The share sale is expected to be completed in the first half of this year.

Bach Hoa Xanh: Share sale expected to be completed in the first half of this year

A representative of Mobile World Investment Joint Stock Company said that the transaction to sell up to 10% of the chain's capital is expected to be completed in the first half of 2024, but did not share details about the partner due to a commitment to information confidentiality.

In a recent regular meeting with investors, a representative of Mobile World Investment Corporation said that Mobile World Investment Corporation (stock code: MWG) has announced a resolution of the Board of Directors on selling 5-10% of the chain's equity to finance long-term development activities through private issuance to investors.

“This transaction is expected to be completed in the first half of 2024. However, due to the ongoing transaction and confidentiality commitments, we cannot share more information with investors,” the representative said.

Recently, according to Reuters, China's CDH Investments is in advanced talks to buy a minority stake in Bach Hoa Xanh from Mobile World. CDH Investments is one of China's largest alternative asset investment companies and has also invested in Mobile World.

“CDH Investments is looking to buy a 5% to 10% stake,” a source told Reuters, adding that discussions were ongoing and there was no certainty that a deal would be struck. Another source said a deal “could be reached as early as next month if negotiations are successful.”

Talking about the prospects of Bach Hoa Xanh, the representative of Mobile World Investment Joint Stock Company said that Bach Hoa Xanh will start bringing in money for the group from this year and will increase gradually over time. To do that, the management of this chain will continue to upgrade the product portfolio, focusing on product quality, safety and shopping experience to boost revenue. The second thing we will do is control costs, especially logistics costs and store operating costs.

The head of this chain sees that the fast-moving consumer goods and food industry is shifting strongly from traditional shopping to modern shopping channels. The reason for this shift is that the number of young customers is increasing and secondly, consumers are getting busier.

"For old stores, the average revenue target of 2 billion VND per store per month is within reach this year. In fact, many areas have achieved the above target. However, this year Bach Hoa Xanh has opened new stores, so the average revenue per store per month may not be yet. For the Bach Hoa Xanh chain, it is expected to contribute about 30% of revenue, grow double-digit revenue, increase market share and start making profits for the company from 2024. The company also plans to selectively open new Bach Hoa Xanh stores to ensure efficiency, continue to increase revenue of old stores and optimize costs, especially logistics costs, to make a profit for the whole year at the company level. reach 2 billion or approximately 2 billion VND", the representative informed.

Sharing more with investors, Mr. Nguyen Duc Tai - Chairman of Mobile World - said that the group's growth in the next 5 years will depend on Bach Hoa Xanh. According to Mr. Tai, Bach Hoa Xanh does not have a large market share and there are still many opportunities to expand in the provinces and cities where the chain is present as well as in areas where it is not yet present such as the Central and Northern regions.

Last year, Bach Hoa Xanh recorded revenue of VND31,610 billion, contributing 26.7% of the group's total revenue. Average monthly revenue per store reached about VND1.8 billion in the last quarter of 2023, up 9% over the previous quarter and 30% over the same period. The fresh food industry recorded a 35-40% increase in output and sales in 2023 over the same period, while fast-moving consumer goods increased by 5-10%. The total number of purchase invoices for the whole year of 2023 increased by 20% over the same period. At the end of the year, the company had 1,698 stores,

This year, the Bach Hoa Xanh chain is expected to contribute about 30% of revenue, grow double-digit revenue, increase market share and start making profits for the company from 2024. The Gioi Di Dong also plans to selectively open new Bach Hoa Xanh stores to ensure efficiency, continue to grow revenue of old stores and optimize costs, especially logistics costs, to make a profit for the whole year at the company level.

Source