X-Stock | NKG VND 13,000 -13%: Changing Winds, Shifting Clouds

QUICK ASSESSMENT OF NKG’S 2025 EARNINGS

For full-year 2025, NKG recorded revenue of VND 14,899 billion (-28% YoY) and NPAT-MI of VND 197 billion (-56% YoY), completing 94% of BSC’s revenue forecast, 95% of BSC’s sales volume forecast, and 67% of BSC’s earnings forecast, respectively. The large deviation from our earnings forecast was mainly attributable to:

• Q4 sales volume falling short of BSC’s expectation. BSC’s forecast was 200,000 tonnes, while the actual figure was 180,000 tonnes. This reflected broader challenges in the steel sector, including: (i) increasing difficulty in rerouting steel through third countries to enter the EU and U.S. markets; (ii) changes in tax policies related to CBAM, affecting year-end import demand in the EU market; and (iii) still-weak global steel demand in general. Please refer to our HSG update report for further details.
• Q4 selling prices were lower than expected, weighing on the average selling price for the full year. BSC believes NKG is under much greater pressure to push sales volume than HSG. Specifically, NKG had to reduce its average selling price in Q4, while HSG was still able to maintain its selling price. Please refer to the following section for further details.

Compared with our previous report, BSC notes that NKG’s business operations are entering a more challenging phase. Weak sales volume, low selling prices, and the beginning of financial cost recognition from the new plant may continue to weigh on performance at least until 1H2026:

• The EU channel is seeing slow volume growth due to: (1) changes in tax policies related to CBAM; and (2) the EU’s expected implementation of the “melted and poured” rule from October 2026 to restrict imported steel. As of end-January 2026, the EU had not yet announced the carbon credit price, which serves as the basis for calculating import duties into the EU. Therefore, BSC believes exports may remain weak in Q1 before orders recover seasonally.
• Financial expenses are expected to increase in the coming period due to cost recognition from the new plant. According to the plan, the Nam Kim Phu My plant is expected to begin operations in 1H2026. Based on BSC’s survey, the company started recruiting personnel for the plant from Q4/2025.