Thien Long (TLG) Cuts 2026 Profit Target Amid Kokuyo Takeover

Overview

Thien Long Group (TLG) has published its 2026 business plan, targeting net profit of VND 440 billion, a 1.1% decline from the 2025 result of VND 445.1 billion. The guidance, to be presented at the upcoming AGM on April 22, 2026, reflects rising input material costs and a strategic decision to maintain stable selling prices. The announcement comes as Japanese stationery giant Kokuyo moves to acquire a 65.01% stake in TLG for approximately VND 4,700 billion, a transaction that has not yet been completed.

Key Facts

• TLG targets 2026 consolidated net profit of VND 440 billion, down 1.1% from VND 445.1 billion in 2025.
• 2026 revenue target is VND 4,400 billion, up 5.4% from 2025’s VND 4,173.9 billion.
• 2025 net profit fell 3.3% year-on-year despite an 11.1% revenue increase.
• Kokuyo plans to spend about VND 4,700 billion (JPY 27.6 billion) to acquire a 65.01% stake in TLG, announced in December 2025 but not yet closed.
• TLG’s e-commerce revenue surged 99% in 2025, with TikTok Shop sales up 258%.
• The company maintains a 35% cash dividend target for 2026, same as the interim dividend paid for 2025.
• TLG’s export revenue reached VND 1,185 billion in 2025, up 17.1%, accounting for 28.4% of total revenue.

What Happened

Thien Long Group (TLG) released its 2026 business plan in documents prepared for the upcoming Annual General Meeting (AGM) scheduled for April 22, 2026. The company targets 2026 consolidated net profit of VND 440 billion, a 1.1% decrease from the 2025 result of VND 445.1 billion. Revenue is targeted at VND 4,400 billion, representing 5.4% growth year-on-year.

Management attributed the flat profit guidance to rising input material costs and a deliberate strategy to keep selling prices unchanged rather than raising them by 15-20%, which would protect distribution channels and market share. The company also plans to increase employee compensation to strengthen internal capabilities. The 2026 operational strategy focuses on three areas: expanding OEM/ODM production capacity for the US, Europe, and Japan; and allocating 70% of resources to core business segments.

Market Context

TLG shares trade on HOSE. The stock has been under pressure amid the pending Kokuyo takeover, with the acquisition price of approximately VND 4,700 billion implying a premium that has supported valuations. The 2025 financial results showed a 3.3% decline in net profit despite 11.1% revenue growth, reflecting margin compression from higher input costs. The 2026 guidance suggests management expects continued margin pressure, which may weigh on near-term sentiment. The broader consumer staples sector in Vietnam has faced rising raw material costs, but TLG’s decision to hold prices steady is a defensive move to preserve market share.

Strategic Significance

The conservative 2026 profit target signals that TLG’s management is prioritizing market share and distribution stability over short-term margin expansion, even as input costs rise. This approach aligns with the pending Kokuyo acquisition, as the Japanese partner may prefer a stable operational base before implementing post-acquisition strategies. The focus on OEM/ODM expansion for export markets, particularly the US, Europe, and Japan, indicates a long-term shift toward higher-value manufacturing. The e-commerce channel’s strong growth (99% in 2025) and AI integration in logistics suggest TLG is building competitive advantages in digital retail, which could support future margin recovery once input costs stabilize.

What to Watch

• Completion of Kokuyo’s acquisition of a 65.01% stake, including regulatory approvals and payment terms.
• Q1 2026 earnings release to assess whether revenue growth is on track and margin trends.
• Raw material cost movements, particularly for plastics and paper, which are key inputs for stationery products.
• Any changes to pricing strategy or dividend policy post-acquisition.
• Expansion of OEM/ODM contracts with international partners, especially in Japan and the US.