PNJ Reappoints Governance Officer Amid Diamond Smuggling Scandal, Q2 Loss of VND 283B

Overview

PNJ (Phu Nhuan Jewelry) has reappointed Ms. Do Thi Ngoc Thanh to a governance role, effective immediately, as the company deals with a diamond smuggling scandal at its wholly owned subsidiary P-Lab. The scandal led to the arrest of P-Lab’s director, the formation of a special supervisory committee, and a share buyback plan. PNJ reported a Q2 net loss of VND 283 billion due to provisioning, but H1 revenue rose 49.4% and net profit increased 6.3%.

Key Facts

• Ms. Do Thi Ngoc Thanh holds no PNJ shares and has no related parties holding shares.
• P-Lab director Dang Ngoc Thao was arrested and detained in a transnational diamond smuggling case.
• PNJ established a special supervisory committee with two independent board members and hired an international organization to independently assess diamond quality.
• PNJ implemented a 120-day deferred payment policy for buybacks starting July 21, with 95% of customers choosing to convert to gold instead of waiting.
• PNJ spent over VND 7,000 billion on diamond and gold buybacks from early July.
• Q2 2026 net revenue was VND 8,484 billion, but net profit was negative VND 283 billion due to provisioning.
• H1 2026 net revenue reached VND 25,729 billion (+49.4% YoY), net profit VND 1,256 billion (+6.3% YoY).
• Retail jewelry sales rose 13.6% and wholesale jewelry sales rose 28% in H1 2026.

What Happened

PNJ announced the reappointment of Ms. Do Thi Ngoc Thanh to a governance position, noting she does not own any PNJ shares and has no related parties holding shares. This move comes amid a crisis at its subsidiary P-Lab, where director Dang Ngoc Thao was prosecuted and detained for involvement in a transnational diamond smuggling ring. In response, PNJ’s board formed a special supervisory committee including two independent board members, commissioned an independent international diamond quality assessment, and initiated a share buyback plan.

To manage liquidity, PNJ introduced a new payment policy from July 21, requiring customers selling diamonds or gold to accept deferred payment over 120 days in five installments, or convert diamond jewelry to gold. In the first seven days, PNJ recorded total revenue of VND 1,393 billion and buyback value of VND 1,162 billion, with 95% of customers choosing gold conversion. PNJ stated that cash flow has improved compared to early July, though more time is needed for full assessment.

Market Context

PNJ shares closed at VND 32,500 on July 30, 2026, on the HOSE exchange. The stock has been under pressure since the scandal broke, with the Q2 loss and provisioning weighing on sentiment. However, the company’s core retail and wholesale jewelry businesses continue to show strong growth, with H1 revenue up 49.4% and net profit up 6.3%. The broader retail sector in Vietnam has been resilient, supported by domestic consumption and gold demand.

Strategic Significance

The reappointment of Ms. Thanh signals PNJ’s focus on strengthening governance and compliance amid the scandal. The special supervisory committee and independent diamond assessment aim to restore trust in PNJ’s product quality and internal controls. The share buyback plan and liquidity management measures demonstrate proactive crisis management. However, the Q2 loss from provisioning highlights the financial impact of the scandal. Long-term investors should monitor the effectiveness of these measures in stabilizing operations and cash flow, especially as PNJ enters the peak year-end season.

What to Watch

• Q3 2026 earnings release for signs of recovery in profitability and provisioning levels.
• Updates on the legal proceedings against P-Lab’s director and any regulatory actions.
• Effectiveness of the 120-day payment policy on customer retention and cash flow.
• Progress of the independent diamond quality assessment and any findings.
• PNJ’s share buyback execution and its impact on stock price and foreign ownership limits.