Dragon Capital sells over three million Hoa Sen shares

A worker checks products at a warehouse of Hoa Sen Group. Photo courtesy of the company

HÀ NỘI — Despite the recovery of the steel industry, the foreign fund Dragon Capital has significantly divested a large number of Hoa Sen Group’s shares (HSG) since mid-March.

In an announcement on the Hồ Chí Minh Stock Exchange (HoSE), Dragon Capital disclosed it was selling over 3.17 million HSG shares on August 16, reducing its stake from 50.7 million shares to 47.5 million shares.

Despite Hoa Sen’s recent strong financial performance, the foreign fund has steadily divested from the company. Its net sales of HSG shares totalled over 28 million units from March 15 to August 16, decreasing their ownership from 12.3 per cent to 7.71 per cent.

In the third quarter of fiscal year 2023-2024, Hoa Sen saw a revenue increase of over 25 per cent to VNĐ10.84 trillion (US$434.6 million) and a profit after tax of VNĐ273 billion, nearly 20 times higher than before.

For the first nine months of the fiscal year, the steel producer’s revenue rose by 24 per cent to more than VNĐ29.1 trillion, with a profit after tax of VNĐ696 billion compared to a VNĐ410 billion loss in the same period last year.

The steel industry still faces several challenges.

In a recent industry report, Vietcombank Securities (VCBS) said that steel prices might struggle to rise due to sluggish demand in China, where the housing market remains tepid.

A significant hurdle arose from the export sector. While hot-rolled coil (HRC) exports surged in 2023 and in the first quarter of 2024, they declined in Q2.

That was mainly due to domestic production recovery in import markets and increased protectionism for HRC in the European Union (EU).

The bloc’s introduction of the Carbon Border Adjustment Mechanism (CBAM), applying carbon taxes to exports, is scheduled to start in January 2026, posing a challenge for local producers requiring eco-friendly investments for continued EU exports.

Meanwhile, the EU’s anti-dumping probe on Vietnamese HRC steel and similar investigations could also hamper export volumes.

On August 8, the European Commission (EC) initiated an anti-dumping investigation on HRC coming from Egypt, India, Japan and Việt Nam.

HSG shares closed on Thursday at VNĐ20,750 a share, down 1.43 per cent from the previous session. — VNS