Steel stocks defy market weakness as Tran Dinh Long's wealth climbs

According to Forbes, Tran Dinh Long, chairman of Hoa Phat Group (HPG), gained $40 million, equivalent to more than VND1 trillion, in net worth as of October 14. His fortune reached $2.3 billion, placing him 1,752nd on the global billionaire ranking.

Long's wealth increased significantly in two of the past three trading sessions, even as Vietnam's broader stock market struggled.

On October 14, HPG shares climbed more than 1.7% to VND20,800 ($0.79) apiece and continued to edge higher toward the end of the morning session on October 15.

Other steel stocks also showed signs of recovery.

Nam Kim Steel (NKG) posted strong gains in three of the past four sessions, including hitting the daily upper price limit on October 12 and 14. Viet Duc Steel (VGS) gained nearly 8% in each of those two sessions, while Vietnam Steel Corporation (TVN) reached its highest level in three months.

Hoa Sen Group (HSG) also recorded gains of 4-5% on October 12 and 14. During the morning session on October 15, HPG, HSG, VGS and TVN were largely trading sideways.

The rebound is particularly notable after many steel stocks lost 20-40% of their value over the past six months to a year.

While the broader Vietnamese stock market has faced pressure from rising bank interest rates, a sluggish property market and foreign investors withdrawing capital from numerous stocks, the steel sector is beginning to attract renewed buying interest.

The improving sentiment reflects more than short-term share price movements. Investors are also responding to stronger business performance, improving demand prospects and trade policies aimed at protecting domestic steel production.

Stronger demand and improving margins support Hoa Phat's outlook

Vietnam's steel industry is benefiting from recovering domestic demand, particularly in construction, public investment and large-scale infrastructure projects.

These are important growth drivers for a highly cyclical industry closely linked to infrastructure development and the property market.

Recent corporate sales figures suggest demand is strengthening.

Hoa Phat reported combined sales of hot-rolled coil (HRC), construction steel, high-quality wire rod and steel billets of 10.3 million tonnes in the first nine months of 2026, up 39% year on year.

HRC sales alone reached 5.47 million tonnes, representing a 59% increase.

Thai Nguyen Iron and Steel (TIS) also reported steel sales exceeding 730,000 tonnes during the nine-month period, up 10.5%.

Meanwhile, Thong Nhat Flat Steel (TNS) recorded third-quarter after-tax profit of VND9.6 billion ($365,000), nearly nine times the level a year earlier, despite a decline in revenue.

Its gross profit margin rose from 2.7% to 14.8%, illustrating how significantly profitability can improve when the gap between selling prices and production costs becomes more favorable.

According to a report by MB Securities (MBS), domestic steel consumption in the third quarter of 2026 was projected to reach 7.68 million tonnes, up 20% year on year.

Construction steel consumption was expected to rise 26%, while HRC demand was forecast to increase 35%, driven by residential construction and infrastructure development.

Higher selling prices are also providing support.

In early October, major producers including Hoa Phat, Formosa Ha Tinh, VAS Nghi Son and Vina Kyoei announced price increases for selected steel products.

MBS estimated that construction steel prices rose 7% year on year in the third quarter to approximately $560 per tonne, while HRC prices increased 6% to around $550 per tonne.

Input costs, however, have followed different trends.

Coking coal prices have risen sharply since the beginning of the year, while iron ore prices have fallen by approximately 13%, according to the figures cited.

A weaker US dollar against the Vietnamese dong could also ease cost pressures for some imported raw materials.

The actual benefits will depend on each producer's raw material mix, purchasing schedules and pricing policies.

Trade protection measures are another potential advantage for domestic producers.

Anti-dumping duties on wide-width HRC steel have helped create a more favorable competitive environment for Vietnamese manufacturers.

The domestic share of the HRC market is reported to have exceeded 70%, compared with approximately 60% in 2025, while steel imports from China have fallen by more than 10%.

Hoa Phat is particularly well positioned to benefit from stronger demand because of its large production capacity, extensive distribution network and diversified product portfolio.

MBS forecasts that HPG's net profit could increase 40% year on year, supported by stronger domestic sales and improving gross margins.

Hoa Sen and Nam Kim are expected to record profit growth of 159% and 30%, respectively, from their relatively low 2025 bases, as galvanized steel prices improve more favorably than HRC prices.

High-tech steel investment offers another growth opportunity

Hoa Phat's longer-term outlook is also linked to its planned expansion into high-tech steel production.

The group is developing a railway steel plant in the Dung Quat Economic Zone in Quang Ngai province, with first-phase investment exceeding VND10 trillion ($380 million) and designed annual capacity of 700,000 tonnes.

The facility is intended to manufacture rails for high-speed railways and urban metro systems, alongside other specialized steel products.

The project could allow Hoa Phat to play a larger role in Vietnam's domestic railway infrastructure supply chain.

If successfully implemented, it could become another growth driver alongside the company's traditional construction steel and HRC businesses.

HPG shares have also attracted attention following a major planned purchase by Tran Vu Minh, the son of Chairman Tran Dinh Long.

Minh registered to acquire an additional 50 million HPG shares between October 7 and November 5, 2026.

Before the proposed transaction, he held more than 230.65 million shares, equivalent to 2.732% of Hoa Phat's charter capital.

If the purchase is completed in full, his ownership would increase to approximately 3.32%.

Within the chairman's family, Long's wife, Vu Thi Hien, holds approximately 580.8 million HPG shares, representing 6.879% of the company.

Dai Phong Trading and Investment Co., Ltd., where Minh serves as director, also owns nearly 3.98 million shares.

Overall, Vietnam's steel sector is benefiting from a combination of stronger sales volumes, higher selling prices, trade protection measures and infrastructure investment.

However, whether the recent stock market rebound can be sustained will ultimately depend on actual corporate earnings and the continued flow of investment capital into the equity market.

Manh Ha