CSV to Halt Tan Binh 2 Plant by Aug 15, 2026; New Plant Delayed to 2031

Overview

Southern Basic Chemicals Corporation (CSV), listed on HOSE with a market capitalization of nearly VND 2,400 billion, will cease all production at its Tan Binh 2 plant after August 15, 2026, to facilitate relocation from Bien Hoa 1 Industrial Park. The move follows a forced eviction order from local authorities as part of Đồng Nai province’s plan to convert the industrial park into an urban-commercial-service area. The new Nhon Trach plant is not expected to operate until December 2031, creating a significant production gap.

Key Facts

• CSV will stop all production at Tan Binh 2 plant after August 15, 2026.
• The forced eviction covers three land plots totaling over 82,300 m² in Trấn Biên ward, with enforcement from July 15 to December 31, 2026.
• CSV received a decision from the People’s Committee of Trấn Biên ward in mid-July 2026 regarding forced dismantling of assets due to incomplete relocation.
• The company is entitled to VND 195 million compensation for crops and a potential VND 8 million bonus if relocation is completed on schedule per Decision 1618 dated September 8, 2025.
• Dismantling and handover of the entire site is expected to be completed by October 2029.
• The replacement Nhon Trach plant has a total investment of VND 1,844 billion, with VND 632 billion in equity and VND 1,212 billion in loans.
• The Nhon Trach plant is expected to be completed and operational from December 2031.

What Happened

CSV announced it will halt all production at its Tan Binh 2 plant after August 15, 2026, to proceed with relocation to the new Nhon Trach plant. This follows a forced eviction decision issued by the People’s Committee of Trấn Biên ward in mid-July 2026, as the company had not completed dismantling and land handover as required. The eviction applies to three land plots totaling over 82,300 m², with enforcement running from July 15 to December 31, 2026.

The relocation is part of Đồng Nai province’s broader plan to convert Bien Hoa 1 Industrial Park—originally established in 1963—into an urban, commercial, and service area, citing deteriorating infrastructure and environmental risks to the Đồng Nai River. CSV’s management stated at the 2026 annual general meeting that the company would receive VND 195 million in crop compensation and a potential VND 8 million bonus for timely relocation. The company plans to complete dismantling and site handover by October 2029, with some production lines already halted to facilitate equipment removal.

Market Context

CSV shares closed at VND 21,700 on August 3, 2026. The stock has been under pressure as the market digests the prolonged production disruption. The halt at Tan Binh 2, which is a key production facility, will likely impact CSV’s revenue and earnings until the Nhon Trach plant comes online in December 2031. This creates a multi-year gap in production capacity, raising concerns about the company’s ability to maintain market share and financial stability. The broader Vietnamese chemical sector has also faced headwinds, with peers like Đức Giang Chemical experiencing significant stock declines.

Strategic Significance

For long-term investors, the forced relocation represents a critical strategic challenge for CSV. The company is losing its existing production base without a clear timeline for replacement, as the Nhon Trach plant is not expected to operate until December 2031. This creates a prolonged period of reduced output, which could lead to loss of customers and market share to competitors. The compensation package appears minimal relative to the scale of disruption, and the company’s ability to manage the transition will be key. The new plant’s investment of VND 1,844 billion, funded partly by debt, adds financial risk. Investors should assess CSV’s liquidity and ability to sustain operations during the interim period.

What to Watch

• Progress on the Nhon Trach plant construction and any updates on the timeline for completion.
• Quarterly earnings reports to gauge the financial impact of the production halt.
• Any additional compensation or support from local authorities beyond the stated amounts.
• Management’s plans to mitigate revenue loss, such as outsourcing or temporary production arrangements.
• Regulatory approvals and permits for the new plant, which could affect the December 2031 target.