Vietnam's largest company Vingroup receives tougher evaluation because its electric vehicle unit VinFast produces major financial losses. These financial problems are pushing investors to sell shares and forcing Vingroup to pay more to borrow money.  

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Vingroup deals with added difficulties because of Moody's and Fitch's downgrade of its largest profit center Vinhomes to speculative grade. The ratings reflect Vingroup's linked finances with VinFast and its preparation to sell USD 500 million of international bonds. 

Also Read | VinFast secures USD 3.4 billion in additional funding from Vingroup amid rising losses

Head of Luther International in Vietnam Leif Schneider believes Vingroup's tested financial strength will define how this year impacts its overall financial condition. He said that if VinFast does not deliver better results Vingroup will continue to weaken financially. Schneider recommended that Vingroup would feel better financial health by cutting back its help for its business units.  

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Since establishment Vingroup and CEO Pham Nhat Vuong provided both USD 13.5 billion in support to VinFast and committed USD 3.5 billion more in late 2023. Despite heavy funding support from the company VinFast's investor fears remain visible at their annual meetings during the past two years.  

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Since VinFast made its Nasdaq debut in August 2023 Vingroup's investors have lost 50% of their capital which is now worth USD 6 billion. The company faced a 6.6% stock price decrease during the past year while the Vietnamese market as a whole advanced 7.5% according to LSEG data. Shooters reached their bottom point from 2017 during December before showing improvement.  

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According to Yuanta Securities Vietnam's research head Nguyen The Minh VinFast poses the biggest obstacle facing Vingroup. Despite the challenges VinGroup remains determined to back the company. "Vingroup remains steadfast in investing resources to enhance our subsidiary's operations" we declared in our official statement Wednesday.  

Vingroup remains optimistic about the growth prospects of its other business units in 2024, asserting that such performance could attract fresh investment. However, investor confidence in VinFast’s ability to deliver sustainable results remains uncertain.