The Revamped Title: “Bầu Đức: The Inevitable Mention of Debt When Discussing Hoàng Anh Gia Lai”

Pivoting to a 4-Tree, 1-Animal Model

On June 6th, Lai Joint Stock Company (stock code: HAG) held its 2025 Annual General Meeting.

Speaking at the event, Mr. Doan Nguyen Duc (known as “Bầu Đức”), Chairman of HAG’s Board of Directors, stated that in the past, whenever Lai was mentioned, people would associate it with debt. Even though the company has mostly recovered today, potential partners are still indifferent or even dismissive.

“We have been working hard to reduce our debt and clear accumulated losses for the past nine years, and we are almost there. ai will have an extremely positive financial report by the end of this year,” Bầu Đức assured.

Addressing a shareholder’s question about why the company didn’t increase its area in 2024 to ensure compatibility and stability between sales software and e-invoices/accounting software, as well as to prevent similar incidents from recurring, and why it didn’t rebuild its pig herd in time, Bầu Đức explained that they had initially planned to expand their banana area but had to reconsider due to financial constraints and difficulties in capital mobilization.

The same issue applied to their pig business. Due to capital constraints, they had to pause for a year, resulting in low pig sales despite favorable market prices. Lai has now started to rebuild its pig herd, a process that will take almost a year before sales can pick up again by the end of this year or early 2026.

This year, Bầu Đức announced that they would invest in 2,000 hectares of mulberry, a new crop that the company started experimenting with in 2024. Theoretical and practical indices have been refined, and has also invested in a silk factory, which was completed four days ago.

“On one hectare of land, mulberry will outperform all other crops we’ve tried. We will plant 2,000 hectares of mulberry this year for sericulture and silk export. We are also investing in 2,000 hectares of Arabica coffee, as its price has reached $9,000 per ton, almost double that of regular coffee. These are our two major programs,” Bầu Đức shared.

As part of their strategy to reach 30,000 hectares by 2030, ai will allocate 2,000 hectares for sericulture and 4,000 hectares for Arabica coffee. They plan to plant 2,000 hectares of mulberry and 2,000 hectares of coffee this year, followed by an additional 2,000 hectares of coffee next year to complete their raw material source. If all goes according to plan, the coffee trees will start bearing fruit from 2027 onward, providing a stable cash flow and high profits.

“I’m sharing this not to boast. If no shareholder had asked, I wouldn’t have mentioned it. I prefer to act first and speak later. But today, I feel it’s necessary to clarify that is transforming, restructuring, and investing in strategic, valuable endeavors, not following trends or impulses. I assure you that everything I’ve mentioned today has been, is being, or will be done with the highest determination,” Bầu Đức emphasized.

Regarding dividend distribution, Bầu Đức acknowledged the challenges the company has faced since 2016 and requested shareholders’ patience for one more year. Their primary goal over the past eight to nine years has been to minimize debt. Bầu Đức projected that they would aim for a post-tax profit of VND 5,000 billion by 2028.

He also provided an update on their sturgeon project in Laos, where they are currently rearing 700,000 fish as a pilot. The first batch of fish is expected to be sold in September or October, with final conclusions likely by the end of the year.

Currently, is operating with a 2-tree, 1-animal model, which Bầu Đức believes is risky. Hence, they have added mulberry and coffee, resulting in a 4-tree, 1-animal model with five product lines. For example, if the Chinese market affects durian sales, there are still mulberry and coffee.

Leaving the Dark Times Behind

On special incentives for key personnel, Bầu Đức acknowledged the extremely challenging period experienced from 2016 onward and expressed gratitude for the dedication and unity of their staff, which helped them overcome those dark times. Their debt has now been reduced to VND 3,000-4,000 billion, a hard-won achievement.

“I think this way: has survived since 2016 despite liquidity issues. This is a collective effort, not an individual one. Finding a bank or securities company director in Ho Chi Minh City is not difficult, but finding a farm director is extremely challenging. They need both qualifications and a willingness to sacrifice. They work in remote areas without a car, far from their families, only reuniting once a year,” Bầu Đức explained.

Recalling the difficult period in 2016-2017 when the company couldn’t pay salaries for five months, Bầu Đức expressed his gratitude for the staff’s loyalty. He stated that even if shareholders didn’t approve, he would use his own money to compensate the employees. Without these dedicated individuals, would not have survived the past decade, and they remain crucial to the company’s five-year strategy.

As a result, HAG will issue 12 million ESOP shares to employees who have contributed for at least ten years. The transfer of these shares will be restricted in phases: 10% transferable after three years from the issuance date, an additional 10% after four years, and fully transferable after five years.

Regarding the plan to issue 210 million shares to convert bond debt, Bầu Đức confirmed that HAG would immediately reduce its debt by VND 4,000 billion. He pledged that after the issuance, HAG would not distribute shares to avoid dilution, as was done previously.

This year, HAG aims to achieve revenue of over VND 5,500 billion, a decrease of about 5% from the previous year. The largest contributor is expected to be the fruit segment (bananas and durians) at 76%, followed by the pig business at 19%, with the remaining coming from other goods. The company targets a post-tax profit of over VND 1,100 billion, a 5% increase, and this will be the fourth consecutive year of achieving profits above VND 1,000 billion if successful.