Table of contents

Comment...............................................................................................................1
Introduction...........................................................................................................2
Chapter 1: Information of Hoa Sen Groups (HSG).........................................3
1.1 General introduction........................................................................................3
1.2 Evolution.........................................................................................................3
1.3 Corporate governance......................................................................................4
1.4 Financial situation of the business...................................................................4
1.4.1 Balance sheet................................................................................................5
1.4.2 Income statement..........................................................................................6
1.4.3 Calculate metrics..........................................................................................7
Chapter 2: Financial statement analysis...........................................................7
2.1 Time-series......................................................................................................8
2.2 Cross-sectional................................................................................................9
2.3 Conclusion:......................................................................................................10
References............................................................................................................11

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 COMMENT

ROA Return on assets

ROE Return on equity
P/E Price-earning ratio
P/B Market-to-book ratio
EPS Earning per share
ROS Return on sales

HSG Hoa Sen Group Joint Stock Company

HPG Hoa Phat Group Joint Stock Company

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 Introductions
Financial statements are economic information presented by accountants in the
form of tables, providing information on the financial situation, business situation,
and cash flows of the business that meet the requirements for those who use them
in making economic decisions.
Besides, the income statement is also very important in a company. The monthly
business results report helps us to grasp the business situation of the enterprise,
track the profits, revenue, financial investment expenses in the business activities
of the enterprise. Basic analysis of the income statement usually involves the
calculation of gross profit margin, operating profit margin, and net profit margin,
which each divides profit by revenue. Profit margin helps to show where company
costs are low or high at different points of the operations.
Financial statement analysis is the process of dividing and classifying the system
of indicators reflected on financial statements in different directions and then using
communication, comparison, comparison, and synthesis techniques to provide
useful financial information for management. Financial indicators on the reporting
system include: assets, capital sources, equity ... It comes from the balance sheet.
Sales revenue target, profit from business results report. Quota ROA, ROE, ROS...
Sources of information provided from financial statements.
Financial statements mainly provide information to audiences outside the business,
mainly making decisions according to different objectives.

Role of financial statement analysis:

As a tool of management, financial statement analysis has the main purpose of
helping users with information accurately assess the financial strength,
profitability, and prospects of the business; From there, choose the optimal
business plan

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 Chapter 1: Information of Hoa Sen Group (HSG)

1.1. General Introduction:

Hoa Sen Group Joint Stock Company (Hoa Sen Group) was formerly known as Hoa Sen
Joint Stock Company, established on August 8, 2001. After 17 years of establishment and
development, from a small private equity company with an initial charter capital of
VND30 billion, Hoa Sen Group has risen to become the No.1 steel and steel
manufacturing and trading enterprise in Vietnam and a leading exporter of steel and steel
in Southeast Asia. Hoa Sen Group currently owns 11 large factories and a system of more
than 400 distribution and retail branches spread across the country, Hoa Sen Group's
products are exported to 75 countries and territories worldwide.

With the flexible and creative management of Mr. Le Phuoc Vu and his colleagues, from
a small company with an initial charter capital of VND30 billion and 22 employees, Hoa
Sen Group has risen to become the No. 1 steel and steel manufacturing and steel
manufacturer in Vietnam and a steel exporter, The leading steel in Southeast Asia with a
charter capital of VND 3500 billion, revenue reached nearly VND 20,000 billion, profit
after tax reached more than VND1500 billion, creating jobs for nearly 10,000 employees.
Currently, Hoa Sen Group is the leading steel and steel production and trading enterprise
in Vietnam with a 33.1% market share of steel and 20.3% market share of steel pipes
(According to statistics of Vietnam Steel Association in 2016).
1.2 Evolution:
- 08/08/2001: Hoa Sen Joint Stock Company, the predecessor of Hoa Sen Group was
established with a charter capital of VND30 billion, with 22 employees and 3 branches
- From 2002 to 2003: Increased the number of branches to 34, mainly concentrated in the
Southwest, Southeast and Central Coast
- 08/08/2004: Put into production the color plating line I, design export 45,000 tons/year
- 02/ 2005: Put into operation galvanized Steel Line I, the capacity of 50,000 tons/year in
Tsunami Industrial Zone 2 Binh Duong province
- 19/03/2005: Inaugurated and put into operation NOF technology plating line designed
capacity of 150,000 tons/year
- 11/ 2006: Establishment of Sun Hoa Sen Joint Stock Company with charter capital of
VND 320 billion
- 1/ 2007: Raising the capacity of 2 galvanized ton production lines to 100,000 tons/ year.
At the same time, the Hoa Sen cold-rolled steel factory was inaugurated with a design
capacity of 180,000 tons per year.
- 12/ 2007: Renamed Hoa Sen Group Joint Stock Company
- 05/12/2008: Hoa Sen's shares are officially listed on the Ho Chi Minh City Stock
Exchange. Ancient Code: HSG
- From 2009 to 2010: Increase the charter capital from VND 570.39 billion to VND
1,007.91 billion

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- In 2010-2011: Export revenue reached 101 million USD
- From 2011 to 2019: Received a series of major awards for quality and brand service
.
1.3 Corporate governance:
Become the leading economic group in Vietnam and the region. In particular, the focus is
on the production and distribution of building materials products through a sustainable
development strategy based on a core chain of competitive advantages, in parallel with
the goal of community development, environmental protection, contributing to bringing
the highest value to shareholders, workers, consumers, and society.

Providing products and services associated with the Hoa Sen brand, ensuring
international quality, reasonable price, diverse and environmentally friendly designs,
meeting consumer needs, contributing to changing the appearance of the country's
architecture and community development. Constantly innovating and developing to
affirm the stature and mission of a dynamic, innovative, pioneering Vietnamese
enterprise in both business and community activities, rising to its position in the
international market.
1.4 Financial Situation Of The Business:
1.4.1 Balance sheet:
 Assets:

2018 2019 2020

1. Cash and cash 492,079,830,667 288,707,713,172 574,767,066,704
equivalents
2. Short-term 270,387,032 76,250,000,000 516,043,836
financial
investments
3. Short-term 2,118,733,369,445 1,339,263,670,053 2,024,273,013,463
receivables
4. Inventories 6,606,994,466,635 4,547,528,637,193 5,523,844,442,201
5. Other current 1,581,621,048,212 1,103,902,343,598 898,914,764,198
assets
I. SHORT-TERM 10,799,699,101,991 7,355,652,364,016 9,022,315,330,402
ASSETS
1. Long-term 202,370,220,436 226,761,293,160 184,949,529,000
receivables
2. Fixed assets 8,124,639,435,592 8,642,006,807,601 7,594,742,677,985
3. Investment - - -
Real Estate
4. Long-term 1,512,774,341,255 576,452,872,180 575,955,787,725

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 unfinished assets
5. Long-term 98,957,678,001 17,000,000,000 26,472,160,000
financial
investment
6. Other long- 516,381,284,343 407,565,126,082 351,972,179,819
term assets
7. Trade profit - - -
II. LONG-TERM 10,455,122,959,627 9,869,786,099,023 8,734,092,334,529
ASSETS
TOTAL ASSETS 21,254,822,061,618 17,225,438,463,03 17,756,407,664,931
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 Liabilities and Shareholder’s equity:

2018 2019 2020

1. Short-term debt 12,637,507,361,815 8,767,419,669,924 8,991,488,795,259

2. Long-term debt 3,465,688,980,878 2,989,737,607,465 2,174,180,358,349

I. LIABILITIES 16,103,196,342,693 11,757,157,277,389 11,165,669,153,608
1. Equity 5,151,625,718,925 5,468,281,185,650 6,590,738,511,323
2. Funding sources - - -
and other funds

II. OWNER'S 5,151,625,718,925 5,468,281,185,650 6,590,738,511,323

CAPITAL
TOTAL FUNDING 21,254,822,061,618 17,225,438,463,039 17,756,407,664,931

- The above balance sheet information is taken from the data of the reliable website we
collect data of Hoa Sen Group Joint Stock Company in the period from 2018 to 2020.
- The above balance sheet helps us recognize the fluctuations in assets, liabilities, and
equity of HSG. Help investors monitor the situation of the business regularly. From there,
they can make decisions to invest in the business in the future.

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1.4.2 Income statement:
2018 2019 2020
1. Sales and 34,570,344,557,164 28,081,303,783,088 27,765,155,626,306
service provision
2. Revenue 128,915,208,903 46,528,664,413 234,406,112,472
deductions
3. Net revenue 34,441,429,348,261 28,034,775,118,675 27,530,749,513,834
from selling
goods and
providing
services
4. Cost of goods 30,464,290,088,385 24,836,155,036,672 22,903,482,165,423
sold
5. Gross profit on 3,977,139,259,876 3,198,620,082,003 4,627,267,348,411
sales and service
provision
6. Revenue from 179,498,893,481 63,164,230,629 77,984,494,109
financial
activities
7. Financial 970,732,705,902 802,634,741,872 645,261,573,177
expenses
8. Profit, loss or 514,000,092 - -
loss in joint
ventures or
associates
9. Selling 1,816,042,397,184 1,748,882,841,240 2,221,083,074,110
expenses
10. Business 895,579,880,506 470,700,688,884 459,978,781,905
administration
expenses
11. Net profit 474,797,169,857 239,566,040,636 1,378,928,413,328
from business
activities
12. Other income 56,900,222,229 253,166,267,295 28,617,237,724
13. Other 2,512,931,184 30,663,011,810 31,902,487,528
expenses
14. Other profits 54,387,291,045 222,503,255,485 -3,285,249,804
Total accounting 529,184,460,902 462,069,296,121 1,375,643,163,524
profit before tax
14. Current CIT 95,720,855,600 102,045,530,564 259,835,557,336
expenses
15. Deferred CIT 24,297,904,363 -1,347,738,189 -37,206,411,121

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expenses
Profit after 409,165,700,939 361,371,503,746 1,153,014,017,309
corporate income
tax

1.4.3 Calculate metrics:

2018 2019 2020
I. Liquidity ratio
Current Ratio 0.85 0.838 1
Inventory to working -3.5 -3.22 179.1
capital ratio
Quick ratio 0.33 0.32 0.38
Cash ratio 0.04 0.03 0.06
II. Financial leverage ratio 3.12 2.15 1.69
III. Turnover ratios
1. Inventory turnover 4.61 times 5.46 times 4.14 times
Day’s sales in inventory 87 days 66 days 88 days
2. Receivables turnover 14.8 times 17.9 times 12.5 times
Day’s sales in receivables 24 days 20 days 29 days
3. Asset turnover 1.62 times 1.63 times 1.56 times
4. Working capital turnover -18.8 times -19.8 times 900.6 times
IV. Profitability ratios
ROA (%) 1.93 2.1 6.5
ROS (%) 1.19 1.29 4.19
ROE (%) 7.94 6.61 17.5
Profit margin (%) 11.41 16.81 18.23
GOS (%) 11.55 11.41 16.81
V. Market value ratios

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 EPS (VN đồng) 1,106 877 2,637
P/E 5.89 8.91 8.40
P/B 0.49 0.60 1.49
BVPS 13,386 12,921 14,834

 Based on data collected from the Balance Sheet and earnings reports, we calculate the
indicators needed to be able to assess the future performance and growth estimates of
HSG Group in the 3 years from 2018-2020.

CHAPTER 2: FINANCIAL STATEMENT ANALYSIS

2.1 Time-series:
This is an analysis method based on the company's data for several years. The purpose of
this analysis is to compare the company’s past ratios.

Tim e-s er ies

15.5 20.00%
17.50%
15 18.00%
16.81%
16.00%
14.5
14.00%
14 12.00%
11.55% 11.41%
13.5 10.00%

13 7.94% 8.00%
6.61% 6.50%
14.834 6.00%
12.5 13.386
4.00%
12 2.10% 2.00%
1.93%
11.5 0.00%
2018 12.921
2019 2020

BVPS ROA ROE GOS

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With the chart above, we can easily conduct a time series analysis for 2018, 2019, and
2020:
+ Book value has increased steadily through the years of 2019 alone decreased but not
significantly by 2020 the value soared to 14.834% which means that the value of the
company is being enhanced and will be highly appreciated by future projects. In 2020,
the BVPS index increased slightly compared to 2019.
+ ROA and ROE are two basic metrics commonly used to evaluate a business's
performance.
+ ROA increases year by year, from 2018 to 2020, in 2020 ROA will be 6.50%. In
general, ROA tends to increase slightly from 2018 to 2019 and soar in 2020 by 4.4%. It
means the ability to get a return on a highly effective investment. The highest in 2020
was 6.50% and the lowest in 2018 was 1.93%. If a company doesn't make more money
than it spends on investment activities, that's not a good sign. Conversely, if ROA is
better than borrowing costs, it means the company is making good use of financial
leverage.
+ Similar to ROA, HSG's ROE also increases during this period. In 2019 HSG's ROE
decreased from 7.94% to 6.61%, but in 2020 increased sharply to 17.50%. This is the
most important ratio for shareholders, measuring returns per dollar of capital for common
shareholders. HSG's ROE shows very high stability in the use of capital by shareholders.
Before the complicated development of the epidemic, this index decreased in 2019, ROE
in 2020 increased by more than 11% compared to 2019. This ratio is often analyzed by
investors to compare with other stocks. Stocks in the same industry in the market should
be used as a reference when deciding which company to buy shares.
+ GOS is completely different from ROA and ROE. GOS had no growth in 2018 and
2019. But by 2020 the GOS index will rise sharply to 16.81%
2.2 Cross-sectional:
HSG compared with HPG (three years on average):
HSG HPG
ROEA 10.68% 19.85%
ROAA 10.53% 28.59%
ROSA 2.22% 14.03%
P/E 7.7 9.01
P/B 0.86 1.76
We have the following comments:
- We can see that the ROA and ROE of HSG are very low compared to HPG, which
explains why in recent years, HPS has been used and invested by more people.
-Therefore, the P/B ratio of THEHSG is lower than that of HPG. That is, the book value
of HGS is being underestimated compared to the value of HPG.

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 - The P/E ratio of HSG is lower than HPG's. However, HSG's P/E ratio has increased
sharply year after year, indicating that HSG is having projects that promote the
company's potential
- In 2020, HSG's business is progressing very well, so the company's ROS increased 4
times compared to the previous year's fish. That shows that HSG's business is profitable.
Therefore, in order to assess a company's profitability, it is necessary to consider the
company's ROS.
=> HSG needs to improve ROA, ROS, and ROE to attract more investors. In addition,
HSG needs to maintain operational efficiency to create a competitive advantage over its
peers. However, by 2020, strong growth shows that HSG is highly appreciated in the
market, indicating that investors still believe in the diversified development of the
business in the future. Because HSG currently has projects that will elevate the company
and make a breakthrough in the steel industry of the country.
2.3 Conclusion:
The analysis of financial statements will help Hoa Sen Group Joint Stock Company
identify the strengths and weaknesses of the enterprise. And recognize the ability to
compete with companies in the same industry as Hoa Phat. HSG can develop a
development plan in the near future.

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 REFERENCES

1. CafeF
2. Các chỉ số quan trọng trong phân tích BCTC-tạp chí phân tích tài chính
3. https://s.cafef.vn/hose/HPG-cong-ty-co-phan-tap-doan-hoa-phat.chn
4. https://s.cafef.vn/hose/HSG-cong-ty-co-phan-tap-doan-hoa-sen.chn
5. https://finance.vietstock.vn/HPG/tai-chinh.htm
6. https://finance.vietstock.vn/HSG/tai-chinh.htm
7. Vietstock
8. VNEXPRESS
9. Cophieu68.vn

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