THANH HOA BEER JOINT STOCK COMPANY

Transcription

1 FPT SECURITIES JOINT STOCK ANALYSIS REPORT OF NEWLY LISTED STOCK 19 November 2008 International Trading Name Trading Name Abbreviation Address Listing Company THANH HOA BEER JOINT STOCK Thanh Hoa Beer Joint Stock Company Thanh Hoa Beer THB Telephone Fax Website Business Industry 152 Quang Trung- Ngoc Trao- Thanh Hoa City Manufacturing of alcoholic and non-alcoholic beverage, including various types of beers, carbonade drinks, bottled Bordeaux wine; Ice. Producing, trading and im-exporting of wines, beers, carbonade and non carbonade drink, mineral water. Importing raw material, tools accessories for the company business activities of producing wines, beers and beverages. Restaurant and Hotel. Shareholders structure as of listing date: Shareholders Value (thousand VND) Number of Shares Percentage (%) HABECO Company employees ,3 Outside Shareholders ,7 Source: THB Prospectus Corporate Finance Department FPT Securities JSC Nguyen Thi Thai Anh Tel: 084 (04) ext 4501 Nguyen Thi Phuong Chi Tel: 084 (04) ext 4502 The infomation is gathered from the Prospestus, infomation provided by the company, EzSearch database of FPTS at address: Advisory Organization FPT Securities Joint Stock Company (FPTS) 71 Nguyen Chi Thanh, Ha Noi Tel: (84-4) Fax: (84-4) Website: Auditing Organization AUDITING AND ACCOUNTING FINANCIAL CONSULTANCY SERVICES LIMITED 29 Vo Thi Sau, Dist. 1, HCM City Tel: (08) Fax: (08) Listed Stock Information Capital Number shares Face value of Source: THB Prospectus Content of the Report 114,245 Bil VND 11,424 mil Shares VND/Share Overview About Vietnam Beer Industry About the Company Establishment and growth Business performance Financial Status and Forecasting SWOT Analysis Risk Analysis Others points that investors need to be aware of Information for P/E valuation method: EPS 2008: 2,159 VND EPS 2009: 3,261 VND Net value of fixed assets (2008)/Litre of Beer: 0,12$ The analists who doing this report do not involved in any investment activities on the analysed organization or any other stocks of the competitors in the industry. Important announment will be present at the end of the report. Copyright FPTS. Redistribution or reproduction is prohibited without written permission. 1/10

2 FPT SECURITIES JOINT STOCK OVERVIEW ABOUT VIETNAM BEER INDUSTRY Growth prospects of Vietnam Beer Industry Strong GDP growth, over 7% each year in the last 5 years, has resulted in healthy disposable income of Vietnamese people, therefore the demand for canned beverages, and drinks is increasing rapidly, that is a great advantage for the development of the beverage industry. Westernization and predominantly young population (85% of Vietnam s population is under the age of 40) have driven beer consumption. Under-penetrated market: In 2006, Vietnamese people consumed 15 litres of beer per person on average. Quite low in comparison with some European countries with the average of 88 litres and some Asian such as Japan and Korea: 43 litres per person per year. The level of market penetration of the beer industry still relatively low therefore many opportunities for development and launching new product lines still waiting for companies inside the industry. With the higher living standard and the trend of adopting to Western living style of the Youth, new products such as low or no-alcohol beer, dark beer, are having many potential of having a strong position in the market, creating an additional source of revenue for the companies in the beverage industry. About the potential of the industry of which many specialits have forecasted with the growth rate of 15% each year, recently, inside the industry, there is a trend of booming in investment to increase capacity for many beer factories, in order to utilize the available resources and facilities, moreover, they also attracting investment from companies from different industry such as Vinamilk company, Vietnam National Tobacco Corporation, The Vinashin Group. The market also have the trend of merger and acquisition in order to reduce the investment level of the huge companies and upgrading, utilizing the resources of small players more efficient. Investment capital, technologies and management experiences of the foreign partners together with the distribution and logistic channel of the domestic partner have been utilized efficiently in many joint ventures. We can easily recognize the efficiency of the joint ventures business through their market share. The Government Policies Beer and beverage industry has been planned by the Ministry of Industry and Trade to develop into a strong industry; striving to cut cost, increase competitiveness, satisfying the domestic demand and increase export, increase the source of revenue, solidly joining with the area and global economic. Within the industry, the field of manufacturing beer has proved its advantages. Beers is the highest consumed products in the alcoholic beverage category, account for 89% of the total revenue and 97% in term of volume. The development plan of the beer industry has been set with the target of 3,5 billions litres in 2010 by the Ministry of Industry and Trade and the amount of investment capital for the beer and beverage industry is estimated at 34,7 thousands billions VND.. The Gorvernment is encouraging investors to invest into modern factories with high capacity (more than 100 millions litres per year). The Government also encourage firms, through joint venture cooporation, carrying out the handing over of technologies in order to improve the quality of Vietnamese beer to meet the standard of quality and technologies. (However, the Government still have not allowed foreign investors to possess 100% shares of domestic firms), For investment projects, domestic machinaries and tools which attained the high quality standards equivalent to imported machinaries are recommended rather than foreign s tools. After Vietnam joined WTO, the im-export tax rate of beer has decreased from 80% to 65%, and will continue to decrease to 35% within 5 years. Currently the tax tariff of 65% is still very high, and international companies are usually joint ventures with domestic producer in order to avoid this type of tax. Vietnam is implementing Special Consumption Tax with high value, luxurious goods and all of the alcoholic drinks. However due to the protection of the Government, the products for low income market, mostly beverages produced by domestic factories, serving the low income customer segment such as draft and draught beer,wine, cigarette only have been subject to the special consumption tax of 30% in 2006, 2007 and 40% from This tax rate is much lower in comparison with the 75% rate of bottle or canned beers. 2

3 FPT SECURITIES JOINT STOCK Joining WTO has forced the Vietnamese Government to change some type of protecting tax, within 3 years after joining WTO (by the end of 2009) Vietnam will implement only 1 level of special consumption tax for all types of beers, wines (with the alcoholic level more than 20%) regardless of packaging methods. This tax rate will eliminate the discrimination between canned imported beers and domestic draught beers, or between imported wines with higher alcohol level than domestic wines, therefore this tax rate will improve the competitiveness within the industry. Suppliers Vietnam has more than 400 beer factories all over the country, mostly concentrating at 2 largest cities: Ho Chi Minh and Hanoi. The total consumption level of the market is 2,3 billions USD and the production capacity is estimated about 1,7 billion litres in The average growth rate of Vietnamese beer industry is about 18% per year from 2002 to 2006 and according to the Ministry of Industry, it is expected to reach the 3.5 billions litres level in 2010 equal to 40 litres per person. In 2006, each Vietnamese citizen consumed about 15 litres of beers per year, on average. However this rate is forecasted to increase to 28 litres in The Young market and the event of Vietnam joining WTO open up many opportunities for investments, especially for foreign investors, even though they still not permitted to possess 100% domestic business in this industry. Most of the factories in the industry are having low capacity and out dated technologies. The ministry of Industry is encouraging for improve productivities and quality control, making domestic companies to upgrade their machinaries and production processes, investing on improve the management and quality control process. This has encouraged foreign investors to joining the market under encouraging business form such as joint ventures. Cities and provinces which posses the highest capacity of production are:: Ho Chi Minh city with 23,2% of the total capacity of Vietnam; Hanoi: 13,44%, Hai Phong: 7,47%; Ha Tay: 6,1%, Tien Giang: 3,79%; Hue: 3,05%; Da Nang: 2,83%. (Theo Euromonitor) Manufacturers SABECO VBL - Vietnam Brewery Ltd. HABECO Thanh Hoa Beer Main Products 333 beer, Red Saigon, Blue Saigon, Exporting Saigon Heineken, Tiger, Ankor, Bivina, Amber Stout, Coors Light, Foster, BGI, Larue Export Hanoi Beer, Draught Beer Hanoi beer, Thanh Hoa beer (Draught, bottled, canned) Capacity (Millions litres/year) Market share % Location HCM, Can Tho, Soc Trang, Yen Bai Type of business Joint stock company,originally state owned company % HCM, Ha Tay Joint Venture >200 10% Hanoi, Hai Duong 100 6% Thanh Hoa Joint stock company,originally state owned company Joint stock company,originally state owned company San Miguel Viet Nam San Miguel 50 7% Nha Trang Foreign Capital Joint venture of South East Asia Beer and Viet Ha Halida, Carlsberg N/A 5% Hanoi Joint Venture Beer Hue Beer Huda, Festival 100 3% Hue Joint Venture Joint venture of Vinamilk and SABMiller Zorok 100 N/A Binh Duong Joint Venture Source: Ministry of Industry and Trade, Vietnamese Brewery Association 3

4 FPT SECURITIES JOINT STOCK Products and market segmentation: Bia Hoi, Mainstream and Premium Beer are the three key market segments. Bia Hoi or Draught Beer is unsterilized, sold by draught or the jug. Mainstream is canned or bottled sterilized beer. Premium beer includes international or domestic high-end brands. Bia Hoi accounts for 43% of the consumed volume and 30% in term of value. This high market position of the draught beer is because of the fact that their customer is the average customer segment in the market, with the low price of around VND per litres. This type of beer are usually produced by small local factories, however, Habeco has gained the market leader position in this segment in Hanoi and northern provinces. Mainstream segment is occupying the number one position of the market with the consumption volume of 45% and 50% in term of value. These product tends to appeal more to Vietnam s growing middle class, which are increasing due to the economic development. With price about VND per litres, the segment is dominated by large domestic players such as Sabeco, Habeco and Hue Brewery. The smallest market segment is Premium beer with relatively high price of VND per litre. Occupying 12% of the volume and 20% in term of value. This type of product appeal largely to the upper-middle and upper class consumers. Leader of thes market is some famous brands such as Tiger, Heineken which have been distributed by VBL, and Carlbergs of the South East Asia Beer factory, there are also Vietnamese brands such as Red Sai Gon and 333 of Sabeco. (Statistic of Euromonitor, 2006) Focus on the middle class customer, currently, domestic beer still having the highest demand.this segment including many large companies such as Sabeco with the Blue Saigon, Habeco with hanoi beer and the Hue beer factory with Huda and Festival brands. Manufacturing technologies According to the Ministry of Industry and Trade, currently only factories with the capacity of over 100 millions litres per year are being able to possess modern machinaries imported from developed countries. Some of the large companies who are preparing for the joining such as Sabeco Habeco, are continously investing on buying new machines, with the high technologies levels similar to many joint ventures and also ensure of the hygiene and safety of beer. However, small local factories often faces many problems because of the out-dated technologies and the hygiene issue. In the future, when the protection tax rate is removed, these factories are on the edge of stopping operation. Material The material using for the industry still heavily relying on import, about 60-70% of the raw materials for beer production are imported of which the main material is malt. According to the Vietnam Brewery Association, each year we import about to tons of malt, on average, equal to 50 millions USD. It is forecasted that in 2010 the amount will increase to 100 million USD each year. Importing Malt can be replaced by malts produced by domestic cultivated barley, however the planting of barley is still on the experimentation process, therefore this solution still not practical. Stocks of the beer industry Currently in the OTC market, the shares of 2 market leaders of the beer industry are being trading are Habeco and Sabeco (are joint stock companies) with the price from 34,000 VND/ share to 36,000 VND/share. In addition, there are also Halico and some of the subsidiaries of Habeco and Sabeco has been equitized, however their liquidity still not very high, such as: Ha Noi - Hai Duong, Asia Beer, Ha Noi-Hai Phong Beer, Sai Gon-Can Tho Beer, Sai Gon-Nghe Tinh beer, Sai Gon-Soc Trang beer, Nghe An beer. Etc. 4

5 FPT SECURITIES JOINT STOCK INTRODUCTION ABOUT Establishment and Growth: Formerly Thanh Hoa beer factories, is a state-owned company established in 1989 of the People Committees of Thanh Hoa Province. In March/1996, the company has changed it name to Thanh Hoa beer In 2001, THB was an independent company under the Vietnam Beverage Groups In May 2003, THB became a member of the Hanoi Beverage Company (Habeco) In 01 April 2004 THB changed to Thanh Hoa Beer Joint Stock Company. In 2006, establishment of the subsidiary: Hanoi-Thanh Hoa Joint Stock Company. In the beginning of 2007, the company built the subsidiary Thanh Hoa hotel. In July 2007, The company contribute their capital on establishment the Thanh Hoa Beverage Joint Stock Company. In May 2008, the company contribute capital to establish the Thanh Hoa-Nghi Son Beer JSC. Company Achievement The business in the 3rd largest group in the beer industry, owning 02 production lines imported from Germany with the capacity of 100 million litres/year. The revenue account for about 7% of the market share, implemented the high quality management system, developing the market and the distribution channel Thanh Hoa Beer Product Gold Medal of the High quality Vietnamese Product; Receiving the Second and third level of Honouring Medal for Labour; the emulative flag of the Government and Ministry of Industry.. In 2009 the company planning to establish a new subsidiary which is Ha Thanh Technology JSC. Production and Business Performance The company position: THB has the history of more than 20 year operated in the industry with the core product of Thanh Hoa Beer. The company also possesses a high technologies manufaturing process and many experiences in the industries. THB has proved their advantage of high product quality, and have been chosen to be the factories to produce Sai Gon and Ha Noi beer (2 biggest brands in the middle class market segment, have been recognized and favourited by more than 90% of Vietnamese consumers). In addition, the Thanh Hoa beer product, (bottled, canned, draught, Box and Pet beer) also prove its advantage through the product quality and favour, which is very appropriate with the comsumers taste, and the price reasonable for consumers in Thanh Hoa province and the vicinity. Products: The company has successfully produced 2 products Sai Gon beer and Ha Noi beer. And Currently the company is owning the Thanh Hoa beer brand, a familiar brand for the consumers in Thanh Hoa province and the vicinity. Bottled Sai Gon Beer In 2006 and 2007, Sai Gon beer account for 40% and 29% of THB revenue, respectively. From 2008, THB will not continue to produce Sai Gon beer anymore (due to restructuring, now Habeco and Sabeco became two seperate Corporation, and THB is member of Habeco). Bottled Ha Noi Beer In 2006 and 2007, Sai Gon beer account for 29% and 38% of THB revenue, respectively. In 2008, this figure has significantly increase to nearly 70%. Thanh Hoa Beer - Main Product: Bottled beer with the volume of 330ml and 450ml; Pet and Box beer with the volume of 20l or 30l. 5

6 FPT SECURITIES JOINT STOCK - Revenue: Account for about 30% total revenue (quite stable in 2006, 2007 and 2008). - High quality assurance, in the production lines and technologies system of which Hanoi and Sai Gon Beer are being producing. - Price: the price is reasonable with the majority of people in Thanh Hoa and the vicinity, the brand name has been proved and the products of Thanh Hoa beer have fastly increase its market share in Thanh Hoa and the vicinity market. Source of Material: Main material that THB using in producing beer is malt, rice and houblon. Malt are mainly imported from Australia, Denmark and France. Rice 100% domestically bought and Houblon imported from Germany. In addition, there is also about 41 other ingredients which are dosmestically supplied. Quality Control: According to the ISO standard and the controling system of Hygiene and safety in foods and beverages HACCP. Business Development: THB focus on producing the product of Hanoi beer and Thanh Hoa Beer, and expanding the market into Japan and Campuchia (THB is negotiating with Japanese partner to considering for the contract of producing Japanese Beer in Vietnam, and export to Campuchia). THB has contributed the capital to Thanh Hoa Nghi Son JSC with the rate of 51%. The Thanh Hoa Nghi Son JSC having the capital of 10 billions VND, has finished the first stage of the investment on the area of 8 hectare in the Nghi Son industrial zone with the total level of investment nearly 60 billions, the technical system imported from Germany with the capacity up to 25 millions litres/year. THB has contributed the capital to Ha Noi-Thanh Hoa JSC with the rate of 51%. This subsidiary of THB having the registered capital of 5,84 billions VND and playing the key role in organizing for the distribution channel of the Thanh Hoa Beer Product. THB has contributed the capital to Thanh Hoa Beverage JSC with the rate of 51%. his subsidiary of THB having the registered capital of 920 millions VND currently owned and exploiting the mineral water source in Hoang Hoa. THB do not expand their business to other industry except for beverage and food, and also do not having the plan for finance investment such as buying shares of other companies. Technology: The capacity of production of the current system is: 100 million litres/year. Some months peaked at the capacity of 10 million litres/month. In general, the company machines and technologies is at the high and advanced level in comparison with other brewery companies. o Production Line (Brewhouse) I: o o Boiling Factory: the machines has been renewed in 2004 which has been produced and assemblied by the Dolyco group. Filtering machine produced by Steniker of Germany in Pumpers and antipyretic machine imported from German in The control system mostly automated with advanced software. Enzyming factory: increasing the enzyming processes with water, the system of pipelines, valves, pumpers imported from Germany. Kisnger filters also made in Germany (02 filters, produced in 1995 and 2004) Production line (Brewhouse) II: Produced and implemented by Steniker of Germany in this system is fully automated and is one of the newest technologies that have been applied in the Vietnam beer industry Beer Filtration Process: 6

7 FPT SECURITIES JOINT STOCK Beer Filtration Process 1: Produced by Krones of Germany and implemented in 1997 with the capacity of bottles/h. This process has the advantages of: high accuracy, ensure the purita of the products, the trustworthiness of the production lines. Beer Filtration Process 2: Produced by Krones of Germany and installed in 2008 with the capacity of bottles/h. This lines is considered the most modern technology in Vietnam currently. With the current processes and technologies, the company is satisfied all requirements and fully capable of producing high quality beer such as Sai Gon Beer, Hanoi Beer, and other type of beers for exports. Consuming Market: The revenue structure according to the product lines of THB is as following: Products line First 10 months of 2008 Thanh Hoa Beer 31,03% 33,23% 29,40% Hanoi Beer 29,10% 38,23% 70,60% Saigon Beer 39,87% 28,54% 0% In 2008 and expected in 2009, contract for producing Sai Gon beer with Sabeco will be cancelled and replaced by the increasing orders from Habeco. However in the future, when Habeco open new factories for productions, THB will have to gradually increase their market and partners rather than relying too much on Habeco contracts. THB has been negotiating with Japanese partner and the Campuchia market in order to implement the plan of expanding order with others partners. In addition, the Thanh Hoa province market with the characteristic of a high population market will also be a potential market for THB to increase the revenue of the Thanh Hoa Beer products. Financial Status and the effectiveness of Business Unit: thousand VND Items T F 2009F Total Assets 224, , , , ,161 Current Assets 153, , , , ,000 Non-current Assets 70, , , , ,161 Total Debts 100, , , , ,213 Short-term debts 91,948 96, , , ,246 Loan 5,000 36,600 52,647 64,257 31,132 Long-term debts 8,358 21,986 49,267 46,267 33,967 Owners' equity 124, , , , ,948 Chartered capital 63, , , , ,245 Total revenue 489, , , , ,000 Net revenue 302, , , , ,680 Gross profit 70,426 84,120 50,629 65, ,243 Profit before tax 44,961 51,006 17,587 29,370 49,669 Profit after tax 44,582 43,802 15,805 24,671 37,252 Dividend 18% 12% 18% Growth rate Total Assets 31% 32% 16% -7% Owners' equity 39% 2% 6% 8% 7

8 FPT SECURITIES JOINT STOCK Net revenue 15% N/A 26% 15% Profit before tax 13% N/A -42% 69% Profit after tax -2% N/A -44% 51% Profitability ratio Profit before tax/current assets 71% 45% 15% 26% 43% ROE 36% 29% 9% 14% 19% ROA 20% 17% 5% 6% 9% Profit before tax/net revenue 15% 15% 6% 8% 11% Other information related to valuation No of shares ending 6,312,500 11,424,500 11,424,500 11,424,500 11,424,500 Average number of shares outstanding 6,018,950 9,334,981 11,424,500 11,424,500 11,424,500 EPS Source: THB; FPTS Healthy financial status, the high quality of the asset items, the value of fixed assets is much lower than market value Most of the THB receivables are from Habeco with the average cycle of one month. Inventories are mostly raw material for productions according to the production plans and the replacing tools, there is no low quality inventory. THB do not have any items under short term financial investment on share of others companies. Through many years, the company always is rated at A level customer by the banks. The net value of the fixed assets are much lower than the market value because the company has applied the policy of accelerated depreciation in the previous period, (5 years on average) in comparison with the capacity and ability to so use in production of the investing machineries and tools (about 15 years). During last November, THB has successfully in negotiating for resell of the bottle filtration process with the price which is 10.5 billions higher than the booked value of 2,075 billions VND. Reason for decrease in profit in 2008 The main material THB uses in production are malt, rice and houblon. This group of material account for 70% of the cost of goods sold, in which 70% to 75% is Malt; 25-30% is rice or substitutions. In 2008, THB has been seriously affected by the increase in input material cost. While the selling price of the output products only slightly increase (about 10%). In comparison with the average price of 2007 and the first 9 months of 2008: the price of Malt increased 38%; Houblon increase by 190%; rice increase by 50%. The escalade in the input materials cost has severely affected the cost structure of the THB s products: the gross margin for the first 9 months of 2008 is about 83%, much higher than the stable rate of 76% in 2006 and In 2008 THB also being affected by the increase in the interest rate, while THB is focusing on investment for new beer extraction process (about 80 billions VND) and the head office building (about 10 billions VND). In details: net expense for the financial activities in the first 9 months of 2008 is 6,399 billions, much higher than the level of 3,853 billions in Reason for the recover of the growth rate of profit in the company financial forecast According to the forecast of the specialists in the industry the price of Malt, Houblon in 2009 will decrease for about 20%, therefore, it will be the opportunity for THB to increase their profit in 2009 in comparison with The lending interest rate of banks are decreasing is also one of the reason for the increase in profit in In addition up to the end of 2008, THB still have many machines that have been fully depreciated in value but still being able to use for production. The reason is that in the previous years THB has applied the policy of quickly depreciate with these tools. On average, the machines for beer producing from Germany can be use from 12 to 15 year. In the period before 2008, THB has applied the depreciation methods that calculated the average depreciation for 5 years with these tools (especially with the tools that have been invested in 2004). For the new processes and production lines bought in 2008, THB applying the depreciation methods that calculated the average depreciation for 7 years. 8

9 FPT SECURITIES JOINT STOCK SWOT Analysis Strengths Strong Brand name, has been established since 1989, especially has successfully produce high volumes of Hanoi and Sai Gon Beer. Is subsidiary of which Habeco owned 55% of share, therefore can assure of a main percentage of the output is the Hanoi Beer. High technology systems, importing from the leading company of Germany in the beer producing machines industry The machinaries which has been depreciated in the past is an advantages to increase the company profitablity from The Product Thanh Hoa Beer with high quality, low price, and very popular in the local area- the Thanh Hoa city with high population, convenience traffic and stable GDP growth The distribution channel all over the Thanh Hoa Province has created a competitive advantage for the product Is a strong business of Thanh Hoa province, contribute a large amount of money to the treasury budget, therefore the company has been granted by the gorvenment with many favourable condittions Quality control system ISO 9001:2000 and HACCP helping the production control system of THB become more completed, ensure the quality of product and efficiency in operation. Oppoturnities High potential beer and beverage market because of the population of more than 80 millions people of Vietnam is still growing, and the warm weather condition through out the year, 22 to 27 C degrees on average. Opportunities for exporting still very high because the productivity still have not being able to satisfy the demand for exporting. Expand and penetrating on the northern area market utilized the brand name which have been built and the trend of M&A in order to take over smaller factories in this market. Developing others product lines such as wines, mineral water, utilizing the current distribution channel, measurement tools, and the human resources. By the end of 2009, Special Consumption tax for different types of beers will be united into one single tax rate creating an opportunities for free and fair competition The potential of attracting new investment sources in large scale and high volume through the stock market. Weaknesses The output is too depend on Habeco. Domestic suppliers still account for a very small percentage. Not yet having any exporting product therefore have to bear the high exchange rate risk and fluctuation in raw material cost risk The products quality still at a normal level have not attained the desired high quality level Simple items on financial investment structures basically termed saving, therefore the profitability is low. Distribution channel mainly through the wholesaler channel, have to go through many intermediates until the products reach the end user, therefore make the final price increased. The training of employees still has not met the demand of business activities. Difficulty in modernizing the management system when changing from the state owned organization. Threats The raw material cost is having the trend of increasing each year, the strategies of maintaining a stable output price has affected the company profitability. The products are produced in different factories therefore somehow make it difficult for production control Fiercer competition after the Government remove all the protections with the investment on the beer industry, and following the WTO commitment, specifically is decrease the import tax for the products, increase the probabilities of many strong brands in the world on the domestic market. Unfair competition due to the fact that tax avoidance, and cheating in business still happens in the Vietnam Beer industry. 9

10 FPT SECURITIES JOINT STOCK Risk Analysis: Economy Risk: the company products are consumer product which highly depend on the income and the change in the consumer preference and tastes. The demand for this type of product will remain high when the consumer income increase and they have the ability to adopt for luxurious goods. However when the economic on crisis, the demand will decrease faster than others essential goods Exchange rate risk and material cost risk: because of the industry production activities depend a lot on the imported material, therefore, when there is a great change in the foreign exchange rate, or when the cost of the raw material increase, the company cost will cosiderably increased. Market Risk: with the joining to WTO of Vietnam in 2007, the companies in the beer industry will have to face with the severe competition from foreign firms, especially after the Gorverment removed all of the tax protection, this pressure of competition will strongly increase. FPT Securities Joint Stock Company Head Quarter: Floor 2 71 Nguyen Chi Thanh Dong Da Dist. - Ha Noi - Viet Nam Tel: (84.4) / Fax: (84.4) FPT Securities Joint Stock Company Ho Chi Minh City Branch: 31 Nguyen Cong Tru Dist. 1 Ho Chi Minh City - Viet Nam Tel: (84.8) Fax: (84.8) FPT Securities Joint Stock Company DaNang City Branch: 09 Nguyen Van Linh-P. Nam Duong-Hai Chau-Đa Nang-Viet Nam ĐT: (84.5) Fax: (84.5) ANNOUCEMENT This report is made by the Corporate Finance Department of the FPT Securities, providing information for investors who have the trading account in FPTS in order to evaluate about trading of the newly listed company consulted by FPTS. This report will not be reproduce, distribute, or issue, fully or partially for any other reason without the permission document of FPTS. DISCLAIMER OF LIABILITY All of the information and analysis on this report are made by FPTS basing on the information sources that the company provide to us and others reliable sources, available and legal. Except for information about FPTS, we are not guarantee about the correctness or completeness of this information. Investors who using this report need to note that all of the comments and opinions on this report only the subjective opinions of FPTS. The investors have to take their own responsibility about their decision when using this report. Copyright 2008 FPT Securities Joint Stock Company 10