HAGL Group plans to divest from HAGL Myanmar, which is its largest real estate project, the firm said in its recent 2018 financial report.
HAGL now lists real estate as part of its "other activities," and it was not even mentioned in chairman Doan Nguyen Duc’s letter to its shareholders. In 2018, HAGL Group's revenues from real estate were only 1.1 percent at VND58 billion ($2.5 million).
Previously, in 2008-2012 period, when property was its main business, it earned VND3 trillion ($129 million) a year mostly from projects in Ho Chi Minh City. However, the firm began to diversify in the next years.
A property project developed by Hoang Anh Gia Lai Group in HCMC.
In 2013, revenues from real estate fell to below VND250 billion ($10.7 million) from VND2.8 trillion ($120.7 million) the year before.
One year later, HAGL said in a letter to shareholders: "HAGL has restructured the real estate business and has pulled out of Vietnam's property market. We believe that the country’s real estate supply is too large for its absorption ability now and in the near future."
It begun moving into agriculture and husbandry. HAGL last year invested VND976 billion ($42 million) to buy 5,300 hectares of land in Cambodia to grow bananas for export to China where demand is growing strongly.
HAGL has been depending on plants with low ripening times such as bananas, chili and passion fruit to speed up its cash flow cycle, said Mr Duc. The firm expects bananas to contribute 73.3 percent of its revenues this year of VND4.8 trillion ($205.9 million).
In 2018, HAGL Agrico, which is its agriculture arm, reported that revenues of VND3.69 trillion ($159 million) and losses of VND659 billion ($28 million) compared to a profit of VND527 billion ($22.7 million) of the previous year.
