(TIỂU LUẬN) NAM KIM GROUP nam kim steel joint stock company (trademarked “tôn nam kim”)

In 2011, Nam Kim Steel Joint Stock Company wasofficially listed on the stock exchange on January 14, 2011, with the stock code NKG.. 1 in Lot B2.2-B2.3, Road D3, Dong An 2 Industrial Par

NAM KIM GROUP

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Table of Contents

I INTRODUCTION

1.1 About Nam Kim

Nam Kim Steel Joint Stock Company (trademarked “Tôn Nam Kim”) is not only the leading

group that provides companies with solutions based on technology platform 4.0 – shared economictechnology network but also, the multidisciplinary economic group with a diverse ecosystemconsists of 12 member companies covering 12 different sectors: mining, technology, investment,real estate, logistics, food, and communications As of not long ago, their products are completelycross-country trusted and exported to over 50 nations trillions throughout the world

Established on December 23, 2002, in Vietnam according to the provisions of the enterprise, thecertificate of registration no 3700477019 issued by the Business Registration Office - Department

of Planning and Investment of Binh Duong Province for the first time on December 23, 2002, theregistration for the 25th change, July 25, 2019 In 2011, Nam Kim Steel Joint Stock Company wasofficially listed on the stock exchange on January 14, 2011, with the stock code NKG

The headquarter is at Lot A1, Road D2, Dong An 2 Industrial Park - Hoa Phu Ward - Thu Dau MotCity - Binh Duong Province

Expanding new factory construction and Recorded on the stock trade

Construction of Ton Plating Factory No 1 in Lot B2.2-B2.3, Road D3, Dong An 2 Industrial Park,Hoa Phu Ward, Thu Dau Mot Town, Binh Duong Province, and then in 2011, Nam Kim Steel JointStock Company was officially listed on the stock exchange with the stock code NKG

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Nam Kim 2 Factory began operation and increased production capacity up to 350,000 tons per year.

2 years later, Commencement of Plating Steel Factory No 3 in Lot A1, D2 Street, Hoa Phu Ward,Thu Dau Mot City, Binh Duong Province

Groundbreaking ceremony of Long An pie factory at Vĩnh Lộc industrial park, Long An province.From that point forward, Galvanized Steel House No 2 authoritatively came into activity,expanding the capacity up to 650,000 tons/year

There are 3 types of products that accomplish high production capacity each year: Galvanized steelpipe, pickled oiled steel coil, and COATED STEEL COIL accounting for 120,000 tons per year,800,000 tons/year, and 1,000,000 tons/year respectively

1.3 The company’s external audit firm

The company's external audit firm is a restricted risk organization PwC (Vietnam)

PwC is perceived as the main M&A (Market and Annex) monetary consultant by numberarrangements for the Asia-Pacific district in 2020, positioned by Mergermarket, Bloomberg LP, andThomson Reuters

1.4 Main business field

● Manufacture of other metal products n.e.c

● Producing iron, steel, cast iron

● Wholesale of metals and metals

● Mechanical; metal treatment and coating

● Other specialized wholesale not elsewhere classified

Charter capital: 1.819.998.680.000 VNĐ (One thousand eight hundred nineteen billion nine

hundred ninety-eight million six hundred eighty thousand dongs even)

In 2020, Nam Kim ranked 113th in the list of 500 largest enterprises in Vietnam, down 26 places compared to 2019 and the company currently manages the operation of 4 factories with a total

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capacity of 1 million tons of final plating products per year Moreover, in the past pandemic years,

it has damaged the Vietnamese economy, but Nam Kim company has remained stable and earned

revenue of up to VND11.613 billion Besides, Nam Kim’s products have been trusted and used in

the domestic market and also exported to more than 50 countries around the world to Australia,

Europe, America, Southeast Asia, South Asia, the Middle East, and Africa

1.5 The stock:

On January 14, 2011, the company's shares were listed and traded on HOSE, and Nam Kim Group's

stock code is NKG

1.6 The company’s Board of Directors (BOD)

1.7 The majority-owned subsidiaries of Nam Kim group are:

+ Nam Kim Steel Pipe Co., Ltd (Long An Pipe Factory)

+ Nam Kim Chu Lai Steel Pipe Co., Ltd (Chu Lai Pipe Factory – not yet

operational)

II ANALYSIS OF PROFIT/LOSS AND BALANCE SHEET:

2.1 THE MOST RECENT YEAR-END BALANCE SHEET:

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The amount of total current

4,102,006,090,537 4,435,465,874,629 4,492,264,536,968 assets

Fixed assets 3,532,029,376,931 3,457,519,368,197 3,126,532,591,606Account receivables (long-term) 3,435,857,850 3,453,843,850 3,470,966,092Construction Work-in-Progress 443,787,276,170 49,070,606,991 58,575,728,261Long-term financial investment 9,190,000,000 48,370,000,000 23,180,000,000Other non-current assets 31,569,066,063 70,478,409,601 59,069,502,321

The amount of total 4,020,011,577,014 3,628,892,228,639 3,270,828,788,280 non-current assets

Total stockholders' equity 2,971,176,971,365 3,016,814,179,518 3,181,020,162,631

Total liabilities and equity 8,122,017,667,551 8,064,358,103,268 7,763,093,325,248

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Year 2018 (VND) 2019 (VND) 2020 (VND) ASSETS

Cash and cash equivalents 492,079,830,667 288,707,713,172 574,767,066,704Short-term financial investments 270,387,032 76,250,000,000 516,043,836Account receivables (short-term) 2,118,733,369,445 1,339,263,670,053 2,024,273,013,463Inventories 6,606,994,466,635 4,547,528,637,193 5,523,844,442,201Other liquid assets 1,581,621,048,212 1,103,902,343,598 898,914,764,198

The amount of total current 10,799,699,101,991 7,355,652,364,016 9,022,315,330,402 assets

Fixed assets 8,124,639,435,592 8,642,006,807,601 7,594,742,677,985Account receivables (long-term) 202,370,220,436 226,761,293,160 184,949,529,000Construction Work-in-Progress 1,512,774,341,255 576,452,872,180 575,955,787,725Long-term financial investment 98,957,678,001 17,000,000,000 26,472,160,000Other non-current assets 516,381,284,343 407,565,126,082 351,972,179,819

The amount of total 10,455,122,959,627 9,869,786,099,023 8,734,092,334,529 non-current assets

Total stockholders' equity 5,151,625,718,925 5,468,281,185,650 6,590,738,511,323

Total liabilities and equity 21,254,822,061,618 17,225,438,463,039 17,756,407,664,931

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NKG HGS Difference (in

percentage) between two

Total current assets 4,102,006,090,537 10,799,699,101,991 37.983%Total non-current assets 4,020,011,577,014 10,455,122,959,627 38.450%Total current liabilities 3,924,411,209,320 12,637,507,361,815 31.054%Total non-current liabilities 1,226,429,486,866 3,465,688,980,878 35.388%Total stockholders’ equity 2,971,176,971,365 5,151,625,718,925 57.675%

Difference (in percentage) between two

Total current assets 4,435,465,874,629 7,355,652,364,016 60.300%Total non-current assets 3,628,892,228,639 9,869,786,099,023 36.768%Total current liabilities 4,342,498,959,228 8,767,419,669,924 49.530%Total non-current liabilities 705,044,964,522 2,989,737,607,465 23.582%Total stockholders’ equity 3,016,814,179,518 5,468,281,185,650 55.169%

percentage) between two

Total current assets 4,492,264,536,968 9,022,315,330,402 49.791%Total non-current assets 3,270,828,788,280 8,734,092,334,529 37.449%

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Total current liabilities 4,097,976,895,372 8,991,488,795,259 45.576%Total non-current liabilities 484,096,267,245 2,174,180,358,349 22.266%Total stockholders’ equity 3,181,020,162,631 6,590,738,511,323 48.265%

2.1.1 Total current assets

Statistically speaking, the current assets of Nam Kim (NKG) experienced steady growth throughout2018-2020, while Hoa Sen (HSG) current assets witnessed a drop of 3,444,046,737,975 VNDbetween 2018-2019 Overall, even though Nam Kim did not own as many assets compared to thesaid competitor, the company did a fine job staying on track with the slow but steady increases ofthe liquified assets

2.1.2 Total non-current assets

NKG’s non-current assets figures in the period of 2018 to 2020 decreased over time From what can

be seen on the table, NKG’s non-current assets are only about a half of HSG; however, the numbers

in “Long term financial investment” 2020 of both companies was a fair similar amount, in absoluteterms The amount of that category of Nam Kim in 2020 was 23,180,000,000 VND, of Hoa Sen was26,472,160,000 VND Comparing these amounts to the balance sheet total of two companies, this is

a much bigger item for Nam Kim

2.1.3 Total current liabilities

The current liabilities of Nam Kim fluctuate between 2018 to 2020 An insignificant increase of418,087,749,908 VND from 2018 to 2019, then a fall of 244,522,063,856 VND at the end 2020.Hoa Sen’s same category of liabilities went through a decrease of 3,870,087,691,891, a muchbigger drop compared to Nam Kim’s in 2018-2019 In 2020, Hoa Sen’s current liabilities stayedmoderately the same as in 2019

2.1.4 Total non-current liabilities

Nam Kim’s non-current liabilities developed a pattern of significant decrease throughout 2018 to

2020 The amount went down from 1,226,429,486,866 VND in 2018 to 705,044,964,522 VND in

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2019 Then, it continued to drop to 484,096,267,245 VND in 2020 Meanwhile, Hoa Sen’s current liabilities data had a rise in 2019 then dropped in 2020 to 2,174,180,358,349 VND.

non-2.1.5 Total stockholders’ equity

Equity that is stated in the balance sheet is book-value equity The market value of equity of thesecompanies is higher than the numbers that are written in the report Nam Kim Stockholders’ equitywitnessed a rise each year in the three years period, and Hoa Sen followed the same pattern Again,Nam Kim’s total assets were not as big as Hoa Sen throughout the three years of comparison, theirpercentages of stockholders’ equity ratio were much higher than that of Hoa Sen

2.1.6 Common-size balance sheet COMMON-SIZE BALANCE

Total stockholders' equity 36.58% 37.41% 40.98% 24.24% 31.75% 37.12%

Total liabilities and stockholders'

From what can be seen on the common-size balance sheet, in Assets, Nam Kim percentage ofcurrent assets have had a steady and strong increase over the years, from 50.50% to 57.87% in onlythree years; while current assets of Hoa Sen seem to have fluctuated but stayed fairly the same Inpercentages of non-current assets, Nam Kim’s figures decrease along with the increase of thecurrent assets

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In the category of Liabilities, NKG’s current liabilities did not have a significant rise and fall.Comparatively, the rises and falls between the periods are not big compared to the drop of Hoa Sen

in 2018-2019 Non-current liabilities of Nam Kim decreased drastically from 15.20% to 8.74%, andalmost half decreased in one year, and later, another 2.5% decrease in 2020 Hoa Sen figures on thesame period were inverse, a slight increase of 1.05% and eventually dropping to 12.24% in 2020

In stockholders’ equity, Nam Kim had a stable rise from 36.58% in 2018 to 37.41% in 2019 andended up with 40.98% in 2020 This is a 4.4% increase in a total of three years Hoa Sen on theother hand had a large rise, starting at 24.24% in 2018, and ending at 37.12% in 2020, a 12.88%increase Substantially, the increased percent of Hoa Sen was about tripled that of Nam Kim.Considering the number of total assets each company owned at the time, it was clear that thepercentage of Nam Kim equity in total was bigger than Hoa Sen

2.2 THE MOST RECENT YEAR-END OF INCOME STATEMENT

CONSOLIDATED BUSINESS PERFORMANCE REPORT

6 Any non-operating (or

extraordinary) gains and

CONSOLIDATED BUSINESS PERFORMANCE REPORT

4 Others Gains 56,900,222,229 253,166,267,295 28,617,237,724

5 Others Losses -2,512,931,184 -30,663,011,810 -31,902,487,528

6 Any non-operating (or

extraordinary) gains and

2.2.1 Total operating revenues

Nam Kim Steel Company has a change in total

operating revenue in the period 2018 - 2019

Indeed, the company's revenue from sales and

service provision fell by around VND 2,634

trillion in 2019 Alternatively, revenue is 17,8

percent lower this year compared to the same

period last year However, this ratio continues to

decline, falling from 12,177 trillions in 2019 to

11,560 trillion in 2020 However, when

comparing the reduced revenue ratio for the 2019-2020 period to the 2018-2019 period, it is clearthat the ratio has decreased Although revenue was still lowered due to the unanticipated scenariowith Covid-19, the NKG side discovered a solution to mitigate this drop, reducing it toapproximately 617 billion dongs in 2019-2020 Even so, when NKG's revenue reduction iscompared to HSG's in the 2018-2019 period, it demonstrates that Nam Kim Group retains a solidability to manage revenue However, when the figures for 2019-2020 are compared, the picturechanges dramatically

2.2.2 Cost of Goods Sold

Cost of Commodities Sold (COGS) is a term

that refers to the costs associated with the

manufacture of goods According to the bar

chart, both NKG and HSG had a slight

decrease in COGS over time Between 2018

and 2020, NKG's COGS declined by

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approximately VND 3 trillion, from VND 14,019 trillion to VND 10,690 trillion As for NKG'scompetitor, HSG lowered COGS from 30,464 to 22,903 trillion dongs during the same period,which decreased to 7.5 trillion dongs The data shows that HSG has a more significant cost of goodssold than NKG, around 15 trillion dongs This demonstrates that NKG operates on a far smallerscale than HSG.

2.2.3 Total expenses (before income tax)

A glance at the chart reveals that the total cost of NKG has remained relatively stable over the lastthree years Between 2018 and 2019, the overall cost decreased by 14.854 trillion VND to 12,391trillion VND However, this figure increased marginally to 11,331 trillions in 2020 This stability ispartly due to a minor increase in COGS, which accounts for a significant portion of NKG's totalcosts However, NKG's ratio is comparatively low compared to HSG, indicating that the company iseffectively managing its operating expenses According to the obtained results, HSG likewiseexhibited a considerable drop in comparison to NKG Between 2018 and 2019, Hoa Sen Grouplowered its overall cost from 34,149 trillion to 27,889 trillion, or around 6 trillion dong, roughlythree times that of Nam Kim Group Moreover, by 2020, they intend to reduce that figure to 26,262trillion, a decrease of almost 1.6 trillion dongs As a result, to increase profitability, HSG shouldimprove its operating expense management by reducing this expense

Non-operating expenses are defined as those that are not directly tied to the business's core activity.This table shows that NKG generated a total non-operating income of 4,951, 195,336, and 3,629trillion in 2018, 2019, and 2020, respectively While 2020's revenue declines significantly, they donot allow their non-operating revenue to be negative, equating to a loss Meanwhile, HSG's non-operating revenue increased significantly in 2018 and 2019 to 56,900 and 253,166 trillion dong,respectively According to 2018 estimates, HSG is ten times more profitable than NKG, asignificant difference However, in 2019, NKG nearly caught up to its opponent, reducing thedistance from ten to 1.1 times Furthermore, as noted previously, NKG collected a total of 3,629trillion despite a significant decline in revenue Meanwhile, as a solid rival to NKG, HSG incurred aloss of approximately VND 3,285 trillion

2.2.4 Earnings per share

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