Vietnam National Petroleum Group (Petrolimex), the nation's largest fuel retailer, anticipates a challenging year ahead, as outlined in its annual shareholder meeting documents for late this month. The company projects "more difficulties and challenges than advantages" for this year. Consequently, Petrolimex aims for a 2% increase in revenue, targeting 315 trillion VND, while after-tax profit is expected to decrease by 7% to 3,380 billion VND, marking its lowest level in four years.
Petrolimex's leadership expects consumption volume to grow by 8,5-10% this year and next. While electric vehicles are beginning to show a more noticeable impact, they have not yet dominated the market due to the substantial number of internal combustion engine vehicles still in use. However, plans to restrict gasoline vehicles in urban centers starting next year are anticipated to affect sales in major cities.
The company predicts that traditional fuel sales volumes could peak or stabilize between 2028 and 2030. During this period, the impact of electric vehicles, green fuels, and vehicle restriction policies is expected to become more pronounced. Specifically, electric vehicle prices may decrease, and charging infrastructure along with incentive policies are projected to become more effective. Furthermore, restrictions on gasoline-powered vehicles in major cities will likely be more fully enforced, putting pressure on sales volumes in these regions.
Despite these challenges, Petrolimex anticipates that highway network development projects, economic growth, and an increase in freight transportation demand will partially offset the projected decline in sales volume.
In its audited financial report, Petrolimex's leadership also highlighted that the Middle East conflict has adversely affected the normal business environment. Given the company's heavy reliance on oil sources from the Middle East, global prices have surged since the conflict began, particularly for diesel oil. International transportation costs have also risen with fuel prices, compounded by unusual increases in transport surcharges.
Looking ahead, Petrolimex has set a five-year target for average revenue growth that will not be lower than sales volume growth, projected at 7% annually. Profits are expected to increase by 6-7% each year, with average dividends reaching 8-10%.
Petrolimex is Vietnam's largest fuel retailer, holding an estimated 50% market share by sales volume and operating a network of 5,500 fuel stations nationwide. Last year, the company's revenue increased by over 9% to approximately 310 trillion VND, though pre-tax profit fell by about 8% to 3,643 billion VND.
On the stock market, Petrolimex shares are currently trading at around 39,000 VND, an increase of about 10% compared to earlier this year.
By Phuong Dong
