PNJ Responds to Diamond Smuggling Probe, Stock Hits Ceiling

Overview

Phu Nhuan Jewelry Joint Stock Company (PNJ) issued an open letter on August 21 responding to a transnational diamond smuggling investigation by Thanh Hoa Provincial Police. The company emphasized that the smuggled diamonds were not sold through its retail system and that its import records are compliant. The stock hit the ceiling price of 39,900 VND on the same day.

Key Facts

• PNJ issued an open letter on August 21, 2026, addressing customers, media, shareholders, investors, and partners.
• The investigation by Thanh Hoa Police involves a transnational diamond smuggling ring, with diamonds allegedly brought from Hong Kong to Vietnam illegally.
• Two PNJ-LAB employees are implicated: Dang Ngoc Thao, Director of PNJ-LAB, and Tran Tien Nhu Nghi, a PNJ-LAB staff member.
• The smuggled diamonds were not sold through PNJ’s retail system; they were sold to individual customers outside the company’s channels.
• Police confirmed that PNJ’s diamond import records are compliant and that the smuggled diamonds are separate from PNJ’s retail inventory.
• PNJ’s stock (HOSE: PNJ) closed at the ceiling price of 39,900 VND on August 21, 2026.

What Happened

On August 21, PNJ issued an open letter in response to the ongoing investigation by Thanh Hoa Provincial Police into a transnational diamond smuggling ring. The company cited information from the police indicating that PNJ has complete and valid documentation for its diamond import activities. PNJ emphasized that its import and distribution processes are controlled, cross-checked with records, and conducted in accordance with legal regulations.

The company stressed that the diamonds involved in the case were not introduced into its retail system. According to PNJ, all products sold through its stores undergo quality inspection, have traceable origin information, and are controlled before reaching customers. PNJ stated it respects the conclusions of the authorities and views the disclosed information as a basis for customers, shareholders, and investors to gain a clearer perspective on the matter. The company also committed to continuing to review and upgrade its risk management and internal control systems.

The open letter came one day after the police announced initial investigation results, including forensic findings from the Ministry of Public Security’s Institute of Criminal Science. The seized stones included both natural and synthetic diamonds. The investigation identified Dang Ngoc Thao, Director of PNJ-LAB, and Tran Tien Nhu Nghi, a PNJ-LAB employee, as directly involved. They allegedly colluded with individuals in India to smuggle diamonds from Hong Kong into Vietnam. Thao is accused of using his expertise to grind off GIA numbers on diamonds, replacing them with PNJ-LAB certification marks, and issuing new certificates before selling the stones.

Market Context

PNJ shares (HOSE: PNJ) closed at the ceiling price of 39,900 VND on August 21, 2026, reflecting a strong positive market reaction to the company’s response. The stock’s performance suggests that investors view the company’s clarification as reassuring, despite the ongoing investigation. The broader Vietnamese retail sector has been under scrutiny, and PNJ’s handling of this issue is being closely watched by market participants.

Strategic Significance

For long-term investors, this event underscores the importance of corporate governance and compliance in Vietnam’s retail sector. PNJ’s proactive communication and emphasis on its compliant import processes may help mitigate reputational risk. The company’s commitment to enhancing internal controls could strengthen investor confidence. However, the expansion of the investigation and potential legal implications for the implicated individuals remain key risks. The outcome will test PNJ’s crisis management capabilities and its ability to maintain trust among customers and shareholders.

What to Watch

• Further updates from Thanh Hoa Police on the investigation’s progress and any additional individuals implicated.
• PNJ’s Q3 2026 earnings release, which may reflect any impact on sales or brand perception.
• Any regulatory actions or fines imposed on PNJ or its subsidiaries.
• PNJ’s implementation of enhanced internal control measures and any public disclosures on governance improvements.
• Market reaction to any new developments, including potential impact on PNJ’s stock price and trading volume.