The market of sauces, dipping sauces and spices is growing rapidly in Vietnam with  retail revenue reaching VND39.9 trillion in 2023, up 9 percent over 2022, according to Euromonitor. In 2009-2028, the spice market segment is expected to have a CAGR (compound annual growth rate) of 11 percent and value of VND65.8 trillion ($2.6 billion)

According to Euromonitor, Masan Group continues to set trends and maintain its lead in the market with 30 percent of market share, thanks to the ownership of strong brands and new product development. Among fish sauce producers, Masan accounts for 70 percent of market share. As for soybean and chili sauces, the figures are 60 percent and 50 percent, respectively.

However, investors are now paying attention to a smaller enterprise with a great ambition and 20-year vision. Over the last couple of weeks, investors have witnessed the strong rise of CMF shares of Cholimex Food. 

On June 26, CMF prices increased by another 15 percent, or 32,900 to VND252,400 per share. This is a rarely seen price increase in the stock market. 

With the price of VND252,400 per share, CMF has jumped to the third position in market prices on the bourse, surpassing Ha Long Beer and Beverage JSC (UpCom: HLB).

On July 8, CMF of Cholimex Food price soared to VND262,000 per share, even surpassing VE4 of VNECO4 Electricity Construction JSC (HNX).

As such, CMF’s market price is now the second highest in Vietnam, just second to the tech giant VNG (UpCom: VNZ) owned by Le Hong Minh. 

VNZ’s closing price on July 8 was VND570,000 per share.

According to analysts, CMF of Cholimex Food has a very high market price and the upward trend continues with very low liquidation because the enterprise has condensed shares, with 8.1 million units in total and three of the largest shareholders holding 92.55 percent of total capital. CMF has been operating well with revenue and profit increasing steadily.

Cholimex joined the chili sauce market in the late 1980s and its major products are soybean sauce, chili sauce and fish sauce. Together with Masan, TrungThanh and Nosafood, it is leading the industry and provides products to large retailers such as Metro, Co-op and Big C.

Prospects

One of the most outstanding features of Cholimex Food is its leading position in providing spices to large food brands, such as Haidilao, Pizza Hut, Popeyes, Domino’s Pizza and Jollibee, the fast food chains from the US, China and the Philippines.

In terms of shareholder structure, Cholimex holds 40.7 percent of Cholimex Food’s shares, while Masan Food has 32.8percent and Nichirei Foods Inc 19 percent.

In 2014, Masan, a big player in the consumer and retail market, owned by billionaire Nguyen Dang Quang wanted to increase its influence by offering to buy 49 percent of Cholimex Food’s shares at VND90,000 per share. However, the offer was rejected by Cholimex and Nichirei Food shareholders. At present, Masan is still a large shareholder of CMF.

In 2023, Cholimex Food reported the 14th consecutive year of revenue increase to VND3.4 trillion (up 5.9 percent over 2022), despite difficulties of the global economy and low domestic demand. CMF’s profit is high, at over VND200 billion per annum in the last two years.

CMF plans revenue of VND3.85 trillion in 2024

In the long term, CMF, run by president Huynh Trung An and CEO Diep Nam Hai, has an ambitious business plan, hoping to see revenue increase by five times in the next five years.

In the immediate time, CMF strives for revenue of VND10 trillion, to be sourced from frozen food products from a new food processing factory in Vinh Loc 2 industrial zone in Long An province, capitalized at VND850 billion.

In general, CMF benefits from the strong growth of the spice industry. However, it has to compete fiercely with Masan, Trung Thanh and Nosaffood.

Manh Ha