This information was shared by Le Tien Truong, Chairman of the Board of Directors of the Vietnam Textile and Apparel Group (Vinatex, UPCoM: VGT), at a Party Executive Committee Conference held last week.
In a preliminary report on the business results for the first nine months of 2024, Vinatex estimated consolidated revenue of VND 13,036 billion, a nearly 1% increase compared to the same period last year, and pre-tax profits of VND 490 billion, an over 70% surge. With these results, the Group has achieved nearly 73% of its revenue target and more than 89% of its profit goal for the year.
According to Vinatex Chairman, Le Tien Truong, the market context in 2024 remains challenging and unstable. The only difference between 2024 and 2023 is that the market conditions have improved quarter by quarter.
In the first six months of 2024, the entire textile and garment industry only exported approximately $20 billion. However, subsequent instability in competing countries like Bangladesh and Myanmar created short-term advantages for Vietnam’s textile industry.
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“Businesses need to continue taking decisive actions, improve production capacity, and practice savings to ensure stable production and business operations, especially for those producing raw materials who have been facing difficulties for the past 30 months”, emphasized Mr. Truong.
Tapping into a niche market with flame-retardant fabric
“The goal is to achieve $44 billion in exports in 2024, a 10% increase from 2023. Achieving this target largely depends on market signals in the fourth quarter of 2024″, remarked Chairman Le Tien Truong in a recent article on the Vinatex website.
Based on his experience, Mr. Truong observed that long-term forecasts of six months to a year have been highly inaccurate since 2022. Therefore, the biggest challenge for Vietnam’s textile industry is the unpredictability of the market.
“We may have some very good months, but immediately after that, there could be one or two very bad months”, said the head of Vinatex. The market fluctuations since 2022 have taught the industry’s managers an important lesson: always make shorter-term forecasts, update them frequently, and make management decisions more quickly and flexibly to ride the waves of short-term growth spurts in the global market.
Vinatex Chairman Le Tien Truong sharing at an event in May 2024
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To meet its annual plan, Vinatex and its member companies have implemented various solutions and strategies. One such approach is to venture into niche markets by trading in and manufacturing flame-retardant clothing, thereby increasing the value of their products.
To this end, Vinatex has entered into a joint venture with the Coats Group to invest in the production of flame-retardant fabric. They are currently expediting manufacturing and plan to export the first orders to Indonesia, India, the Middle East, and the USA in the third quarter and the beginning of the fourth quarter.
“For this collaboration, Vinatex aims for a revenue target of $2-2.5 million in 2024 and expects to double this figure annually over the next five years. The primary goal is to meet the demands of the US market, and from there, we will expand to the EU, Japan, South Korea, and other global markets”, shared Mr. Truong.
