Vinh Hoan (VHC) Q1-2026 Profit Up 35% but Investment Losses in DXS, NLG Hit 40%

Overview

Vinh Hoan Corporation (VHC), Vietnam’s largest pangasius exporter, reported strong Q1-2026 results with net profit rising 35.3% year-on-year to VND 286 billion, driven by improved margins in fishmeal and fish oil segments. However, the company disclosed a nearly 40% loss on its investments in real estate stocks DXS (Dat Xanh Services) and NLG (Nam Long Investment), highlighting the volatility of its non-core financial portfolio.

Key Facts

• VHC’s Q1-2026 net revenue reached VND 2,955 billion, up 11.6% YoY.
• Net profit after tax was VND 286 billion, a 35.3% increase from Q1-2025.
• Gross profit rose 27.9% to VND 431 billion, outpacing revenue growth.
• Financial costs fell 54% to VND 26 billion, partly due to lower forex losses.
• The company recorded a VND 9.8 billion provision for its equity portfolio, representing a ~40% loss on cost.
• VHC invested VND 21 billion in DXS (current fair value VND 12.2 billion) and VND 3.5 billion in NLG (fair value VND 2.5 billion).
• Total assets stood at VND 13,756 billion as of March 31, 2026, with cash and short-term investments of VND 4,037 billion.

What Happened

Vinh Hoan released its Q1-2026 financial statements on April 10, 2026, showing robust operational performance. The company attributed the profit growth to improved margins in fishmeal and fish oil, which offset stable selling and administrative expenses. Financial costs dropped sharply due to lower realized forex losses compared to the same period last year.

Despite the strong core business, VHC’s trading securities portfolio suffered. The company held VND 44.5 billion in cost of equities, primarily DXS and NLG, but their fair value fell to VND 35.1 billion, requiring a VND 9.8 billion provision. This represents a loss of approximately 40% on these investments. VHC also held a small position in a Vietcombank fund, which posted a slight gain.

Market Context

VHC shares closed at VND 61,000 on April 10, 2026, up 1.66% on volume of 881,100 shares on HOSE. The stock has been supported by strong export demand and stable input costs. In contrast, DXS and NLG, both real estate-related stocks, have underperformed due to sector headwinds. DXS closed at VND 8,000 (-1.04%) and NLG at VND 29,000 (-0.51%) on recent trading days. VHC’s investment losses reflect the broader weakness in Vietnam’s real estate sector, which has faced liquidity and regulatory challenges.

Strategic Significance

VHC’s core seafood business remains resilient, with high cash reserves (VND 4,037 billion) and low leverage (short-term borrowings of VND 2,300 billion). The company plans to raise its 2025 cash dividend to 30% (VND 3,000 per share), signaling confidence in ongoing cash flow. However, the recurring losses from equity investments in real estate stocks suggest that VHC’s non-core financial strategy has been a drag on overall returns. For long-term investors, the key takeaway is that VHC’s earnings power is primarily tied to pangasius and by-product margins, not its equity portfolio.

What to Watch

• Q2-2026 revenue and profit trends, particularly fishmeal and fish oil margin sustainability.
• Any further provisions or divestments of DXS and NLG holdings in upcoming quarters.
• The impact of pangasius export prices and feed costs on core profitability.
• VHC’s dividend payout timeline and any changes to capital allocation policy.
• Broader real estate sector recovery, which could improve the fair value of DXS and NLG investments.