Nagakawa (NAG) Posts Record Q1 Profit, Targets Record 2025 Revenue of 4,000 Billion VND

Overview

Nagakawa Group (NAG), the only listed air conditioner manufacturer on the Hanoi Stock Exchange (HNX), reported record Q1 2025 results with net profit of 16.4 billion VND (+20% YoY) and revenue of 1,081 billion VND (+12% YoY). The company targets record full-year revenue of 4,000 billion VND and net profit of 42 billion VND, driven by its niche strategy in commercial air conditioners and expanded distribution channels.

Key Facts

• Q1 2025 revenue reached 1,081 billion VND, a record high and up 12% YoY.
• Q1 net profit was 16.4 billion VND, up 20% YoY, the highest quarterly profit ever.
• Gross profit rose 21% YoY to 101 billion VND, with gross margin at 9.36%.
• Full-year 2025 targets: revenue of 4,000 billion VND and net profit of 42 billion VND, both record levels.
• After Q1, the company achieved 27% of the revenue target and 39% of the profit target.
• Air conditioners account for approximately 70% of Nagakawa’s revenue.
• The company is rebranding its name to “Naga” in 2025.

What Happened

Nagakawa Group (NAG) released its Q1 2025 financial statements, showing record quarterly revenue of 1,081 billion VND and net profit of 16.4 billion VND, the highest in the company’s history. Management attributed the growth to improved sales programs, pricing policies, discounts, and after-sales services that boosted sales volume. Cost of goods sold grew slower than revenue, allowing gross profit to increase 21% YoY to 101 billion VND, with a gross margin of 9.36%.

The company also reported other financial income of 598 million VND, down nearly 57% from the prior year. Operating expenses increased, mainly due to higher outsourcing costs, interest expenses, and employee costs. Despite these increases, net profit still grew 20% YoY.

Market Context

Nagakawa (NAG) is listed on the Hanoi Stock Exchange (HNX) and is the only listed pure-play air conditioner manufacturer in Vietnam. The company has historically faced intense competition from approximately 100 air conditioner brands, low margins due to price pressure from Chinese imports, and limited distribution networks. However, in recent years, Nagakawa has shifted focus to commercial air conditioners as a niche market, which has improved its competitive position. For residential products, the company has strengthened partnerships with major retail chains like Dien May Xanh and other northern supermarket chains, targeting the mass market.

Strategic Significance

The record Q1 results and ambitious full-year targets signal that Nagakawa’s strategic pivot to commercial air conditioners and expanded distribution is gaining traction. The company’s ability to achieve 39% of its full-year profit target in just one quarter suggests strong momentum. The rebranding to “Naga” may also help modernize its image. Vietnam’s air conditioner market is estimated at USD 2.9 billion in 2025, with annual consumption of around 2 million units, providing a large addressable market. However, the company must continue to manage cost pressures and competition from both domestic and international players.

What to Watch

• Q2 2025 earnings release to see if momentum continues.
• Progress on the rebranding to “Naga” and any marketing initiatives.
• Market share data in the commercial air conditioner segment.
• Changes in distribution partnerships, especially with Dien May Xanh and other chains.
• Any impact from potential El Nino weather patterns on air conditioner demand.