NAM KIM STEEL WENT OVER “STORM” STEADILY

day chuyen can trong nha may 6912

Although during 3 years, TNK suffered from the extremely tough period and step to a year with the severely fourth outbreak of Covid 19, TNK has tremendous growth in 2021.

 We had a nice discussion with Mr. Ho Minh Quang – Chairman of The Board of Nam Kim Steel JSC (TNK) to understand deeper about the “storm” passing strategy.

day chuyen can trong nha may 6912
Ton Nam Kim Line

During 3 years, TNK underwent an extremely difficult period before going up tremendously in 2021, can you share your feelings about this aspect?

Mr. Ho Minh Quang: I suppose that It’s 2 polar opposite emotions, however in this period, I believe that we will pass all temporary difficulty. It’s the stage which we did look at ourselves and decided to reconstruct many fronts of activities thoroughly. Enterprise has to force itself the best discipline after the rapidly increasing stage as well as when the hard market happened. We reconstructed, redistributed, set up the particular objectives corresponding to each timeline, and of course accepted a few certain losses.

The pandemic occurring in the past 2 years confounded all forecasts, the global supply chain was interrupted, many firms and industries have been suffering from the difficult situation but fortunately, the steel industry still has benefits on the global scope, even upstream and downstream. Actually, at the first stage, we had to struggle to adapt. If we did not have a good adaption or have the preparation, we would not seize the opportunity to recover in the last period. Particularly, in a hard situation, we kept concentrating our resources and cost into R&D, leveling up the quality to meet the strictest standards from Europe, the United States, and Australia. In terms of management, we reorganized departments based on the optimization of current resources and expropriated the new worth human resource.

The next step is standardization of operational processes and successful implementation of the ERP from SAP – Germany. This point changes fundamentally the management system to be more standardized. Activities from raw materials, production, quality management, sales, and finance are predictable and highly planned. This system really helps us operate smoothly during the pandemic, the interactions were mostly indirect from a distance, but the factory was still operating at almost full capacity.

These are seemingly simple things, but it is a process of persistent and consistent efforts that helped us increase productivity, reduce costs and utilize the market opportunity quickly.

ong ho minh quang chu tich hdqt ton nam kim
                 Mr. Ho Minh Quang – Chairman of the Board of Directors Ton Nam Kim

Can you tell us how the Covid-19 pandemic impacts the steel market in the general and coated steel industry in particular?

We must determine our state of mind of living with the pandemic in the long term. Vaccine is a solution, however, besides complying with government’s policies, firms need to build their own solution, which is appropriate with the real situation, and allows them to continue business activities in safe.

The global steel market has witnessed huge changes over the past few years, starting with protectism, and trade wars during President Trump’s period. Some countries prioritized the development of new technology industries and restructuring others, including steel. The pandemic has created a serious disruption in the global supply chain in many industries, steel is not an exception, this lead to an imbalance in Supply and Demand in many regions such as Europe or America, where the vaccine programs were pioneered at an early stage of the pandemic, and the economics recovered rapidly. Therefore, this event is an opportunity for Vietnam’s steel manufacturing with huge investment in recent years.

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Ton Nam Kim Lab

You believe that export still has great chances. Can you tell me more about the domestic market?

It must be said that in the past 5 years, with the investment to expand the scale of enterprises in the industry and also new entrants, the capacity of the industry has been getting larger, becoming redundant compared to the needs; hence, this makes domestic market competition become fiercer. Therefore, export is still a large market share with many segments that large domestic galvanizing enterprises are targeting.

For Ton Nam Kim, this does not mean that we take the domestic market lightly. Over the years, we have always maintained about 50% of capacity for the domestic market. We also develop high-strength, super-thick galvanized sheet products up to Z600, high-grade alu-zinc coating AZ250 products with a durability of up to 50 years, and suitable for constructions in corrosive environments. high wear. In the future, we will continue to develop different product lines for the domestic market

Nevertheless, the impact of the epidemic in Vietnam now is very heavy, domestic demand has not recovered yet, the proportion of exports, indeed, will be higher, even, the proportion of this channel accounted for more than 80% of sales volume in this third quarter. In order to achieve this, we had an early forecast when the disease showed signs of spreading in the South of Vietnam to prepare appropriate materials for the export market. Nam Kim proactively implemented “3 on the spot” very early, when there are mandatory local regulations. We also improve the welfare regime so that employees can stay at the factory to organize safe production and so far there have been no cases of infection.

The story of galvanized steel enterprises in the past quarters is export, what can you share?

The export market always changes over time, it is sometimes difficult or favorable. For example, Europe or North America is our focus in this quarter or this year, but next quarter, next year, the Asian market will recover when the epidemic is well controlled. And the risk factors of trade and protectionist policies are always present. But over the years, Vietnamese corrugated iron enterprises have gotten used to and adapted to these changes.

Our international sales team is experienced with trade remedies, and we also receive active support from state management agencies, especially the Ministry of Industry and Trade. Moreover, in the integration trend, Vietnam has joined many trade agreements with many countries and regions, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), The European Union Vietnam Free Trade Agreement (EVFTA),… will help limit barriers in export activities.

As I said above, besides the domestic market, Ton Nam Kim aims to have a larger and broader international market share. Especially in recent times, the Chinese Government has adjusted the policy for their national steel industry, which is to control output, cancel the tax refund subsidy for almost all steel products exported in the past time, including coated steel products. This may motivate investment activities to increase the scale of Vietnam’s coated steel coils enterprises in the coming time to export.

And will Ton Nam Kim follow this trend?

It must be said that the European and American markets with strict quality requirements have pushed us to continuously improve to target higher product segments in the past time. We are confident enough to participate in the global high-quality galvanized steel market share. We are currently promoting the investment project to expand phase 1 to increase capacity to 1.6 million tons by 2023. In this expansion project, we focus on technology factors to target the high-end market.

Although there are concerns about the steel industry’s decline when completing the project, with the trend of restructuring the steel industry in some countries, we believe that the demand from the international market for galvanized steel products of high quality from Vietnam is still increasing.

What is your business philosophy?

I simply think that our products are related to the roof, to the building. And that is also the heritage, the lifelong passion of users, so we have to create a product of real quality that corresponds to the cost they spend. Our first color galvanizing lines were supplied by Posco E&C Korea. After that, when scaling up, I always choose technology from famous providers like German SMS. Even in the past difficult period, when restructuring operations, we still decided to raise the quality standards of all Zinc, Galvalume, Painted color, and steel pipe products for the domestic market. Although the cost of the product is higher, we still do not change the price of the product. We do not take advantage of technology to create products with low-quality standards to create competitive prices but bring deficient value to customers. We understand that, in fact, no matter how modern the technology is invested, if we keep thinking about creating products with competitive prices based on low-quality standards, our products cannot be of good quality no matter where they are in any segment.

Thank you, Sir!

According to Thanh Nien newspaper on October 11th, 2021.

Find more information on the newspaper page: Tôn Nam Kim vững vàng vượt ‘bão’ (thanhnien.vn)

TON NAM KIM – TOP 2 PRESTIGIOUS BUILDING MATERIAL EXPORTERS IN 2020

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ton nam kim top 2 05 05

The Ministry of Industry and Trade has just issued Decision No. 1974/QD-BCT on August 18, 2021, announcing the List of “Prestigious Exporting Enterprises” in 2020, an honorary award for Vietnamese businesses working in international sales. Accordingly, in 2020, Ton Nam Kim continues to hold the top 2 positions in the building materials industry

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In the first six months of 2021, Ton Nam Kim achieved revenue of 11,862 billion dong, earning before taxes of 1,342 billion dong. Total sales volume reached 518,000 tons, gained 16.67% market share, and ranked second in the industry. In which, Export volume reached 305,000 tons, worth 295 million USD with the main markets US, Europe, and Australia.

Ton Nam Kim, a national brand, is proud to bring coated steel products to the international market with the professionalism and prestige built over the past 20 years, trusted and trusted by customers.

With the modern technology production lines provided by SMS Group – Germany, Ton Nam Kim, over the years, has constantly promoted research and development to bring to the market quality products that meet the strictest quality standards in the world such as JIS (Japan), AS (Australia), ASTM (USA), and EN (Europe), with the key products such as Z275 – Z600 galvanized steel sheet, AZ200 aluminum-zinc alloy coated steel sheet, PVDF color sheet AZ200 … with warranty commitment from 20 to 50 years.

In the domestic market, high tensile galvanized steel sheet and color coated steel sheet under Ton Nam Kim brand is trusted by famous domestic contractors such as Zamil, Kirby, PEB, ATAD, Dai Dung, SBC, Seico …

WORKERS HAVE ADDITIONAL SUPPORTIVE INCOME FOR THEIR LOVED ONES RELY ON THE SPOT BONUS

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background tnk testing

(The covid-19 severe pandemic causes the lockdown and social distancing of most areas, leading many enterprises to suffer from closing some unessential production–business activities, seriously affecting the current jobs of millions of workers as a result. However, Ton Nam Kim has been keeping up the effort into safe production while obeying (*)“3 in one spot” and taking care of laborers enough.) (*)3 in one spot, which requires companies to allow employees to work, eat, and rest in one location.

Owing to the peculiarity of the production industry, most of Ton Nam Kim’s members are male, are breadwinners of their own families. Understanding their concerns, Ton Nam Kim’s Board of Management has been coming up with several policies in time to assure no reduction of income for all staffs such as the provision of necessities, the increasing of supportive level for those who participate “3 in one spot”, the maximum rewards – 1month salary for all workers.

According to Mr. Ho Minh Quang – Chairman’s speech, applying this policy for all staffs to ensure have additional income to alleviate difficulty if their loved ones are reduced salary or even lose jobs. This aims to encourage laborer’s minds to keep working without anxiety.

Besides that, Boards of Director command TNK’s managers to concentrate with high level, implement severe measures to prevent the epidemic from guaranteeing the safety and production; frequently bring up, encourage and support to staffs at each department, production line,… with the total cost up to tens of billions.

Affirmatively, these humanistic activities for workers of TNK’s Board of Directors assure the closest reality, the performance, the encouragement to build the engrossed laboring spirit, the enthusiasm, the creation, contributing to generate high and effective productivity. Hence, it acts as a precursor to a corporation’s development, strengthens income and well–being for all workers, and successfully implements dual targets in this historical pandemic

TON NAM KIM DONATES 2 BILLION VND FOR EPIDEMIC PREVENTION WORK IN BINH DUONG PROVINCE

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ton nam kim ung ho 2 ty dong

Recently, the 4th Covid-19 epidemic in Vietnam has had extremely complicated developments, occurring in localities with many outbreaks and unclear transmission sources. In Binh Duong province, authorities and local people have successfully implemented measures to prevent and control the Covid-19 epidemic.

Continuing the tradition of solidarity, mutual love, and mutual love of the nation, the Vietnam Fatherland Front Committee of Binh Duong province calls on agencies, organizations, businesses, and individuals to join hands to support Binh Duong Province’s implementation of Covid-19 pandemic prevention work.

Responding to an appeal, on the morning of May 27, 2021, at the Administrative Center of Binh Duong Province, Mr. Ho Minh Quang – Chairman of the Board of Directors – representative of Nam Kim Steel Joint Stock Company donated an amount of 2 billion VND to the Committee. The Vietnam Fatherland Front in Binh Duong province aims to join hands to contribute more resources with the Party and State to repel the spread of the disease.

NKG GSM: 2021 REVENUE CAN BE ACHIEVED AT NINETEEN THOUSAND BILLIONS VND BECAUSE PRICING OF STEEL EXCEEDS THE PLANNING SCENARIO.

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According to the General Director of NKG, steel prices have increased to exceed the business plan of development in 2021 scenario. Actually, the hot-rolled coil (HRC) price is currently at 930-950 USD/ton compared to the suggested one at 700-750 USD/ton.

The 2021 Annual General Meeting of Shareholders of Nam Kim Steel Joint Stock Company (HOSE: NKG) was held on April 24 morning.

DISCUSSION SECTION

Pricing of the hot-rolled coil has been increasing significantly. How does NKG manage the relevant risks?

General Director – Mr. Vo Hoang Vu: The business circumstance of the steel industry has currently been remarkably favorable, but there are various potential risks.

We have been focusing on two markets which are domestic and international. With the current export market, we can transfer all the increase in raw material costs into the final selling price because our group determines the selling deadline and the buying one, which should be matched together. In addition, we can immediately ”transship” because the demand for coated steel in Europe and North America is very good and also there is a shortage in supply. In terms of selling prices in Europe and North America are also of considerable different levels (should be higher) compared to Asia..

With regard to the domestic market, our selling price currently has a particular slow but not too big. On that basis, we always build a price strategy based on different periods of time. We can understand the closed price and the actual quantity of goods in hand to calculate the risk. In sum up, we are keeping this situation under control.

Does NKG plan to increase capital or increase capacity?

President – Mr. Ho Minh Quang: Currently, we have no plans to increase capital and invest. The deployment plans for steel pipe factories and steel mills are to optimize our current operating production capacity, which does not expand the production scale yet.

In the near future, if it is necessary and there is a demand, we will summon an Extraordinary General Meeting of Shareholders to request a capital increase.

Will Chu Lai Steel Pipe Factory continue to be deployed or not?

General Director –Mr. Vo Hoang Vu: In the period of 2019, we did not exploit the full capacity of this factory, hence, we honestly thought about developing in the Central region. However, from 2020, when domestic sales grow again, especially in steel pipe segment, we see that the South zone can still be developed.

If we continue with Chu Lai Project, NKG will lack raw materials. Currently, the company will be expanded in Binh Duong, along with our former factories being operated at full production capacity. In this context, raw materials will not be enough to supply to the Central region. As a result, the steel pipe factory project in Chu Lai should be temporarily postponed.

Is the 2021 business plan too optimistic? What if steel prices reverse?

General Director –Mr. Vo Hoang Vu: Actually, this plan was made at the beginning of the year, and some financial institutions shareholders have expressed their opinion if setting these numbers is too prudent? However, I affirm that we have already included the element of caution in this plan.

Steel enterprises are currently greatly efficient thanks to steel price improvement. Of course, when the price increases, there will also be a decrease, the key point is how we will manage that risks.

This strategy can be achieved in a half year. With the last 2 quarters, we will consider the actual situation. Therefore, we would like to keep and hold the current plan to avoid following the high planned numbers and lead to threats.

Could you please predict the Hot rolled coil price in 2021?

General Director – Mr. Vo Hoang Vu: Currently, the hot-rolled coil price is over $960/ton in the Asian and Vietnamese markets. Even this price is still much lower than the price in the US and European markets.

However, we will not base on the steel price increase to carry out the speculative activities, but we ought to calculate purchases cautiously.

Some suppliers have built domestic distribution channel, has Nam Kim had any plan for this?

General Director – Mr. Vo Hoang Vu: We’re not able to exactly analyze the market development and distribution channel policy of other firms. Nam Kim is trying to focus on the level of production, quality of products, cost of production, and prices in order to enhance competitive capabilities, in the meantime, we are creating a sale channel through distributors, steel service centers, and consolidating supplying prefabricated steel buildings.

How is the steel market expected in 2021 and in the future?

General Director – Mr. Vo Hoang Vu: In 2020-2021, the steel industry witnessed many unexpected and astonishing developments. At the beginning of 2020, the market stagnated; however, we believe that the global economy will recover in 2021 and further in the mid-term, and the steel market will accordingly benefit.

Prices have consistently increased due to lack of supply and an increase in the price of inputs. Basically, from a mid-term outlook, demand is getting better, especially the US and European market is in a shortage of steel.

Over the past ten years, developed countries have slowed down in building blast furnaces; these business activities mainly focus on China. Nevertheless, the Chinese government has been tightening steel production and exports as they become more aware of environmental pollution. Steel supply will no longer be as redundant before. 

On this basis, the overall steel market is still attractive and looks potential in the long term. Meanwhile, the short-term may show a fluctuation in price. Hence, we are planning lots of scenarios in order to manage risks well.

Total revenue can reach 19,000 billion VND

Regarding the business plan for 2021, NKG board of directors submitted the shareholders to approve targeted revenue of VND 16,000 billion and VND 600 billion profit after tax, reflecting 38% and 103% up respectively comparing to 2020.

“This plan was built at the beginning of the year among steel prices much lower than now. At that time, the steel price was 700-750 USD/ton, but it increased to 930-950 USD/ton at the moment. Therefore, the total annual revenue of NKG may be 20% higher than the plan, possibly reaching 19,000 billion dong. This also depends on the price of steel in the near future.” – General Director Vo Hoang Vu shared.

According to President Ho Minh Quang, the business plan for 2021 is set out very carefully. “By the second quarter, the company can know for sure the profit after tax plan of about 600 billion dong,” he said.

Last quarter, NKG achieved a net revenue of VND 4,853 billion and profit after tax of VND 319 billion, fulfilling 30% and 53% of the whole year 2021 plan, respectively.

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Source: VietstockFinance

In light of the situation that prices keep very high and fluctuate unpredictably, GD Vu and his board of directors always closely follow up the market and continuously create scenarios in every period. In relation to buying–selling activities, “the work is being built with high cautiousness,” said GD Vu. 

According to GD Vu, the financial situation of NKG remains healthy. “Currently, NKG’s assets are mainly contributed by Inventories, receivables, cash, and cash equivalent. Liquidity is completely good.” Said the GD.

In 2021, NKG’s board of directors set a production target of 900,000 tons. However, according to General Director Vu, the total capacity of NKG factories has now increased to 100,000 tons/month thanks to the successful application of Enterprise Resources Planning (ERP).

NKG is also investing in a steel pipe factory and steel coils warehouse in Binh Duong to optimize the capacity of the factories. Company leaders said that the space at the existing factory is “very cramped”.

“In order to increase the operating capacity of all factories and improve customer service, it is imperative to invest in warehouses and move some operations out of the factory area,” said NKG General Director.

The General Meeting of Shareholders ended with all proposals approved. Source: https://vietstock.vn/2021/04/dhdcd-nkg-doanh-thu-2021-co-the-dat-19-ngan-ty-dong-vi-gia-thep-vuot-kich-ban-ke-hoach-737-850600.htm?fbclid=IwAR2NceraNmw9U1vpEUqTsfOmCXycH969HduM_iJEC2t8iJ3ADA5OEQvv1O4

Nam Kim Steel Joint Stock Company
Lot A1, Đ2 Street, Dong An 2 Industrial Park, Thu Dau Mot City, Binh Duong
T. (+84)274 3748 848 | F. (+84)274 3748 868
Email: info@namkimgroup.vn

Representative office
Room 802, 8th Floor, Ha Do Airport, 02 Hong Ha, Ward 02, Tan Binh District, Ho Chi Minh City
T. (+84)283 6204 829
Email: info@namkimgroup.vn