HSG Flash note – NOT RATED

HOA SEN GROUP JSC (HSG VN)

Hoa Sen Group (HSG, fiscal year (FY): Oct 1, 2025 – Sep 30, 2026) held its 2026 AGM on 03/07/2026 with the following highlights:

1. 2026 Business Plan: HSG adopted a cautious business plan for FY2026, as the global coated steel market faces oversupply, rising trade protectionism, and weakening demand. The company will maintain production capacity at 2 mn tons per year, without expansion, and expects profit to decline from FY2025 levels under both planning scenarios. (details in the report).Amid higher interest expenses, management views FY2026 as a consolidation year, focusing on cost optimization, technology upgrades, and expansion of the Hoa Sen Home (HSH) retail network to prepare for the next growth cycle.
2. Restructuring of Hoa Sen Home and Hoa Sen Plastics:+ Hoa Sen Home: Shareholders approved increasing Hoa Sen Home’s capital from VND1,000 bn to VND3,000 bn through the issuance of 200 mn shares to HSG. HSH will manage the Group’s domestic distribution network and expand the HSH building materials and interior retail chain nationwide, with a target IPO within five years.

   + Hoa Sen Plastics: HSG will upgrade production lines to enhance automation and reduce costs, while seeking strategic investors and considering convertible bond issuance to diversify funding. The company is also exploring investments in transport infrastructure, industrial parks, and residential real estate.

3. Cancellation of treasury share buyback plan: The AGM approved the cancellation of the treasury share buyback plan proposed in FY2025, allowing the company to reallocate capital toward core investment projects.
4. Dividend Plan: Shareholders approved a 30% stock dividend, compared with 5% cash dividend in the previous year.Quick comment: The coated steel sector is expected to face ongoing headwinds in 2026, as external demand remains weak and protectionist policies persist. Nevertheless, a rebound in public investment and residential construction could support domestic consumption. Over the longer term, HSG’s Hoa Sen Home retail chain is anticipated to become a key growth driver, with plans to expand its network to 600 stores, up from 130 stores and over 400 distribution points currently.