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.
A preliminary report on the business results for the first nine months of 2024 estimates Vinatex’s consolidated revenue at VND 13,036 billion, a nearly 1% increase compared to the same period last year, and a pre-tax profit 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 exported only about 20 billion USD. However, the unstable situations in competing countries like Bangladesh and Myanmar subsequently created short-term advantages for Vietnam’s textile and garment industry.
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“Enterprises need to continue taking drastic actions, improve production capacity, and practice saving to ensure stable production and business operations, especially for material-producing enterprises that have been facing difficulties for the last 30 months”, emphasized Mr. Truong.
Tapping into a niche market with flame-retardant fabric
“The goal is to achieve 44 billion USD in exports in 2024, a 10% increase compared to 2023. Achieving this target largely depends on the 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 6 to 12 months have been highly inaccurate since 2022. Therefore, the biggest challenge for Vietnam’s textile and garment industry is the unpredictability of the situation.
“We may have some very good months, but right after that, there will be one or two very bad months”, said the leader of Vinatex. The market fluctuations since 2022 have taught the managers of the textile and garment industry an important lesson: always make shorter-term forecasts, update them more frequently, and make management decisions more quickly and flexibly to catch the waves of short-term growth in the global market.
Vinatex Chairman Le Tien Truong sharing at an event in May 2024
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To achieve its annual plan, Vinatex and its member companies have implemented their own solutions and strategies. One such approach is to venture into a niche market by trading and producing 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 the manufacturing process 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 cooperation, Vinatex set a target of USD 2-2.5 million in revenue for 2024 and aims to double this figure annually over the next five years. The primary goal is to meet the requirements of the US market, and from there, it will be easier to enter the markets of the EU, Japan, South Korea, and other markets worldwide”, shared Mr. Truong.
