We attended VNM’s analyst meeting on August 6. Overall, the dairy giant has reaffirmed its return in gaining market share. Management remains positive on VNM’s outlook, while being general in disclosing the breakdown of data. Our key takeaways are as follows.
H1 2026 Highlights:
* Revenue: VND34,996bn, up 17.8% YoY.
* Net profit after tax: VND5,643bn, up 38.4% YoY.
* Gross profit margin: 43.1%, up 200 bps YoY.
Economies of scale and product mix are key factors: Vinamilk has spent significant expenses on developing and marketing new and premium products to consumers over the last three years. Now that sales volumes of these new products are growing fast, the company has seen a strong increase in margins.
Outlook and Guidance:
* H2 2026 gross margin outlook to remain stable at levels similar to H1 2026, with no significant fluctuations anticipated. Raw material costs have been locked in through year-end. Input cost increases remain within manageable levels.
* No further price increases are planned: A modest 3-4% price increase was implemented in early April 2026. The strategy focuses on sharing challenges with consumers while driving revenue growth through volume expansion and product mix enhancement.
* Q3 export momentum to remain stable vs Q2. Continuous operations were maintained through alternative shipping routes via the Strait of Hormuz and Jordan.
Domestic Market:
* Domestic revenue up 12.4% YoY (high-single-digit volume growth). Q2 domestic revenue increased 6.5% YoY – Q2 2025 was not a low base like Q1 2025.
* Vinamilk gained market share in many categories in H1 2026 compared to both YoY and end-2025 levels, including fresh milk, but did not disclose the data.
* Core categories (liquid milk, yogurt, adult milk, infant formula) maintained steady growth.
* The premium product revenue share now exceeds a double-digit percentage, higher than last year’s high-single-digit level. These lines expanded distribution, introduced new SKUs, and received positive market response.
* GreenFarm: Triple-digit growth rate.
* Optimum A2 Pro+: After only six months, significantly contributed to the Optimum portfolio with unprecedented growth rates. SKU expansion continues
* Moc Chau Creamery: High-end brand successfully penetrating southern markets through supermarkets and Vinamilk stores, core finished products grew nearly double-digit in H1.
Domestic sales channels: Increasing independence, GT shrank to 65% of sales
* General Trade (GT): 65% of revenue. Despite the declining share, GT remains critically important for at least the next five years. Growth has resumed after restructuring efforts.
* Modern Trade (MT): 19% of revenue, showing significant growth.
* Direct-to-Consumer (D2C): 15-16% of revenue, comprising nearly 950 proprietary stores (targeting 1,000 by year-end) and e-commerce, delivering substantial growth.
Overseas Markets:
* Total revenue: VND8,400bn in H1 2026, up 39.1% YoY
* Direct export revenue: VND4,056bn in H1 2026, up 16.2% YoY, extending the strong growth momentum from 2025, primarily from increasing volumes in existing markets. The Middle East remains the primary export destination.
* Angkormilk (Cambodia): tripling revenue YoY in H1 2026 was from a low base and is unlikely to sustain in coming quarters. However, absolute revenue should at least remain stable.
Driftwood (USA): Growth has been primarily driven by margin improvement from better raw material prices, freight costs, and packaging costs vs 2025.Example in competitive edges:
* First in Vietnam to apply Swedish ultrafiltration technology to create naturally high-protein milk products without added whey protein. This technology enables customized product design (high protein, lactose-free, high calcium, low fat).
* Pioneer in A2 dairy farming to extract A2 protein directly from milk rather than external supplementation. Key products include A2 fresh milk and Optimum A2.
* Gelato ice cream: The Matcha flavor won “Best Ice Cream” and packaging won “Best Packaging” at the Global Dairy Innovation Awards.
Farm expansion and herd growth:
Vinamilk continues expanding its farm network to secure fresh milk supply (which currently exceed 2027’s demand). In 2026, existing farms (e.g., Thong Nhat Thanh Hoa) will see further herd growth, while two new farms are in the pipeline: Tay Ninh 2 (8,000 cows, 678 hectares, following Tay Ninh 1's existing 8,000-cow herd) and an upcoming Binh Dinh farm. These investments are expected to secure fresh milk supply through 2028.
Dividend Policy:
* Shareholders’ resolution maintains dividend payout at minimum 50% of net profit after tax.
* More details on dividends to be announced in Q3 or Q4.
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