief stems from the company’s past success in implementing numerous customer engagement programs and shaping consumption habits during special occasions, significantly contributing to its profits in recent years.
Another factor that many securities companies believe can contribute to PNJ’s pursuit of new profit heights is the management’s ability to adapt to changing business conditions and find innovative ways to reach new customer segments.
In this year’s business orientation, PNJ’s management stated that one of the focal points is to strengthen market penetration, optimize revenue from key market stores by enhancing the quality of customer service. The company also focuses on improving design capabilities, researching new production technologies, and diversifying product categories to reach multiple customer segments.
Despite the decline in domestic consumer demand, Vietnam’s market is predicted to have growth potential. Photo: Thanh Nghia
In addition, PNJ also emphasized the importance of developing new business segments and experimenting with modern customer engagement models to create a comprehensive ecosystem and maintain its leading position in the jewelry retail market in the long run.
Beyond the short-term profit growth equation, PNJ commits to practicing sustainable development in line with the common goals of the Vietnamese government and contributing to the National Agenda for Sustainable Development 2030 in accordance with the United Nations’ 17 Sustainable Development Goals (SDGs). As planned, the company expects to allocate a budget of around VND10 billion to projects implementing its ESG commitments this year.
