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 the Party Executive Committee Conference held last week.
According to 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 target for the year.
“The context of the market in 2024 remains challenging and unstable. The only difference between 2024 and 2023 is that the market conditions have improved quarter by quarter,” said Chairman Le Tien Truong.
In the first six months of 2024, the entire textile and garment industry only exported about 20 billion USD. 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, enhance production capacity, and practice savings to ensure stable production and business operations, especially for material-producing enterprises that have been facing difficulties for the past 30 months,” emphasized Mr. Truong.
Tapping into a niche market with flame-retardant fabric
To achieve the export target of 44 billion USD in 2024, a 10% increase compared to 2023, Mr. Le Tien Truong noted in a recent article on the Vinatex website that “it heavily depends on the market signals in the fourth quarter of 2024.”
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 and garment industry is the unpredictability of the market.
“We may have some very good months, but right after that, there could be one or two very bad months,” said the leader of Vinatex. The market fluctuations since 2022 have taught the industry’s managers an important lesson: always make shorter-term forecasts, stay updated, and make quicker and more flexible management decisions to ride the waves of short-term growth spurts in the global market.
Chairman of the Board of Directors of Vinatex Le Tien Truong sharing at an event in May 2024
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To meet the year-end plan, Vinatex and its member companies have implemented their own solutions and strategies. One such approach is to venture into niche markets and increase product value by trading in and manufacturing flame-retardant clothing.
To this end, Vinatex has entered into a joint venture with the Coats Group to invest in flame-retardant fabric production. They are expediting manufacturing and expect 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 USD 2-2.5 million in 2024 and a doubling of that 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.
