plastics industry report q2/2018 - market research …...part ii. world market 8. current situation...

1

PLASTICS INDUSTRY REPORT Q2/2018

TABLE OF CONTENTS

2

Part Page Part Page

Abbreviation 4 4. Materials 26

Executive summary 5 5. Production 34

I. Business environment 6 6. Consumption 37

1. Macroeconomic situation 6 7. Import export 40

2. Legal framework 11 8. Current situation in some typical countries 44

3. Trade agreements 14 9. Plastic production in the region 49

II. World market 18 10. Big plastic enterprises in the industry 51

1. Definition and classification 19 III. Vietnam market 53

2. Production value chain 20 1. Industry development history 53

3. Machinery/Technology 22 2. Machinery/Technology 55

TABLE OF CONTENTS

3

Part Page Part Page

3. M&A activities in the industry 57 1. Outlook 84

4. Input materials 60 2. Forecast 87

5. Production 64 3. Industry development planning 91

6. Consumption 71 VI. Enterprise analysis 94

7. Import export 74 1. Enterprise introduction 94

8. Competitive analysis 77 2. Financial analysis 99

IV. Industry risks 81 VII. Appendix of financial statements 106

V. Outlook and forecast 84

TABLE OF ABBREVIATIONS

TABLE OF ABBREVIATIONS

4

Abbreviation Full name Abbreviation Full name

AEC ASEAN Economic Community GDVC General Department of Vietnam Customs

SE Selling expense GSO General Statistic Office of Vietnam

G&A expense General & Administrative expense Co. Ltd Limited Liability

EVFTA Vietnam-EU Free Trade Agreement NCA Non-current asset

FTA Free Trade Agreements PE Polyethylene

GDP Gross Domestic Products PP Polypropylene

BOD Board of Director PS Polystyrene

HIPS High Impact Polystyrene PVC Poly Vinyl Chloride

HPE High Density Polyethylene VPA Vietnam Plastic Association

LLDPE Low Density Polyethylene VTICVietnam Industry and Trade Information

Centre

SBV State Bank of Vietnam

EXECUTIVE SUMMARY

5

• The plastics industry is one of the industries growing stably in the world over

the past 50 years.

• Currently, packaging plastics is the biggest segment with 26% of the total

output.

Content is intentionally removed for demo purpose

• Vietnam’s plastics industry has a large number of enterprises

with nearly 4,000 ones and 200,000 of labor.

• Plastic production output in 2016 was estimated at nearly 6.63

million tonnes.

6

Executive summary

• Currently, Vietnam’s plastic industry has to import materials from the

outside, with an import volume of 80%.

• The industry revenue has risen rapidly in the period of 2013 – 2016, with

a CAGR of 21.1% and an estimated consumption of 15.61 billion USD in

2017.

• The industry is facing trade deficit as import turnover exceeding greatly

export volume.


TABLE OF CONTENTS

Part I. Business environment

1. Macroeconomic situation

2. Legal framework

3. Trade agreements

7



8

Source: VIRAC, GDVC

Source: VIRAC, GSO

USD/ person

USD billion

Plastic material imports and contribution to total turnover,

2010 – Q1/2018


GDP growth rate by quarter, 2015 - Q1/2018

9

Source: VIRAC, SBV



Source: VIRAC, SBV

VND/USD exchange rate, 2013 – 3/2018

VND/CNY exchange rate, 1/2016-3/2018


10

Source: VIRAC, EVN

Source: VIRAC, Indexmundi



USD/barrel

VND/kWH

USD/MMBTU

Average price of crude oil and natural gas in the world, 2014 – 3/2018

Average electricity price, 2007 – 2017


11

Source: VIRAC, GSO



%

Source: VIRAC, GSO

Monthly CPI fluctuation, 2014 – 3/2018

Average interest rate, 2012 – Q1/2018e


12

TABLE OF CONTENTS



2. Legal framework

3. Trade agreements

13


2. Legal framework


14


2. Legal framework


15


2. Legal framework


16

TABLE OF CONTENTS



2. Legal framework

3. Trade agreements

17

Impact of AEC to Vietnamese plastic businesses


3. Trade agreements


18


3. Trade agreements


The impact of CPTPP to Vietnam's plastics industry

Regional Comprehensive Economic Partnership (RCEP) and the plastics industry in Vietnam

19


3. Trade agreements


Vietnam Korea Free Trade Agreement (VKFTA) and Japan-Vietnam Economic Partnership Agreement (VJEPA)

Vietnam-EU Free Trade Agreement (EVFTA)

Part II. World market

1. Definition and classification

2. Production value chain

3. Machinery/Technology

4. Materials

5. Production

6. Consumption

7. Import export

8. Current situation in some typical countries

9. Plastic production in the region

10. Big plastic enterprises in the industry

20

TABLE OF CONTENTS

21

Definition

Classification




22





4. Materials

5. Production

6. Consumption

7. Import export




TABLE OF CONTENTS

23

Source: VIRAC




24





4. Materials

5. Production

6. Consumption

7. Import export




TABLE OF CONTENTS

25

Source: VIRAC, BPF

• There are many technologies used to produce plastics

Methods Main materials Main products




26




27



USD

billion

Source: VIRAC, TrademapSource: VIRAC, Plasticsínight

USD million Thousand tons

Source: VIRAC, Canadian PlasticsTop exporters of plastic and rubber processing machinery,

2016 - 2017Export of plastic and rubber processing machinery, 2013 - 2017e

Market share of plastic machinery by user, 2016


28





4. Materials

5. Production

6. Consumption

7. Import export




TABLE OF CONTENTS

29

Production process of recycled plastic granules


4. Materials – 4.1 Definition and classification


30

Production process of raw plastic granules


4. Materials – 4.1 Definition and classification


31

Source: VIRAC, Europe Plastic Source: VIRAC, Europe Plastic


4. Materials – 4.2 Raw plastic granules

Million tons

Global production of plastics and plastic granules, 2009 – 2016e Raw plastic resin production, 2016


32

Source: VIRAC, ICIS

Source: VIRAC, ICIS


4. Materials – 4.2 Raw plastic granules

Million tons

Global Polymer demand, 2010 - 2016e

Global Polymer demand by type, 2016


33

Source: VIRAC, Trade map


USD million


4. Materials – 4.2 Reprocessed plastic granules


USD millionUSD million

Top largest exporters of plastic scraps, 2017 Top largest importers of plastic scraps, 2017

Global import value of plastic scraps, 2012 - 2017e


34


4. Materials – 4.3 Plastic additives


35

Source: VIRAC, UN Comtrade

Source: VIRAC, UN ComtradeSource: VIRAC, Plastics Engineering


4. Materials – 4.3 Plastic additives

USD billion

USD millionGlobal consumption of additives by region, 2017

Top largest exporters of additives in the world,

2016 - 2017

Consumption value of global additives, 2013 – 2022f


36





4. Materials

5. Production

6. Consumption

7. Import export




TABLE OF CONTENTS

37

Source: VIRAC, Plastic Europe



5. Production

Million tons

Million tons

Plastic production in some countries, 2015

World plastic production, 2011 - 2016


38

Source: VIRAC, PAGEV


3. Production

Plastic production in some regions, 2015


39





4. Materials

5. Production

6. Consumption

7. Import export




TABLE OF CONTENTS

40

Source: VIRAC, PLASTICS


6. Consumption

Million tons

Source: VIRAC, PLASTICSSource: VIRAC, PLASTICS

Kg/person

Plastic consumption by region, 2015

World plastic consumption, 2011 - 2015e

Plastic consumption per capita by region/country, 2015


41

Source: VIRAC, Statista



6. Consumption

CAGR in plastic consumption in some regions,

2015 – 2019f

Global plastic consumption by application, 2016


42





4. Materials

5. Production

6. Consumption

7. Import export




TABLE OF CONTENTS

43



7. Import export

USD billion

Plastics import export, 2012 - 2017


44



7. Import export

USD billionImport export of some plastic products, 2017

Import export of some plastic products, 2016



45

Source: VIRAC

Product codeGoods description


7. Import export


46

Source: VIRAC, ITC


7. Import export

USD billion


Top largest plastic importers in the world, 2017 Top largest plastic exporters in the world, 2017USD billion

Source: VIRAC, ITC

47





4. Materials

5. Production

6. Consumption

7. Import export




TABLE OF CONTENTS

48

Source: VIRAC, Statista

Source: VIRAC, IBIS


8. Current situation in some typical countries – 8.1 China

Million tons

USD billion

Plastic production in China, 4/2015-12/2017

Sales in Chinese plastics industry, 2014 – 2019f


49

Source: VIRAC, Deutsche Bank Research

Source: VIRAC, PlasticEurope


8. Current situation in some typical countries – 8.2 Germany

Growth of plastic production, 2011 - 2016

Source: VIRAC, GTAI Research 2014

Structure of FDI into plastic industry by projects in some countries, 2014

Top 5 largest plastic consumer countries in Europe, 2015


50

Source: VIRAC, StatistaSource: VIRAC, ACC


8. Current situation in some typical countries – 8.3 USA

Million tonsPlastic production in The U.S, 2010 - 2015

Growth of plastic and rubber products in the US, 2016e –

2020f


51

Source: VIRAC, JPIF


8. Current situation in some typical countries – 8.4 Japan

Million tons

Plastic production in Japan, 2012 - 6/2017

Source: VIRAC, JPIF

Structure of plastic production by product, 6/2017


52





4. Materials

5. Production

6. Consumption

7. Import export




TABLE OF CONTENTS

53





Top most exported categories of Southeast Asia, 2016

Plastic import markets of Southeast Asia, 2016


54





4. Materials

5. Production

6. Consumption

7. Import export




TABLE OF CONTENTS

55



No. CompanyRevenue (USD

billion)Information

1

2

3

4

5

6

Source: VIRAC


TABLE OF CONTENTS

Part III. Vietnam market

1. Industry development history


3. M&A activities in the industry

4. Materials

5. Production

6. Consumption

7. Import export

8. Competitive analysis

56

57




58

TABLE OF CONTENTS





4. Materials

5. Production

6. Consumption

7. Import export


59

Source: VIRAC, Uncomtrade

Source: VIRAC, Uncomtrade, ITC



USD million

Import market structure of machinery in plastics industry, 2016e

Import turnover of plastic and rubber machinery,

2009 – 2016e


60

TABLE OF CONTENTS





4. Materials

5. Production

6. Consumption

7. Import export


61



SCG's ownership in Vietnam plastic enterprises, 2018

Source: VIRAC


62




63

TABLE OF CONTENTS





4. Materials

5. Production

6. Consumption

7. Import export


64

Source: VIRAC, BSR

Source: VIRAC, VPA


4. Materials – 4.1 Domestic material source

Production output of plastic materials and additives, 2010 –

Q1/2018Thousand tons

Thousand tons

Production output and consumption of Binh Son petrochemical

refinery, 2013 – 6M/2017

Production of plastic granules and additives in some provinces,

Q1/2018

Source: VIRAC, VITIC


65

Source: VIRAC ,Bloomberg


4. Materials – 4.1 Domestic material source

EUR/ton Polymer prices, 5/2015 – 4/2018Content is intentionally removed for demo purpose

66

Source: VIRAC, GDVC

Source: VIRAC, GDVC


4. Materials – 4.2 Imported source

Thousand

tons

USD

million

Import of raw plastic granules, 2010 – Q1/2018

Import market structure of raw plastic granules, Q1/2018


67

Source: VIRAC, GDVC

Source: VIRAC, GDVC

Import turnover of plastic scraps, 2012 – Q1/2018


4. Materials – 4.2 Imported source

USD

million

Source: VIRAC, GDVC

Import structure of plastic materials by type, Q1/2018

Top largest plastic importers, Q1/2018


68

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4. Materials

5. Production

6. Consumption

7. Import export


69

Source: VIRAC, GSO


5. Production

Number of plastic enterprises by region,

2010 - 2016

Number of enterprises and labor in the industry, 2010 - 2016

Source: VIRAC, GSO


70


5. Production

Million

tons

Source: VIRAC, GSO

Source: VIRAC, VPA

Plastic production, 2009 – 2018e

Plastic production structure, Q1/2018


71

Polymer

typeApplication


5. Production

Thousand

tons

Production of plastic packaging, 2009 – Q1/2018

Source: VIRAC

Application by type of polymer

Source: VIRAC, GSOContent is intentionally removed for demo purpose

72

Source: VIRAC, GSO


5. Production

Thousand

tons

Production output of household plastics, 2009 – Q1/2018e


73


5. Production

Thousand

tons

Source: VIRAC, GSO

Production output of construction plastics, 2009 – Q1/2018e


74


5. Production

Source: VIRAC tổng hợp

Ton

Design capacity of plastic pipes of some large enterprises in the industry, 2017


75

Source: VIRAC, GSO


5. Production

Thousand

tons

Production of technical plastics and other plastics,

2009 – Q1/2018e


Industrial production value of plastic

and rubber components, 2011 -

2016VND

billion

Source: VIRAC, SIDEC

Some large enterprises producing engineering plastics

Company Revenue 2016

(VND billion)

Main products Partner

Source: VIRAC, SIDEC

76

TABLE OF CONTENTS





4. Materials

5. Production

6. Consumption

7. Import export


77


6. Consumption

USD

billion

Plastic consumption, 2013 – Q1/2018e

Source: VIRAC, VPA

Source: VIRAC, VPA

Kg/person/year

Consumption of plastic per capita in Vietnam, 1989 - 2016


78


6. Consumption

Source: VIRAC, VPA

Source: VIRAC, VPA

Scale of plastic packaging business listed

Scale of plastic packaging market in Vietnam, 2012 – 2016f


79


6. Consumption

Source: VIRAC, VPA

Number of shops and dealers of plastic pipe manufacturers, 2017

Source: VIRAC, VPA

Plastic pipe consumption market share in Vietnam, 2016


80

TABLE OF CONTENTS





4. Materials

5. Production

6. Consumption

7. Import export


81

Source: VIRAC, GDVC


7. Import export – 7.1 Import

USD million

Import market structure of plastic products, 3M/2018

Imported plastic products, 2010 – Q1/2018

Source: VIRAC, GDVC

Source: VIRAC, GDVC

USD

million

Import of plastic products by month, 2017 - 2018


82

Source: VIRAC, GDVC


7. Import export – 7.2 Export

USD million

Export turnover of plastic products, 2010 – Q1/2018

Structure of exporting enterprises of plastic products, 2013 – Q1/2018

Source: VIRAC, GDVC

Plastic products export by month, 2017 – 2018

USD million

Source: VIRAC, GDVC


83

Source: VIRAC, GDVC

Source: VIRAC, GDVC



Structure of export plastic products, Q1/2018

Export market structure of plastic products, Q1/2018


84

Source: VIRAC, GDVC



Top exporters of plastics and plastic products Q1/2018

Top importers of plastics and plastic products, Q1/2018


85

TABLE OF CONTENTS





4. Materials

5. Production

6. Consumption

7. Import export


86




87




88




TABLE OF CONTENTS

Part IV. Industry risks

89

90

Acquisition risk


Environmental risks


91


Occupational health risks

Risk of raw materials

Market risk


92



TABLE OF CONTENTS

Part V. Outlook and forecast

1. Outlook

2. Forecast

3. Industry development planning

93

94


1. Outlook


95


1. Outlook


96

TABLE OF CONTENTS


1. Outlook

2. Forecast


97


2. Forecast – 2.1 Forecast for World market


98


2. Forecast – 2.1 Forecast for Vietnam market


99

Source: VIRAC, MOIT


2. Forecast – 2.1 Forecast for Vietnam market

Thousand tonsForecast of plastic production, 2011 – 2020f


100

TABLE OF CONTENTS


1. Outlook

2. Forecast


101

Project Location

Capacity

(tons/year)

Total

investment

(USD million)

List of projects on plastic materials

Source: VIRAC, MOIT

Project Location

2016 - 2020

Number

Investment capital

(USD million)

List of projetcs on mold and equipment manufacture

Source: VIRAC, MOIT




102




TABLE OF CONTENTS

Part VI. Enterprise analysis

1. Enterprise introduction

2. Financial analysis

103

104

Tien Phong Plastic Joint-Stock Company (NTP)

Part V. Enterprise analysis



105

Binh Minh Plastic Joint Stock Company (BMP)




106

An Phat Plastic and Green Environment Joint Stock Company(AAA)




107

Ngoc Nghia Industry-Service-Trading Joint Stock Company (NNG)




108

Dong Nai Plastic Joint Stock Company (DNP)




109

Dong A Plastic Group Joint Stock Company (DAG)




110

Rang Dong Plastic Joint Stock Company (RDP)




111

Saigon Plastic Packaging Joint Stock Company (SPP)




112

Tan Dai Hung Plastic Joint Stock Company (TPC)




113

TABLE OF CONTENTS



2. Financial analysis

114


2. Financial analysis – Profitability

VND billion

Source: VIRAC

Net revenue, 2016 - 2017


115




116



VND billion

Source: VIRAC

Gross profit, 2016 - 2017


117



Source: VIRAC

Gross profit margin, 2016 - 2017


118




119


2. Financial analysis – Solvency

Solvency, 2016 - 2017

Source: VIRAC


120


2. Financial analysis – Solvency

Days of sales outstanding, 2016 - 2017

Days' sales in inventory, 2016 - 2017

Source: VIRAC

Source: VIRAC


121


2. Financial analysis – The ability to pay

Self-financing rate, 2016 - 2017

Source: VIRAC


122


2. Financial analysis – Performance efficiency

Source: VIRAC

Selling expenses/Net revenue ratio, 2016 - 2017


Source: VIRAC

123



Administrative expenses/Net revenue ratio, 2016 – 2017


124



Source: VIRAC

Source: VIRAC

Total asset turnover, 2016 - 2017

Fixed asset turnover, 2016 - 2017Content is intentionally removed for demo purpose

125


2. Financial analysis – Rate of return

%Profit ratio, 2016 - 2017


126


2. Financial analysis – Rate of return


TABLE OF CONTENTS

Part VIII. Appendix of financial statements

127

128

VIII. Appendix

Financial statements - Tien Phong Plastic Joint-Stock Company (NTP)

BALANCE SHEET

Unit: VND million 2017 2016

A. CURRENT ASSETS

I. Cash and cash equivalents

II. Short-term financial investment

III. Short-term receivables

IV. Inventories

B. LONG-TERM ASSETS

I. Fixed assets

TOTAL ASSETS

A. LIABILITIES

I. Short-term liabilities

II. Long-term liabilities

B. OWNER'S EQUITIES

I. Owner's equities

TOTAL CAPITAL

INCOME STATEMENT


Net revenue from goods sold and services provided

Cost of goods sold and services provided

Gross profit from goods sold and services provided

Financing income

Financial expenses

Selling expenses

Administrative expenses

Net profit from business activities

Total accounting profit before tax

Profit after corporate income tax

CASH FLOW STATEMENT


I. Cash flow from business activities

Net cash flow from business activities

II. Cash flow from investing activities

Net cash flow from investing activities

III. Cash flow from financial activities

Net cash flow from financial activities

Net cash flow during the period

Cash and cash equivalents at the beginning of the

period

Cash and cash equivalents at the end of the period


129

VIII. Appendix

Financial statements – Binh Minh Plastic JSC

BALANCE SHEET


A. CURRENT ASSETS




IV. Inventories

B. LONG-TERM ASSETS

I. Fixed assets

II. Long-term financial investment

TOTAL ASSETS

A. LIABILITIES



B. OWNER'S EQUITIES

TOTAL CAPITAL

INCOME STATEMENT





Financing income

Financial expenses

Selling expenses





CASH FLOW STATEMENT










period



130

VIII. Appendix

Financial statements - An Phat Plastic and Green Environment Joint Stock Company(AAA)

BALANCE SHEET


A. CURRENT ASSETS




IV. Inventories

B. LONG-TERM ASSETS

I. Fixed assets

TOTAL ASSETS

A. LIABILITIES



B. OWNER'S EQUITIES

TOTAL CAPITAL

INCOME STATEMENT





Financing income

Financial expenses

Selling expenses





CASH FLOW STATEMENT










period



131

VIII. Appendix

Financial statements - Ngoc Nghia Industry-Service-Trading Joint Stock Company (NNG)

BALANCE SHEET


A. CURRENT ASSETS




IV. Inventories

B. LONG-TERM ASSETS

I. Fixed assets

TOTAL ASSETS

A. LIABILITIES



B. OWNER'S EQUITIES

TOTAL CAPITAL

INCOME STATEMENT





Financing income

Financial expenses

Selling expenses





CASH FLOW STATEMENT










period



132

VIII. Appendix

Financial statements - Dong Nai Plastic JSC

BALANCE SHEET


A. CURRENT ASSETS




IV. Inventories

B. LONG-TERM ASSETS

I. Fixed assets

II. Long-term financial investment

TOTAL ASSETS

A. LIABILITIES



B. OWNER'S EQUITIES

TOTAL CAPITAL

INCOME STATEMENT





Financing income

Financial expenses

Selling expenses





CASH FLOW STATEMENT










period



133

VIII. Appendix

Financial statements - Dong A Plastic Group Joint Stock Company (DAG)

BALANCE SHEET


A. CURRENT ASSETS




IV. Inventories

B. LONG-TERM ASSETS

I. Fixed assets

TOTAL ASSETS

A. LIABILITIES



B. OWNER'S EQUITIES

TOTAL CAPITAL

INCOME STATEMENT





Financing income

Financial expenses

Selling expenses





CASH FLOW STATEMENT










period



134

VIII. Appendix

Financial statements - Rang Dong Plastic JSC

BALANCE SHEET


A. CURRENT ASSETS




IV. Inventories

B. LONG-TERM ASSETS

I. Fixed assets

TOTAL ASSETS

A. LIABILITIES



B. OWNER'S EQUITIES

TOTAL CAPITAL

INCOME STATEMENT





Financing income

Financial expenses

Selling expenses





CASH FLOW STATEMENT










period



135

VIII. Appendix

Financial statements - Saigon Plastic Packaging Joint Stock Company (SPP)

BALANCE SHEET


A. CURRENT ASSETS




IV. Inventories

B. LONG-TERM ASSETS

I. Fixed assets

TOTAL ASSETS

A. LIABILITIES



B. OWNER'S EQUITIES

TOTAL CAPITAL

INCOME STATEMENT





Financing income

Financial expenses

Selling expenses





CASH FLOW STATEMENT










period



136

VIII. Appendix

Financial statements - Tan Dai Hung Plastic Joint Stock Company (TPC)

BALANCE SHEET


A. CURRENT ASSETS




IV. Inventories

B. LONG-TERM ASSETS

I. Fixed assets

TOTAL ASSETS

A. LIABILITIES



B. OWNER'S EQUITIES

TOTAL CAPITAL

INCOME STATEMENT





Financing income

Financial expenses

Selling expenses





CASH FLOW STATEMENT










period



Report Disclaimer

Report Disclaimer

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produced this report for private circulation to professional clients only. All information and statistical data herein have been obtained from sources we believe to be

reliable and made to ensure the accuracy of the contents of the pages of the report at the time of preparation. Such information has not been independently

verified and VIRAC makes no representation or warranty, whether express or implied, of any kind with respect to the document and its contents, information and

materials. The content found in this report is proprietary to VIRAC and is provided solely for your personal and non-commercial use. You agree that you will not use

this report for any purpose that is unlawful and that you will not reproduce the report or redistribute it outside your organization, or place it on a website for public

access without the express written permission of VIRAC.

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6th Floor, Anh Minh Building, 36 Hoang Cau, O Cho Dua, Dong Da, Hanoi, Vietnam

Website: http://viracresearch.com

Email: [email protected] | Tel: +84 463289520

137

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plastics industry report q2/2018 - market research …...part ii. world market 8. current situation...

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