Creating growth momentum for businesses
In the context of the Government setting a GDP growth target of 8% and committing to strongly disburse public investment capital, many businesses in this field are facing great opportunities to increase revenue and profit this year.
Ms. Duong Thi Thu Hue - Analysis Department, VNDIRECT Securities Joint Stock Company - said that in 2025, the Government proposed to increase the total public investment budget to VND 874,300 billion, an increase of 11% compared to the previous plan.
This means that a series of key transport projects such as the North-South Expressway Phase 2, Long Thanh Airport, and Ho Chi Minh City Ring Road 3 will enter an important construction phase, especially the asphalt section. The total length of expressway projects that need asphalt paving in 2025 is estimated at 754km, a sharp increase of 83.4% compared to the previous year. This is an important factor that helps the domestic demand for sugar resin explode, bringing positive prospects to businesses in the industry, VNDIRECT expert commented.
The increase in public investment disbursement not only increases the demand for sugar resin but also creates a strong spillover effect to many related industries such as cement, steel, sand and stone and chemical products for construction.
According to VNDIRECT, the demand for cement and construction steel may increase significantly when key infrastructure projects are accelerated.
In the cement sector, enterprises such as Vietnam Cement Corporation (Vicem), Ha Tien 1 Cement Joint Stock Company (HT1), Bim Son Cement Joint Stock Company (BCC) are expected to benefit from increased consumption demand.
Similarly, the steel industry also benefits, especially enterprises with a high proportion of construction steel consumption such as Hoa Phat Group (HPG), Viet Duc Steel Joint Stock Company (VGS) and Pomina Steel Joint Stock Company (POM). According to the Vietnam Steel Association (VSA), domestic steel consumption may grow by 8-10% in 2025, mainly thanks to demand from public investment projects.
Challenges and prospects for 2025
Commenting on the outlook for the steel industry in 2025, Mr. Dao Hong Duong - Director of Industry and Stock Analysis, VPBank Securities Joint Stock Company (VPBankS) - said that the steel market has many positive signals thanks to supporting factors from input costs, trade protection policies and increased domestic demand.
According to Mr. Duong, the first factor that helps improve the industry outlook is the sharp adjustment of input material prices such as iron ore and coal compared to 2023. Although the selling price of output products also tends to decrease, the decrease is not as deep as the price of raw materials, helping to improve the profit margin of steel manufacturing enterprises.
Mr. Duong emphasized that Vietnam's tax policies and trade protection measures for steel imported from India and China can create positive impacts for domestic steel enterprises.
Another important factor supporting the profits of enterprises in the construction and construction materials industry is the downward trend of world oil prices. This adjustment can help businesses such as Petrolimex Chemical Corporation (PLC), HT1, HPG reduce operating costs.
The explosion of public investment not only supports the construction materials industry but also creates momentum for the real estate market. Ms. Huynh Thi Kim Thanh - Manager of Savills Vietnam Investment Consulting Department commented that with the goal of expanding the expressway network to 3,000km by 2025 and 5,000km by 2030, regional connectivity will increase, positively affecting real estate along key routes.
A series of large projects such as Vinhomes Long Beach Can Gio, Xuan Que - Song Nhan or Cam Lien are taking advantage of infrastructure to attract investment. According to Ms. Thanh, the combination of modern infrastructure and large-scale real estate projects will help enhance Vietnam's position in the regional market, while promoting sustainable economic growth.
Despite many supporting factors, the construction, construction materials and real estate sectors still face some challenges. Public investment disbursement is often delayed due to administrative procedures, site clearance and actual disbursement progress. However, with the Government's strong commitment to infrastructure development, many experts believe that public investment will continue to be the main driving force for economic growth and corporate profits in 2025.
