Mobile World seeks a way to solve the growth challenge.

Setting a target of 150,000 billion VND in net revenue and 4,850 billion VND in after-tax profit, Mobile World Investment Corporation also outlined a substantial growth plan for its core retail chains.

Accelerate to regain form.

Compared to 2023, the business results of Mobile World Investment Corporation (MWG) in 2024 showed a strong breakthrough. Net revenue from sales and services reached VND 134,341 billion, an increase of 13% compared to 2023. The gross profit margin improved, bringing the gross profit to VND 27,499 billion, equivalent to a growth of 22%.

Of this total, revenue from mobile phones, computers, and electronics reached VND 91.1 trillion, while revenue from food and fast-moving consumer goods reached VND 41.088 trillion, accounting for 67% and 30% respectively. However, the food and fast-moving consumer goods segment had a significantly higher gross profit margin of 24%, compared to only 18% for the electronics segment. As a result, after-tax profit for the year reached VND 3.733 trillion, 22 times higher than the previous year.

Profits in 2024 showed high growth, but in reality, this was due to a sharp decline in Mobile World's profits in 2023. Compared to the 2021-2022 period (when profits were consistently above 4,000 billion VND), the company has yet to regain its momentum.

In 2024, Mobile World Group set a not-too-ambitious target, with a revenue plan of VND 125,000 billion and after-tax profit of VND 2,400 billion. In just 9 months, the company exceeded its targets. After-tax profit for the whole year exceeded the target by more than 55%.

After a year of recovery, Mobile World Group has set ambitious goals for a comeback, aiming for net revenue of VND 150,000 billion and after-tax profit of VND 4,850 billion, representing a 30% increase in profit. This plan is close to reaching the record profit figure of 2021.

Considering the revenue structure by chain, the Dien May Xanh and Bach Hoa Xanh chains are contributing the largest share of revenue, with percentages of 44.3% and 30.6% respectively in 2024. In terms of product categories, phones, accessories, and other mobile devices account for 35.1% of revenue, while fresh food and FMCG contribute 30.6%.

A series of plans for chain stores.

Thegioididong.com has revealed a series of plans for its retail chains. Specifically, for the Thegioididong.com chain (including Topzone) and Dien May Xanh, the company aims for revenue growth exceeding 4 trillion VND, despite unfavorable market conditions. The company will not expand offline stores, will consider replacing existing stores, and will focus on optimizing and increasing revenue for existing stores.

On the online channel, The Gioi Dien May (Mobile World) will build a shopping destination for technology and electronics with a diverse product range, focusing on services. Regarding the Topzone chain, the company identifies it as a strategic bridge between the company and Apple to realize the goal of $1 billion in revenue from Apple retail sales across its chains by 2027.

Mobile World Group has set ambitious goals for its Bach Hoa Xanh chain, aiming to become Vietnam's leading food and consumer goods retail chain, achieving $10 billion in revenue before 2030. Specifically for 2025, the target is to increase revenue by at least VND 7,000 billion, open 200-400 new stores, and achieve a minimum 300% growth in online sales compared to 2024. While the chain began generating profits in 2024, its accumulated losses currently exceed VND 8,651 billion.

Other retail chains are also expected to experience strong growth by Mobile World, such as the Avakids chain with a revenue target of over 10%, the Erablue chain with a revenue increase of over 50%, and the An Khang Pharmacy chain, which expects to break even in Q2/2025. These figures demonstrate Mobile World's ambition to increase market share, but the feasibility remains questionable and has received varying forecasts from analysts.

SSI Securities Company is quite cautious when considering Mobile World's target figures. Regarding the $10 billion revenue target set for the Bach Hoa Xanh chain, SSI assesses this as a rather ambitious figure given the current modest pace of new store openings and the mini-supermarket model.

Mobile World's 2025 revenue and profit plan shows that profits from technology and electronics products will remain at the same level as the previous year amidst a slow consumer recovery. SSI believes that, despite the slow pace of consumer recovery, Mobile World's suitable business model, along with the expected phone replacement cycle, will drive significant profit growth in 2025. However, a downward adjustment to the 2025 profit estimate may be necessary due to weaker-than-expected consumer growth.

Meanwhile, Shinhan Securities projects Mobile World's revenue and profit to be higher than the company's plan. Specifically, this securities firm projects Mobile World to achieve VND 150,628 billion in revenue and VND 5,010 billion in after-tax profit. This is a record profit level for Mobile World and 3% higher than planned.

Impact from the trend of tightening consumer spending.

According to PwC's 2024 consumer survey, Vietnamese consumers are still being affected by rising prices of food, energy, housing, and other essential goods, significantly impacting their spending. 64% of respondents indicated they still allocate the majority of their spending to food, and 48% to healthcare. Conversely, 33% said they would cut back on luxury goods, and approximately 30% would reduce purchases of non-essential items.

Source: https://baodautu.vn/the-gioi-di-dong-tim-loi-di-giai-bai-toan-tang-truong-d250391.html