HAG signs MOU with Laos province to plant 5,000 ha coffee, targets 20,000 ha total

Overview

Hoang Anh Gia Lai Group (HAG) signed a memorandum of understanding with Champasak province in Laos on May 10, 2025, to plant 5,000 hectares of coffee and build a processing plant on the Bolaven Plateau. The project is part of HAG’s broader strategy to expand its total coffee raw material area to over 20,000 hectares across Vietnam, Laos, and Cambodia, aiming to become the world’s leading coffee grower by area.

Key Facts

• HAG signed an MOU with Champasak province, Laos, on May 10, 2025, to plant 5,000 ha of coffee and build a processing plant.
• The project targets high-quality coffee for export to global markets.
• HAG aims to raise its total coffee area to over 20,000 ha across Vietnam, Laos, and Cambodia.
• In April 2025, HAG completed a VND 2,000 billion bond issuance (code HAG12601, 36-month tenor) to fund its coffee expansion.
• The bond was rated A by Fiin Ratings and guaranteed by Orient Commercial Bank (OCB).
• HAG is currently the second-largest agricultural production and processing enterprise in Vietnam.
• The MOU was witnessed by the Consul General of Laos in Da Nang, the Party Secretary of Champasak, and leaders of Gia Lai province.

What Happened

On May 10, 2025, Hoang Anh Gia Lai Group, led by Chairman Doan Nguyen Duc (known as “Bau Duc”), signed a memorandum of understanding with the leadership of Champasak province in Laos. The MOU covers the planting of 5,000 hectares of coffee and the construction of a processing plant on the Bolaven Plateau, with the goal of producing high-quality coffee for export. The signing was witnessed by the Consul General of Laos in Da Nang, the Party Secretary of Champasak, and leaders of Gia Lai province.

At the ceremony, Mr. Alounxay Sounnalath, Party Secretary of Champasak, stated that the provincial government would facilitate and cooperate closely with HAG in high-tech agricultural investment. Mr. Nguyen Huu Que, Vice Chairman of Gia Lai province, noted that the investment would boost local economic development and concretize cooperation agreements between the two provinces. Chairman Doan Nguyen Duc emphasized the need for land support, saying, “I believe that today we meet as people who say and will do.”

Market Context

HAG is listed on HOSE and has been transitioning from real estate to agriculture over the past decade. The company is currently the second-largest agricultural producer in Vietnam, with significant operations in Laos, Cambodia, and Thailand, focusing on fruit crops such as bananas, jackfruit, mangoes, and durian. The coffee expansion aligns with HAG’s strategy to scale up its agricultural footprint in the Indochina region. The VND 2,000 billion bond issuance in April 2025, rated A by Fiin Ratings and guaranteed by OCB, provides financial backing for the expansion. HAG’s stock price has been volatile amid sector headwinds and company-specific developments.

Strategic Significance

The MOU with Champasak represents a concrete step in HAG’s ambition to become the world’s largest coffee grower by area, leveraging the favorable climate and soil of the Bolaven Plateau. By expanding its coffee area to over 20,000 hectares across three countries, HAG aims to achieve economies of scale and secure a leading position in the global coffee supply chain. The project also strengthens HAG’s presence in Laos, where it already has substantial agricultural investments. The bond issuance with a credit rating and bank guarantee indicates improved financial discipline and access to capital markets, which is critical for funding large-scale agricultural projects.

What to Watch

• Progress on land allocation and regulatory approvals from Champasak province.
• HAG’s Q2 2025 earnings report for updates on coffee planting progress and financial health.
• Any additional bond issuances or capital raises to fund the 20,000 ha target.
• Coffee production milestones and export contracts as the new areas come online.
• Changes in global coffee prices and their impact on HAG’s revenue projections.