Hoa Phat's steel consumption is the highest in 20 months

In November 2023, Hoa Phat Group (Code: HPG) produced 623,000 tons of crude steel, equivalent to the previous month.

Sales output of hot rolled coil (HRC) steel products, construction steel, high quality steel, and steel billets reached 709,000 tons, up 12% compared to October and up 60% over the same period last year. This is also the month with the highest consumption since April 2022. As for construction steel, high quality steel increased by 21% over the previous month to 410,000 tons.

The group said the domestic construction steel market increased due to the start of the construction season and partly came from solutions to promote disbursement of public investment capital. This leads to consumption in all three regions of Hoa Phat recording growth. Of which, the highest increase was in the southern region, up 47% compared to the previous month.

Hoa Phat HRC Steel last month was equivalent to the previous month with nearly 270,000 tons. Hot rolled steel consumption in the Northern region increased by 55% compared to October.

In addition, the group also provides 37,000 tons of galvanized steel sheets and 73,000 tons of steel pipes of all kinds to domestic and foreign markets. These HRC downstream products achieved growth of 44% and 34% respectively compared to the previous month.

In the past 11 months, Hoa Phat has produced more than 6 million tons of crude steel, down 14% over the same period last year. Sales volume of steel products reached 5.96 million tons, down 10%.

Of which, construction steel and high-quality steel reached 3.3 million tons, down 15% compared to the first 11 months of 2022. Export activities of these types of steel contributed 695,000 tons, down 37%. Steel billets supplied to the domestic and export markets are 109,000 tons.

For HRC steel, sales volume recorded over 2.5 million tons, an increase of 2%. HRC downstream products are galvanized steel sheets reaching 304,000 tons, an increase of 2%. Meanwhile, steel pipe products sold 616,000 tons, down 11% compared to the first 11 months of 2022.

In a recent analysis report from MBS Securities, it is forecasted that by 2024, domestic construction steel prices may recover to 15 million VND/ton (up 8% over the same period) thanks to the increase in world steel prices. and warming demand in the Vietnamese market.

Thanks to supportive policies that can restore the real estate market from mid-2024, apartment supply is expected to grow by 20% compared to 2023 (according to CBRE forecasts), which will boost demand and have a positive impact. to domestic steel prices.

Analysts also estimate that coal and ore raw material prices are expected to decrease slightly by 7% and 6% next year in the context of stable supply and decline in China's demand for crude steel production.

MBS believes that recovering selling prices and cooling raw materials will boost gross profit margins of steel manufacturing enterprises like Hoa Phat.

Vietnambiz