Under these conditions, this corporation is under urgent pressure to balance its cash flows and execute rigorous financial management to mitigate systemic risk.

Negative operating cash flow

In Q2 2026, PET reported net revenue of VND 6,968 billion, up 48% year-on-year. Gross profit margins widened from 4.3% to 6.16%, boosting gross profit to VND 429 billion—a 2.2-fold increase compared to the same period last year. However, sharp increases across all overhead costs eroded these gains, leaving net profit at just over VND 101 billion. Cumulative figures for the first half of the year show net revenue reaching VND 13,097 billion and net profit reaching VND 202 billion, up 50% and 97% year-on-year, completing 57% and 64% of its full-year targets, respectively.

Despite profit growth, PET’s net operating cash flow swung sharply into the red, recording a deficit of over VND 1,050 billion, nearly quadruple the negative figure from the previous year. Crucially, despite this operational cash drain, PET aggressively expanded its proprietary stock trading portfolio.

As of 30 June 2026, PET’s trading securities portfolio stood at VND 472.41 billion, a 42% surge from the beginning of the year. Its largest holding is VIX stock, valued at VND 238.3 billion, against which the company has had to set aside VND 28.9 billion in impairment provisions. Beyond VIX, PET has deployed capital across various other listed equities.

This company holds an VND 82.98 billion stake in GEL stock (requiring VND 2.25 billion in provisions), alongside allocations in VPB and MSN, which require impairment provisions of VND 2.36 billion and VND 3.29 billion, respectively.

To fund its negative cash flows and equity bets, PET has resorted to heavy borrowing. Its debt load is currently spread across 13 domestic and foreign banks. According to its consolidated financial statements as of late June 2026, total liabilities hit VND 11,116 billion, driven predominantly by short-term financial debt of VND 6,805.2 billion. With equity capital standing at just over VND 2,828 billion, liabilities now outstrip equity by nearly four to one.

In the first six months of the year, financial expenses spiked by over 86% year-on-year to more than VND 237 billion. Debt servicing costs made up the lion’s share, with interest expenses exceeding VND 211 billion (accounting for over 89% of total financial costs), placing intense strain on liquidity.

What lies ahead for PET?

Compounding these heavy debt obligations is an ambitious corporate diversification plan, presenting PET with a high-stakes balancing act between funding capital demands and reining in debt servicing costs. With interest rates remaining elevated, high leverage combined with stock investment is exposing PET to considerable headwinds.

Following the full divestment of State capital, PET welcomed a new group of core investors and announced a strategic pivot toward infrastructure and real estate investments, straying from its core commerce and service operations. Its two key major shareholders are now HD Fund Management and VietinBank Capital.

At its 2026 Annual General Meeting of Shareholders, PET approved an ambitious capital expenditure package totalling VND 2,200 billion. This includes acquiring a 51% stake in Gelex Bac Sai Gon 1 Infrastructure LLC, a 1.41% stake in Gelex Bac Sai Gon 2 Infrastructure Investment LLC, and a 41% stake in Gelex Tay Thanh Pho Infrastructure LLC.

This marks a definitive shift away from traditional trading services toward infrastructure and property development. The three entity ventures, jointly formed by PET, GELEX Infrastructure (GEL), and Viconship Infrastructure and Industrial Real Estate, are designed to execute Build-Transfer (BT) wastewater treatment plant projects with a total combined capital requirement approaching VND 37,000 billion.

Beyond its new infrastructure ambitions, PET is also aiming to revive stalled property developments via a large-scale capital call. Specifically, this company plans to issue over 106.7 million shares to raise approximately VND 1,067 billion. The proceeds are earmarked for projects undertaken by PET and its subsidiaries, including the Cape Pearl Complex project in Ho Chi Minh City, as well as general financial restructuring.

Executing these infrastructure mega-projects will demand vast capital reserves. However, analysts warn that PET’s fund-raising efforts face tough conditions given elevated interest rates and volatile equity markets.

According to Vietcap, PET faces compounding downside risks, including fierce competition within its core distribution segment, a sluggish recovery in consumer demand, and potential mark-to-market losses stemming from its financial investments.