Brian Jeffrey
The spice market in Vietnam is experiencing significant growth, with retail revenue reaching 39.9 trillion VND (US$1.6 billion) in 2023, showing a 9% increase from the previous year, as reported by Euromonitor.
Projections indicate that the spice segment will continue to expand at a compound annual growth rate (CAGR) of 11% in value, reaching 65.8 trillion VND (2.6 billion USD) from 2009 to 2028.
While Masan Group continues to dominate the market with a 30% market share, particularly in fish sauce, soy sauce, and chili sauce segments, a rising contender has entered the spotlight with lofty ambitions.
In a recent surge, the stock value of Cholimex Food Joint Stock Company (Cholimex Food) has seen a remarkable increase. On June 26, CMF shares surged by 15%, or 32,900 VND, to reach 252,400 VND per share.
This rise in stock value positioned CMF as the third-largest on the Vietnamese stock exchange, surpassing Halong Beer and Beverage Joint Stock Company (UpCOM: HLB).
Subsequently, by July 8, CMF shares soared to 262,000 VND per share, surpassing VE4 of VNECO4 Power Construction Joint Stock Company (HNX).
As of now, CMF boasts the second-highest stock price in Vietnam, trailing behind only VNG Corporation (UpCOM: VNZ) of Le Hong Minh, which closed at 570,000 VND per share on July 8.
The notable appreciation of CMF’s stock price and its upward trajectory with low liquidity can be attributed to its concentrated shares, with significant holdings by three major shareholders accounting for 92.55% of the company’s capital. Furthermore, CMF has displayed strong business performance with consistent revenue and profit growth, as well as offering high dividends.
Established in the late 1980s, Cholimex Food has made a mark in the market by supplying products such as soy sauce, chili sauce, and fish sauce. It competes alongside major companies like Masan, Trung Thanh, and Nosafood, distributing its products through popular channels like Metro, Co.op Mart, and BigC.
A distinguishing feature of Cholimex Food is its leading role in providing spices to prominent international brands such as Haidilao, Pizza Hut, Popeyes, Domino’s Pizza, and Jollibee, renowned fast-food chains from countries like the US, China, and the Philippines.
In terms of the shareholder structure, Cholon Import-Export and Investment Corporation (Cholimex) owns 40.72% of Cholimex Food’s shares, followed by Masan Food Company Limited at 32.83%, and Nichirei Foods Inc at 19%.
In 2014, Masan Group, led by billionaire Nguyen Dang Quang, attempted to acquire 49% of Cholimex Food’s shares at 90,000 VND per share to expand its influence. However, major shareholders Cholimex and Nichirei Food did not approve the offer. Presently, Masan remains a significant shareholder in CMF.
In 2023, Cholimex Food declared its 14th consecutive year of revenue growth, reaching 3.41 trillion VND (a 5.9% increase from 2022) despite challenging global economic conditions and subdued domestic consumer demand. CMF has surpassed 200 billion VND in profit annually over the past two years.
With a target of 3.85 trillion VND in revenue for 2024, CMF, under the leadership of Chairman Huynh An Trung and CEO Diep Nam Hai, envisions a fivefold increase in revenue from the current level within five years. In the short term, CMF aims for 10 trillion VND in revenue, with a significant contribution expected from a new frozen food line at its recently established factory in Vinh Loc 2 Industrial Park (Ben Luc, Long An province) with a total investment of 850 billion VND.
Benefiting from the thriving spice industry, CMF is capitalizing on the growing demand for convenient spice products like sauces and marinades along with increased exports to various countries in Europe, North America, Australia, and South Korea.
However, Cholimex Food faces intense competition from industry giants like Masan Group, Trung Thanh, and Nosafood. Masan, led by Nguyen Dang Quang, is aggressively expanding its market presence and enhancing brand value through the “Go Global” strategy, aiming to elevate Vietnamese brands on the international stage. Without accelerating their development efforts, other industry players risk lagging behind.
