Chuong Duong Beverage (SZC) Warns of Cash Exhaustion, Plans VND 93B Asset Sale

Overview

Chuong Duong Beverage Joint Stock Company (SZC) has issued a stark warning about its financial health, stating it may run out of cash to sustain operations by the end of 2024. The company, which has reported losses for five consecutive years, projects a net loss of VND 74 billion this year despite targeting a 50% revenue increase. To address the liquidity crisis, SZC’s board proposes selling its beverage production assets for VND 93 billion to pivot the company toward real estate.

Key Facts

• SZC forecasts a 2024 net loss of VND 74 billion, continuing a five-year loss streak totaling approximately VND 350 billion.
• The company targets 2024 revenue of VND 228 billion, a 50% increase from the previous year.
• Management warns operating cash may be insufficient to sustain business through year-end 2024.
• SZC proposes selling its Nhơn Trạch 3 factory and related assets, including the Saxi brand, to F&N Ventures for VND 93 billion.
• F&N Ventures is a subsidiary of Singapore-listed F&N, part of Thai billionaire Charoen Sirivadhanabhakdi’s Thai Beverage ecosystem.
• As of Q1 2024, SZC reported total assets of VND 622 billion, liabilities of VND 790 billion, and negative equity of VND 168 billion.
• The company recorded Q1 2024 revenue of VND 63 billion and a loss of nearly VND 11 billion.

What Happened

According to the company’s annual meeting materials, Chairman Tan Teck Chuan Lester stated that “with negative equity and severely declining operating cash flow due to continuous losses, management assesses the company will not have enough money to maintain operations until the end of this year.” The warning comes despite SZC targeting significant revenue growth, highlighting severe margin pressure in its core beverage business. Management cited Middle East conflicts increasing input costs for materials and logistics, further eroding gross margins.

The proposed asset sale to F&N Ventures represents a strategic exit from beverage manufacturing. While shareholders approved the divestment principle at an extraordinary meeting two months ago, they did not endorse F&N Ventures’ initial minimum offer of VND 75 billion. The board has set specific conditions for the buyer, including immediate payment of 35% of the transfer value upon contract signing to help SZC maintain operations and avoid bankruptcy risk.

Market Context

SZC trades on the Ho Chi Minh City Stock Exchange (HOSE). The stock closed at VND 29,000 on April 10, 2026, with a modest gain of 0.35% on volume of 534,000 shares. This price action occurs against the backdrop of the company’s severe financial distress and proposed strategic pivot. The beverage sector in Vietnam has seen average annual growth of 5-6%, with health-focused, low-sugar or sugar-free drinks benefiting from consumer trend shifts—a segment SZC acknowledges it lacks the capacity to develop.

Strategic Significance

The proposed VND 93 billion asset sale and subsequent pivot to real estate represent a fundamental transformation of SZC’s business model. Management explicitly stated that “after transferring the beverage segment, Chuong Duong Beverage could become a real estate company.” This shift aims to leverage the company’s existing real estate holdings in central Ho Chi Minh City and Bình Dương Province while seeking future opportunities. The move is a direct response to the company’s inability to compete effectively in the evolving beverage market and its critical need to improve financial autonomy and cash flow generation.

What to Watch

• Shareholder approval and final terms of the VND 93 billion asset sale to F&N Ventures, particularly the timing of the 35% upfront payment.
• SZC’s Q2 2024 financial results, to assess whether revenue growth targets are being met and if loss projections are tracking.
• Any regulatory filings or announcements detailing the company’s specific real estate development plans post-divestment.
• Updates on the company’s debt repayment capacity and any changes to its VND 790 billion liability position.
• Market reaction to the strategic pivot, including trading volume and price volatility around key decision dates.