FOREIGN TRADE UNIVERSITY

FACULTY OF BANKING AND FINANCE

---------***--------

FINANCIAL STATEMENTS ANALYSIS OF SAIGON

ALCOHOL BEER
AND BEVERAGE JOINT STOCK CORPORATION
Student IDs: Nguyen Yen Linh – 2112380027
Le Phuong Thao - 2112380051
Pham Anh Minh – 2112380034

Class: TCH321E
Subject: Corporate Finance
Instructor: PhD. Nguyen Do Quyen

Hanoi, March 2023

WORK ASSIGNMENT
 Member name Work in charge
- Referencing.
- Analysed general information about Sabeco and
1. Nguyễn Yến Linh
the Vietnamese beer market, Liquidity ratios,
and Asset Turnover ratio.
- Document assembly, proof-reading.
2. Lê Phương Thảo - Analysed Financial Leverage ratios, Profitability
ratios, and Market Value ratios.
- Composed Preface and Conclusion.
3. Phạm Anh Minh
- Studied the DuPont Analysis Model.

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 TABLE OF CONTENTS
LIST OF FIGURES.................................................................................................................5
LIST OF TABLES...................................................................................................................5
PREFACE.................................................................................................................................6
I. GENERAL INFORMATION ABOUT SABECO.............................................................7
1. General information......................................................................................................7
2. History and Development.............................................................................................7
3. Vision, Missions and Core Values................................................................................7
3.1. Vision for 2025........................................................................................................7
3.2. Core Values..............................................................................................................7
3.3. Market share & Competitors....................................................................................8
II. SABECO'S FINANCIAL STATEMENTS ANALYSIS FROM 2019-2021..................9
1. Liquidity ratios..............................................................................................................9
1.1. Current ratios:..........................................................................................................9
1.2. Quick Ratio............................................................................................................10
1.3. Cash Ratio..............................................................................................................11
1.4. Net working capital to Total Assets (NWC to TA)...............................................12
1.5. Interval measure.....................................................................................................12
1.6. General comment...................................................................................................12
2. Asset management/turnover ratios............................................................................13
2.1. Inventory turnover & Days' Sale in Inventory.......................................................13
2.2. Receivables Turnover & Days' Sale in Receivables..............................................14
2.3. NWC, Fixed Assets & Total Assets Turnovers.....................................................14
2.4. General comment...................................................................................................15
3. Financial Leverage Ratios/ Long-term Solvency.....................................................15
3.1. Total debt ratio:......................................................................................................15
3.2. Debt-equity ratio:...................................................................................................16
3.3. Equity multiplier:...................................................................................................16
3.4. Long-term debt ratio:.............................................................................................17
3.5. Times interest earned ratio:....................................................................................17
3.6. Cash coverage ratio:...............................................................................................18
3.7. Comments on Sabeco’s leverage ratios from 2019 to 2021:.................................18
4. Profitability ratios.......................................................................................................18
4.1. Profit margin:.........................................................................................................19
4.2. Return on Assets (ROA)........................................................................................19
4.3. Returns on equity (ROE):......................................................................................19
4.4. Comments on Sabeco’s profitability ratio:............................................................19

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 5. Market value ratios.....................................................................................................19
5.1. Price-earning ratio (P/E ratio):...............................................................................20
5.2. Price-sales ratio (P/S ratio):...................................................................................20
5.3. Market to book ratio (P/B ratio):...........................................................................21
5.4. Comments on Sabeco’s market value ratios:.........................................................21
6. DuPont Analysis Model..............................................................................................21
REFERENCES.......................................................................................................................25
APPENDIX: FINANCIAL STATEMENTS OF SABECO, HABECO, AND THANH
HOA BEER.............................................................................................................................26

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 LIST OF FIGURES
Figure 1: Consumption of beer over 6 years (units: million litres) (Vietnamnet).....................7
Figure 2: Market share of brewer industry in Vietnam 2021 (Vietnamnet)..............................7
Figure 3: Current Ratio of Sabeco in 3 years.............................................................................8
Figure 4: The Current Ratio of Sabeco, Habeco and THB in 2021...........................................9
Figure 5: Quick Ratio of Sabeco in 3 years...............................................................................9
Figure 6: Quick ratio of Sabeco and its competitors in 2021.....................................................9
Figure 7: Cash Ratio of 3 companies.......................................................................................10
Figure 8: NWC to TA..............................................................................................................10
Figure 9: Interval Measure.......................................................................................................11
Figure 10: Inventory turnover & Days’ sale in Inventory of Sabeco and its competitors.......12
Figure 11: Receivables Turnover & Days' Sale in Receivables of Sabeco and its competitors
..................................................................................................................................................12
Figure 12: NWC, Fixed Assets & Total Assets Turnovers of Sabeco and its competitors......13
Figure 13: Total debt ratio of Sabeco and its competitors.......................................................14
Figure 14: Debt-equity ratio of Sabeco and its competitors....................................................14
Figure 15: Equity multiplier of Sabeco and its competitors....................................................15
Figure 16: Long-term debt ratio of Sabeco and its competitors...............................................15
Figure 17: Times interest earned ratio of Sabeco and its competitors.....................................16
Figure 18: Cash coverage ratio of Sabeco and its competitors................................................16
Figure 19: Profitability ratios of Sabeco and other competitors..............................................17
Figure 20: P/E ratio of Sabeco and its competitors..................................................................18
Figure 21: P/S ratio of Sabeco and its competitors..................................................................19
Figure 22: P/B ratio of Sabeco and its competitors..................................................................19
Figure 23: Sabeco's DuPont Analysis (2019-2021).................................................................20
Figure 24: Habeco's DuPont Analysis (2019-2021).................................................................20

LIST OF TABLES
Table 1: Liquidity ratios of Sabeco and its competitors............................................................8
Table 2: Asset turnover ratios of Sabeco and its competitors..................................................11
Table 3: Financial Leverage Ratios/ Long-term Solvency of Sabeco and other competitors..14
Table 4: Profitability ratios of Sabeco and other competitors..................................................17
Table 5: Market value ratios of Sabeco and other competitors................................................18
Table 6: Sabeco and Habeco's DuPont Analysis (2019 - 2021)...............................................21

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 PREFACE
The interval from 2021 to middle of 2022 was a blooming period for Vietnam’s
Stock Market, with an unprecedented number of new accounts being recorded and
people increasingly seeking opportunities to invest in stocks to gain profit from their
investing portfolios. There was a time when a quotation became a trending for newbie
investors that “whatever they invest, they win”. However, it is highly recommended
that investors take higher awareness when making investing decisions, as any
investment would still comply with the principle "high risk, high return" of the
market. In other words, this precaution is taken to minimize chances of unexpected
outcomes for their portfolios by applying their knowledge, skills, and experience with
careful consideration to maximize their return and minimize variance of their
portfolios.
When it comes to factors that constitute an investing decision and its success
prospective, from our team point of view, it is irrefutable to ignore the importance of
the analysis of a company’s financial health using specific indicators from financial
statements. To be more specific, the analysis of financial statements will be used as a
key tool to examine and forecast the company's development and decide whether to
invest in it or not. This includes all important liquidity ratios, financial leverage ratios,
asset management/ turnover ratios, profitability ratios and market value ratios to detect
whether they are sufficient or in risky zones to generate final decisions.
For potential portfolio investments, Sabeco is a name that comes up a lot.
Being well-recognized as the Vietnamese leading brewer, Sabeco have been familiar
with investors for decades for its capability and a great potential of growth.  However,
in the recent period, Sabeco has been facing a variety of challenges, from declining
sales and unfavorable exchange rates to intense competition from craft brewers. In
addition, from the beginning of 2020, the double impact of Covid-19 pandemic and
Decree 100/2019/ND-CP on restricting beer - alcohol when participating in traffic has
severely affected the beverage industry, resulting in the loss of production capacity of
the beverage business group, and Sabeco is not exceptionally out of the affected zone.
So should investors still consider investing in Sabeco? The current situation of
the brewing market has stimulated our team’s interest in answering this question, thus
promoting our desire to take an in-depth look at Sabeco’s current financial health and
market position to fulfill all curiosities that are raised during this project. Realizing
Sabeco as a potential target in profitable investment, we chose to research the topic:
"SABECO’S FINANCIAL STATEMENTS ANALYSIS IN THE PERIOD OF 2019-
2021". By analyzing specific data in SABECO's financial statements, and making
sufficient comparisons with corresponding up-to-date data from SABECO's main
competitors, this report will draw conclusions for the engraved question: Is it worth
the investment in SABECO to maximize profit. Our report will consist of three main
parts:
• PART 1: GENERAL INFORMATION ABOUT SABECO
• PART 2: SABECO'S FINANCIAL STATEMENTS ANALYSIS (2019-2021)
• PART 3: STOCK INVESTMENT DECISION: BUY OR SELL

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 I. GENERAL INFORMATION ABOUT SABECO
1. General information
SABECO (Saigon Alcohol Beer and Beverage Joint Stock Corporation) is one of
Vietnam’s leading beer producers. It was under the authority of Vietnam's Ministry of
Trade and Industry but is now a subsidiary of ThaiBev. Its main brands are Bia Saigon
(Saigon Beer) and 333 Beer. 
2. History and Development 
 In 1875, a little brewery was founded by Victor Largue – a Frenchman in Saigon
in 1875. 
 In 1910, this brewery developed into a completed factory of producing beers, soft
drinks and ice. 
 In September 1927, the factory was officially merged into the BGI brand, French.
 On May 17,1977, the Minister of Food and Victuals declared the decision
No.845 / LTTP which handled the whole factory of BGI for Southern Alcohol
Company to manage. On June 1, 1977, the factory was renamed as Saigon Beer
Factory.
 In 1993, Saigon Beer Factory changed the name into Sai Gon Beer Company after
it integrated Sai Gon Ice Factory, Beer Alcohol Plant and Dakai Mineral Water
Factory together.
 In 2003, Saigon Alcohol, Beer and Beverages Corporation (SABECO) was
established. SABECO was established on the basis of new members’ integration
like Binh Tay Liquor Company, Chuong Duong Beverages Company, Phu Tho
Glass Factory and Saigon Beer Company. 
 In 2008, SABECO received the title of Labor Hero in the Innovation period and
officially opened Saigon – Cu Chi brewery. This was considered as the most
modern brewery in Southeast Asia at that time. 
 In 2010, SABECO reached the output of 1 billion liters of beer.
 In 2016, the corporation officially issued stock at Ho Chi Minh Stock Exchange,
with the stock code: SAB. 
 Until now, Saigon Beer Company has been formed and developed for 148 years.
3. Vision, Missions and Core Values 
3.1. Vision for 2025
Develop SABECO to become the leading beverage group in Vietnam, having a
firm foothold in regional and international markets.
3.2. Core Values
1. Traditional brand: The superiority of a traditional brand is built and confirmed
over time. Customers have many choices and are well taken care of. SABECO has
become a “top of mind” in the hearts of customers.
2. Social Responsibility: The development of social responsibility is the tradition
of SABECO. We provide the society safe and useful products, and we always wish to
share and take responsibility for social work and environmental protection with
practical action.
3. Cooperation for Mutual Benefits: We build "mutually beneficial" partnerships
as the basis for sustainable development. We develop appropriate policies for long
cooperation to partner.
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 4. Sticking: Sticking to a friendly, sharing environment. Where people are
empowered to learn, create and contribute to the joy of success.
5. Continuous improvement: We are not satisfied with the present and are always
dreaming of rising, learning, creating, and innovating to meet constantly changing
needs. Continuous learning, creativity and innovation is our style.
3.3. Market share & Competitors
Vietnam consumes over 3.8 million kiloliters of beer per year, accounting for
2.20% of the total global market share.
A new report published by the Visual Capitalist reaffirms Vietnamese people’s
great love for beer. Vietnam ranks ninth in countries with the highest beer
consumption. Visual Capital noted that the Southeast Asian nation — the only one in
the region — consumes over 3.8 million kiloliters of beer per year, accounting for
2.20% of the total global market share.

Figure 1: Consumption of beer over 6 years (units: million litres) (Vietnamnet)

The Vietnamese beer market many years ago has been dominated by a group of
4 major brands, including Sabeco, Heineken, Carlsberg and Habeco. Each of them has
also been active in different regions.
In particular, Sabeco has a flagship market in the south, Habeco is concentrated
in the north market and Carlsberg dominates in the central market due to the
company's brewery located in Thua Thien-Hue. Meanwhile, Heineken, initially
dominant in the southern market with a high end and near-end segment, but has now
expanded its distribution network to all provinces, concentrated in major cities.
It is estimated that these four producers account for 94.4% of domestic beer
consumption.

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 Figure 2: Market share of brewer industry in Vietnam 2021 (Vietnamnet)
In our group's report, we will deeply look into Sabeco, and give out indicators
from Habeco and Bia Thanh Hoa (THB) to have a clear insight of Sabeco and its
position in the industry.
II. SABECO'S FINANCIAL STATEMENTS ANALYSIS FROM 2019-2021
1. Liquidity ratios

LIQUIDITY RATIOS

HAB THB
2019 2020 2021
2021 2021

Current Ratio 3.15x 3.77x 3.15x 2.06x 2.44x

Quick Ratio 2.82x 3.49x 2.92x 1.80x 1.97x

Cash Ratio 0.68x 0.53x 0.50x 0.34x 1.08x

Net working capital to total

48.50% 52.38% 51.23% 31.56% 42.19%
assets

215 308 365

Interval measure 237 days 223 days
days days days

Table 1: Liquidity ratios of Sabeco and its competitors

1.1. Current ratios:
In general, this index of Sabeco is always high, so the current debt payment
capacity of Sabeco is high and secured for creditors. In 2021, Sabeco reported a
current ratio of 3.15x - in other words - for every 1.000 VND of current debt, the
company has 3.150 VND to pay for debt. Yet, a high ratio may also signal that the
firm is not utilizing its current assets efficiently, arranging financing well, or
managing its working capital properly.

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 Figure 3: Current Ratio of Sabeco in 3 years
The figure for Sabeco fluctuated in the period given, starting at 3.15x in 2019,
raised to 3.77x in 2020, and dropped to 3.15x again at the end of 2021. The reason
behind this case could be explained by severe situations of COVID-19 all over the
world, which had caused business activities to be frozen for months. 
Looking closer into the components of this ratio, Sabeco has succeeded in
lowering current liabilities in the period 2019-2020, which results in the rise of the
current ratio. When it comes to 2021, both current assets and current liabilities in this
financial year increased significantly compared to the previous 2 years. However,
Sabeco still outperformed its competitors in this type of ratio, with 2.06x and 2.44x
for Habeco and THB respectively. 

Figure 4: The Current Ratio of Sabeco, Habeco and THB in 2021

1.2. Quick Ratio

Figure 5: Quick Ratio of Sabeco in 3 years

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 The figure for Sabeco witnessed an increase over a 3-year period, yet fluctuated
under 3 in 2019 and 2021. In 2020, the firm recorded a quick ratio of >3.0x, which is
much higher than that of 2019, and this trend could be explained by COVID-19
appearing in the first quarter of 2020. The firm definitely met difficulties managing
the liquidity during 2020 and 2021, though, SABECO did have an impressive
performance, and could be regarded as having a healthy quick ratio. 

Figure 6: Quick ratio of Sabeco and its competitors in 2021

In a different scenario, Sabeco continued leading the way with the quick ratio
compared to Habeco and THB with the indication of 1.80x and 1.97x respectively.
The ratio for Habeco and THB are totally normal and these two can easily meet its
short-term obligation without having to sell inventories.
1.3. Cash Ratio

Figure 7: Cash Ratio of 3 companies

All of Sabeco's cash ratios from 2019 to 2021 are less than 1.0x, indicating that
Sabeco has more current liabilities than cash and cash equivalents. Habeco and THB
also have cash ratios that are less than 1.0x, which means they do not prefer keeping
cash available at a relatively high proportion to use the money for other purposes in
order to generate profits. 
Because the characteristics of the beer industry require large investments in
fixed assets, cash and cash equivalents are the lowest resources that can only pay for
basic necessities and are insufficient to cover short-term loans. In general, this index
has achieved the average level of the beer business, which is still positive to the firm's
development.

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 1.4. Net working capital to Total Assets (NWC to TA)

Figure 8: NWC to TA
The figure for Sabeco is relatively high, which fluctuated around 50% in the
period, starting at 48.50% in 2019, then growing slightly to 52.38%, and reached the
point of 51.23% at the end of 2021. Although there was a small drop in the figure in
the 2020-2021 period, Sabeco still outperformed its competitors’ ratio, with 31.56%
for Habeco and 42.19% for THB. This demonstrates Sabeco's greater liquidity and
financial strength than Habeco and THB, which is a good sign for investors to
consider buying Sabeco’s stocks.
1.5. Interval measure

Figure 9: Interval Measure

The ratio of Sabeco rose gradually throughout the period, and in 2021 it
reached 365, which means that by making use of only current assets, Sabeco can
function in a year and still have no financial difficulties. Compared to that of Habeco
and THB (over 200 days), Sabeco had proven its stable financial health and good
business situation even in the pandemic period.
1.6. General comment
We can see from the ratios that the indicators of Sabeco seemed to go down in
2021, though, explained the position of Sabeco as the leader brewer of Vietnam.
Moreover, the firm reached the peak of profits and operated at its max efficiency in
2022, though we decided not to include it in this report since the consolidated reports
for the year 2022 have not been published. There are still rooms for Sabeco to develop
and expand, and the potential is still there in 2023.

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 2. Asset management/turnover ratios

ASSET TURNOVER RATIOS

SAB SAB SAB HAB THB

2019 2020 2021 2021 2021

Inventory Turnover 14.41x 13.45x 11.25x 9.51x 6.71x

Days’ Sale in Inventory 25 days 27 days 32 days 38 days 54 days

Receivables Turnover 66.65x 47.32x 56.36x 18.38x 4.61x

Days' Sale in Receivables 5 days 8 days 6 days 20 days 5 days

Net Working Capital Turnover 2.9x 1.95x 1.69x 3.11x 2.86x

Fixed Assets Turnover 8.09x 5.74x 5.99x 3.18x 8.50x

Total Assets Turnover 1.41x 1.02x 0.87x 0.98x 1.21x

Table 2: Asset turnover ratios of Sabeco and its competitors

2.1. Inventory turnover & Days' Sale in Inventory

Figure 10: Inventory turnover & Days’ sale in Inventory of Sabeco and its
competitors
In the table, we can see Sabeco‘s inventory turnover ratio gradually decreased
from 2019 to 2021(14.41x to 11.25x). Reduced turnover suggests lower sales and
maybe overstock inventory. In other words, Sabeco's inventory control may be
lacking. However, the inventory turnover of Sabeco, though decreased slightly
overtime, is the highest ratio compared to SABECO and THB in the same year 2021.
THB reported the lowest ratio of 6.71x, which is quite low and could show that THB
inventory is not managed properly.
Likewise, the figure for Days’ Sale in Inventory of Sabeco is lowest among
the three. In 2021, this ratio was 32 days, whereas the inventories of Habeco and THB
lasted for 38 days and 54 days respectively. As a result, we can see that consumers
prefer Habeco and Sabeco products to THB beer, therefore, THB needs the longest
period of time to sell all its inventory.

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 2.2. Receivables Turnover & Days' Sale in Receivables

Figure 11: Receivables Turnover & Days' Sale in Receivables of Sabeco and its
competitors
The figure for Sabeco's Receivables Turnover witnessed a dip over the period
2019-2021, reaching 56.36x in 2021. This ratio is roughly three times that of Habeco
(18.38x) and ten times that of THB (4.61x). The ratio demonstrates Sabeco's capacity
to recover customer debt, which is fairly good compared to its rivals.
Sabeco's Days' Sales in Receivables have been very steady over the last three
years. In 2021, the ratio is 6 days, which is greater than THB (5 days), but
significantly lower than Habeco (20 days). As a result, Sabeco's receivables are in
good shape and will not be written off as bad debts. A highest Habeco ratio among the
three may suggest a corporation with ineffective collection methods and clients who
are unable or unwilling to pay for their goods.
2.3. NWC, Fixed Assets & Total Assets Turnovers

Figure 12: NWC, Fixed Assets & Total Assets Turnovers of Sabeco and its
competitors
An NWC turnover ratio of 1.69x from Sabeco indicates that the company
generates $1.69 of sales per dollar of working capital employed. This ratio of Sabeco
in 2021 has decreased to nearly half by 2019, and is much lower than that of the other
two rivals (3.11x for Habeco and 2.86x for THB). This is a sign warning that the
working capital of Sabeco is not as efficient as its rivals, and has dropped over 3
years. The firm should figure out a way to maximize use of its working capital to
improve this index in the future.
The Fixed Assets Turnover ratio of Sabeco decreased significantly over the
period, a larger percentage indicates greater efficiency in managing fixed-asset

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investments The index in 2021 was 5.99x, compared to 8.09x of 2019. Although the
index is still higher than that of Habeco, THB outperformed Sabeco and Habeco in
this type of ratio, with a record of 8.5x. 
The Total Assets Turnover ratio continued the chain of dropping quickly of
Sabeco in Asset Turnover ratios, starting from 1.41x in 2019 to 0.87x in 2021. This
ratio is the lowest among the three companies, which means the ability of generating
revenue from assets of Sabeco is relatively low. THB came first in this index, with a
figure of 1.21x, followed by Habeco with 0.97x.
2.4. General comment
In contrast with liquidity ratios, Sabeco performed quite badly in terms of asset
turnover ratios in comparison with Habeco and THB. This means that the assets of
Sabeco are not generating enough sales, and there might be some problems with
managing assets. Therefore, investors should consider other factors to make the
investing decisions.
3. Financial Leverage Ratios/ Long-term Solvency

FINANCIAL LEVERAGE RATIOS

SAB SAB SAB BHN THB

2019 2020 2021 2021 2021

Total debt ratio 0.25x 0.22x 0.26x 0.31x 0.51x

Debt - Equity ratio 0.34x 0.29x 0.34x 0.46x 1.06x

Equity multiplier 1.35 1.29 1.34 1.46 2.06

Long-term debt ratio 0.03x 0.04x 0.02x 0.31x 0.08x

Times interest earned ratio 179.93x 95.97x 100.64x 37.66x 836.21x

Cash coverage ratio 197.25x 105.29x 112.08x 79.65x 2860.2x

Table 3: Financial Leverage Ratios/ Long-term Solvency of Sabeco and other

competitors

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 3.1. Total debt ratio:

Figure 13: Total debt ratio of Sabeco and its competitors

Sabeco’s total debt ratio remained relatively stable throughout the surveyed
period with little fluctuation (Only by 0.03 - 0.04). Compared to its rival companies in
the market, Hanoi Beer, and Thanh Hoa Beer, the aforementioned figures were
relatively low. Therefore, investing in this company can be considered a safe choice as
it has the ability to repay its liabilities.
3.2. Debt-equity ratio:

Figure 14: Debt-equity ratio of Sabeco and its competitors

Regarding the debt-equity ratio, Sabeco’s figures experienced the same trend as
its total debt ratio, which is stability. In 2019, the debt-to-equity ratio of Sabeco was
0.34. This number went down to 0.29 a year later and bounced back to the same point
as 2019 in 2021. This ratio is lower than that of the two rival companies within the
beer-producing industry, thus, implementing that Sabeco’s operation was rather
funded by mostly equity, not debt.
3.3. Equity multiplier:

Figure 15: Equity multiplier of Sabeco and its competitors

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 Sabeco’s equity multiplier remained mostly the same from 2019 to 2021 (1.35
in 2019 and 1.34 in 2021). This figure is not as considerable as that of the other
companies in the sector. Habeco and Thanh Hoa Beer have higher equity multipliers,
making Sabeco a more secure option for interested investors, since a low equity
multiplier suggests that a company is not reliant on debt.
3.4. Long-term debt ratio:

Figure 16: Long-term debt ratio of Sabeco and its competitors

The long-term debt ratios of Sabeco from 2019 to 2021 in general did not
surpass 0.1x and experienced a slight decline throughout the period (0.03, 0.04, and
0.02). On the flip side, the ratios for Habeco and Thanh Hoa Beer in 2021 were,
respectively, 15.5 times (0.31) and 4 times (0.08) higher than that of Sabeco. This lays
further emphasis on the fact that it is safer to purchase Sabeco’s stocks – a company
capable of repaying its long-term debts.
3.5. Times interest earned ratio:

Figure 17: Times interest earned ratio of Sabeco and its competitors
The figures for Sabeco, although witnessed a dip from 179.93 in 2019 to 100.64
in 2021, were still substantially greater than that of Habeco but lower than that of
Thanh Hoa Beer. Generally, creditors would be more in favor of a higher rate, meaning
that the lender’s EBIT is much higher than its interest expense and that the firm can
better meet its interest expense when they are due. The data suggest that Sabeco is
financially stable and has the ability to pay off its debts, making investing less risky for
Sabeco’s stockholders.

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 3.6. Cash coverage ratio:

Figure 18: Cash coverage ratio of Sabeco and its competitors

In 2019, it has a considerably high cash coverage ratio (197.25) but 2 years
later dropped to roughly 112.1. Despite the decline, Sabeco’s cash coverage ratio in
2021, when put in comparison with the two other companies, still showed signs of
strong cash flows to cover its debt, despite being not as high as the figure for Thanh
Hoa Beer..
3.7. Comments on Sabeco’s leverage ratios from 2019 to 2021:
It can be clearly seen that from the figures shown above, we can make some
conclusions about Sabeco’s long-term solvency. Firstly, the business depended mostly
on equity to finance its operation rather than debt. Moreover, it exhibited signs of the
ability to repay debts when they come due and strong cash flows.
Compared with Habeco, Sabeco outperformed in all ratios - Sabeco is less
reliant on debt and has a better ability to fulfill their liabilities. With Thanh Hoa Beer,
even though its times interest earned ratio and cash coverage ratio is remarkably high,
debt is the main source of income of this firm (unlike Sabeco whose operation is
mostly fueled by equities, therefore bankruptcy is less probable). Hence, Sabeco is a
decent choice for investors who want to engage in the beer-producing industry.
4. Profitability ratios

PROFITABILITY RATIOS

SAB 2019 SAB 2020 SAB 2021 BHN 2021 THB 2021

Profit margin 14.16% 17.65% 14.89% 5.30% 0.43%

ROA 19.91% 18.03% 12.89% 5.21% 1.82%

ROE 26.74% 23.27% 17.39% 7.63% 3.75%

Table 4: Profitability ratios of Sabeco and other competitors

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 Figure 19: Profitability ratios of Sabeco and other competitors
4.1. Profit margin:
Sabeco’s profit margin for the 3 years did not change much. The percentages
increased mildly from 14.16% in 2019 to 17.65% in 2020, then fell back to 14.89% a
year after. In 2021, Habeco and Thanh Hoa Beer did not do as well as Sabeco in terms
of generating income from revenue, which can be seen from their modest percentages
(5.30% and 0.43% in the corresponding order), indicating it is safe to conclude that
Sabeco is the most profitable business out of the three.
4.2. Return on Assets (ROA)
As seen from the calculations above, throughout the 3-year period that we are
looking into, Sabeco’s ROA suffered a decrease by 6.93% (From 19.91% to 12.89%).
This is a sign that Sabeco’s Board of Directors should investigate the company’s
activity with caution so as to bring its incomes up again. Nevertheless, Sabeco still
had a better ability to generate income from assets as its ROA in 2021 was noticeably
greater than the ROA of Habeco (5.21%) and Thanh Hoa Beer (1.82%).
4.3. Returns on equity (ROE):
Regarding Sabeco’s ROE, the figures saw a downward trend due to the impacts
of Covid-19 on production and sales. In 2021, the ROE of Sabeco was 17.39%, which
was almost 2.3 times higher than the percentage of Habeco (7.63%) and around 4.6
times the percentage of Thanh Hoa Beer. From the analysis above, it can be inferred
that Sabeco had one of the most decent management plans for its equities and can turn
the equities into incomes for the business.
4.4. Comments on Sabeco’s profitability ratio:
From 2019 to 2021, while the profit margin of the business enjoyed a slight
increase, its ROA and ROE seemed to have experienced declines due to the pandemic
started at the end of 2019. Additionally, in 2021, Sabeco outperformed its rivals -
Habeco and Thanh Hoa Beer - in terms of profitability ratios. From this, we can imply
that Sabeco is a competent and sustainable business in the beer and alcohol industry
when it comes to utilizing its shareholder equities and assets.
5. Market value ratios

MARKET VALUE RATIOS

SAB 2019 SAB 2020 SAB 2021 BHN 2021 THB 2021

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 Price-earning ratio 28.93x 26.47x 26.33x 46.06x 31.19x

Price-sales ratio 3.86x 4.47x 3.67x 2.02x 0.13x

Market-to-book ratio 7.28x 5.89x 4.29x 2.9x 1.17x

Table 5: Market value ratios of Sabeco and other competitors

5.1. Price-earning ratio (P/E ratio):

Figure 20: P/E ratio of Sabeco and its competitors

Considering the P/E ratios of Sabeco in 2019, 2020, and 2021, which fell in the
region from 26.3 and 28.9, experience a slight fall throughout the period. For Habeco,
its P/E ratio in 2021 was 46.06, and for Thanh Hoa Beer, it was 31.09. Although all
three of the examined companies’ stocks were overvalued, Sabeco had the lowest P/E
ratio of all, meaning that the difference between stock price and earnings from stock
of Sabeco is not as substantial as that of its two rivals. As a result, when the market re-
estimates its stock prices, Sabeco will face the least risk. However, Since the P/E ratio
conveys an array of implications, investors should make decisions carefully by taking
a look at the other market value ratios as well.
5.2. Price-sales ratio (P/S ratio):

Figure 21: P/S ratio of Sabeco and its competitors

Usually, the P/S ratio is used to estimate the stock value of companies with
negative earnings for extended periods, for example, start-ups. Therefore, for
companies like Sabeco, Habeco, and Thanh Hoa Beer, whose revenues are positive,
the P/S ratio is not as relevant as the P/E ratio but is still a factor to look into.

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 Generally, the P/S ratio of Sabeco for the surveyed period was around 4,
slightly greater than Habeco’s and remarkably higher than Thanh Hoa Beer’s - the
only company whose P/S ratio suggested that it was undervalued. Sabeco’s P/S may
make investors wary as the number is noticeably higher compared with other rivals in
the industry. However, the P/S ratio, in this case, is not as accurate as the P/E ratio and
did not make Sabeco’s stock a bad choice for stock buyers.
5.3. Market to book ratio (P/B ratio):

Figure 22: P/B ratio of Sabeco and its competitors

For Sabeco, its figures suffered from a gradual decrease over the 3-year period
because of Covid-19. In 2021, its P/B ratio was only 4.29, only about one-sixth of its
value in 2019.
Nonetheless, looking at the calculations above, although the P/B ratio for the
three discussed companies is higher than 1, meaning all of them are overvalued,
Sabeco’s potential development is highly estimated by stockholders since it has the
most outstanding ratio.
5.4. Comments on Sabeco’s market value ratios:
From the analysis made above, we can conclude that Sabeco’s stock, like its
rivals in the beer and alcohol segment, is overvalued by the market. Therefore, it is
agreeable that this business is believed to have the probability to expand even more
and yield profit in the future, making it a decent choice for investors interested in the
industry. Compared with Habeco and Thanh Hoa Beer, stockholders project Sabeco to
enjoy more growth and more income, and are willing to buy its stock at a higher price
than its book value.
6. DuPont Analysis Model
DuPont Analysis is a financial tool that is used to help assess a company’s
overall performance and its health by analyzing that company’s return on equity
(ROE). It is acknowledged that ROE has been widely recognized as a powerful
financial tool in assess the company’s performance, and that framework analysis has
been commonly used to analyze factors that drive the ROE. To be more specific the
Dupont analysis is an expanded return on equity formula, calculated by multiplying
the net profit margin by the asset turnover by the financial leverage. It is determined
by the following principle formula:
ROE = Net profit margin x Total asset turnover x Equity multiplier
Net income Sales Assets
= x x
Sales Assets Equity

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 By dividing the ROE into 3 drivers, we can have a better understanding about
the ROE of SABECO and also understand whether it is good or bad. In the case of
SABECO, our team has collected datas and examined them with sufficient
consideration. In addition, we also collected relavent financial ratios from Sabeco’s
competitors in the market to analyze and make comparisons to provide a more
comprehensive view of its current financial situation.

Figure 23: Sabeco's DuPont Analysis (2019-2021)

Figure 24: Habeco's DuPont Analysis (2019-2021)

SABECO HABECO

Year 2019 2020 2021 2019 2020 2021

Net income 5,370 4,937 3,929 523 661 324

Sales 37,899 27,961 26,374 9,335 7,453 6,951

Profit Margin 14.17% 17.66% 14.90% 5.60% 8.87% 4.66%

Sales 37,899 27,961 26,374 9,335 7,453 6,951

Total Assets 26,962 27,375 30,487 7,772 7,684 7,088

Asset turnover 1.406 1.021 0.865 1.201 0.970 0.981

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Total Assets 26,962 27,375 30,487 7,772 7,684 7,088

Total Equity 20,076 21,215 22,595 5,182 5,736 4,835

Equity multiplier 1.343 1.290 1.349 1.500 1.340 1.466

ROE 26.75% 23.27% 17.39% 10.09% 11.52% 6.70%

Table 6: Sabeco and Habeco's DuPont Analysis (2019 - 2021)

In the case of SABECO, overall, it is highly recognized that this company is
having the ROE ratio in sufficient range although their ROE plummeted significantly
since. SABECO’s ROE reached its peak in 2019 at 26.75%, with the corresponding
figure for 2 following years witnessed a considerable downward trend to fall to just
17.39% in 2021. To be more specific, when analyzing and indicating reasons for the
fall of ROE, its decrease is mainly attributed to the decrease in Asset Turnover Rate,
as the company’s revenue decreased gradually. On the other hand, Net Profit Margin
remained stable, meaning the company has a quite sufficient cost management system
to balance the ratio of Sales and Net Income. Also, SABECO had a quite stable equity
multiplier rate, indicating the company's business strategy to not expand during this
period, if not slightly decrease in financial leverage, proved by their efforts to reduce
the rate of the financial leverage in 2020 to 1.29. Total asset turnover is an issue that
worth noticeable to investors, but in overall this should not be exaggerated when their
Total Assets continued to increase yearly.
To have a better evaluation on the performance of SABECO, let’s have a look
at the breakdown of ROE of its rivals in this industry, which is HABECO. It is clearly
that HABECO experienced a more struggling and challenging period than that of
SABECO, with almost every compared financial ratios plummeted significantly in
2019-2021. With regards to HABECO’s ROE ratio, their ROE is a huge concern with
this figure being stably alarmed at the region of 10-12% (2019-2020) before
plummeted significantly to 6.7% (2021). This figure’s ratio is relatively lower than the
minimum rate of 15% for a business, according to William O'Neil's CANSLIM
criteria. HABECO's ROE in the last 3 years was always less than 15%, showing that
HABECO's current business situation was not very good and the company had not
really used capital effectively. There were also signs that HABECO was shrinking or
scaling down in both Total Assets and Total Equity, with both of these figures
experienced a downward trend. It is also noticeable that their Total Assets decreased
in bigger proportions than their Total Equity, and their Profit Margin was relatively
low during the examined period.

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 CONCLUSION: STOCK INVESTMENT DECISION: BUY OR SELL
From an investor’s perspective, it is commonly regarded that “When it comes
to Sabeco, the question to be raised isn’t whether to invest or not, but rather when”.
Genuinely, Sabeco is a strong, bluechip VN30, and stable company with a proven
track record of success that has not only developed a diversified portfolio of
subsidiary company and branches but also maintain a solid position in key markets
and is well-positioned for future growth in emerging markets, with a good capital
structure placed in the safe region and high liquidity.
However, there are some obstacles that will require Sabeco to overcome in the
coming years. Firstly, the global economy is slowing down, which could lead to
slower growth for Sabeco if they decide to expand their business operations. In
addition, the appearance of newcomers entering Vietnam's beer industry along with
existing competitors seeking to expand market shares makes the market more
competitive. Furthermore, regulatory changes with the issuance of Decree 100 to
impose higher punishments for drunkenness participating in the traffic and the
ongoing unstable macroeconomics creates uncertainty and volatility in the market are
some threats that can hold Sabeco back. If the company can overcome all these
obstacles, Sabeco will be not only a leader in Vietnam but also a challenger in the
foreign market. Despite these risks, we think that Sabeco is still a good long-term
investment for its strong fundamentals.
The case for investing in Sabeco is clear. But timing is everything. Although
SABECO’s share price was on a tear in recent years after reaching its peak by the end
of 2017, and has taken a pullback from its bottom price region of 140,000 VND per
share, our team still considers its current price region is too risky to invest in. It is
worth consideration for investors to wait for a dip and get a better entry point into this
stock. If any investors want to buy now and take risks, it is known that they’re paying
up for the quality of a top-notch business in the Vietnam Beer Industry.
Therefore, the decision to invest in Sabeco requires a careful analysis of the
risks and rewards. While Sabeco may be a good long-term investment opportunity,
investors should carefully weigh the risks and rewards before making a decision.
Timing is also a critical factor to consider, and our team’s advice to investors is not to
make any investment in Sabeco’s stock during this period.
In conclusion, investing in Sabeco can be a complex and challenging decision.
Taking on undue risk at this time may not be the best approach for investors looking
for a stable and secure return on their investment. Ultimately, it is up to each investor
to decide whether or not to invest in Sabeco, but they should do so with a thorough
understanding of the risks and rewards involved.

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REFERENCES
Cổ phiếu Sabeco giảm sâu xuống dưới 150.000 đồng/cp, khoản đầu tư 5 tỷ USD để nắm
quyền chi phối của tỷ phú Thái đã giảm phân nửa giá trị sau gần 4 năm. (2021,
September 4). CafeF.
https://cafef.vn/co-phieu-sabeco-giam-sau-xuong-duoi-150000-dong-cp-khoan-dau-tu-
5-ty-usd-de-nam-quyen-chi-phoi-cua-ty-phu-thai-da-boc-hoi-phan-nua-gia-tri-sau-gan-
4-nam-20210831095709415.chn
Cùng Sabeco thống trị ngành bia nhưng lợi nhuận của Habeco chưa bằng 1/10, lãi chỉ nhỉnh
hơn một số công ty bia địa phương. (2022, May 25). CafeF.
https://cafef.vn/cung-sabeco-thong-tri-nganh-bia-nhung-loi-nhuan-cua-habeco-chua-
bang-1-10-lai-chi-nhinh-hon-mot-so-cong-ty-bia-dia-phuong-20220524105615319.chn
HABECO. (2022). Audited Consolidated Financial Statement 2021.
https://static2.vietstock.vn/data/HOSE/2021/BCTC/VN/NAM/BHN_Baocaotaichinh_2
021_Kiemtoan_Hopnhat.pdf
Habeco và Sabeco: 'Cuộc 'so găng' giữa hai đối thủ ngành bia. (2022, October 4). Vietnamnet.
https://vietnamnet.vn/habeco-va-sabeco-cuoc-so-gang-giua-hai-doi-thu-nganh-bia-
2066425.html
Lãi khủng nhưng Sabeco vẫn còn nhiều việc phải làm. (2023, February 10). CafeF.
https://cafef.vn/lai-khung-nhung-sabeco-van-con-nhieu-viec-phai-lam-
2023021013425548.chn
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SABECO. (2022). Audited Consolidated Financial Statements 2021.
https://www.sabeco.com.vn/Data/Sites/1/media/co%20dong/bao%20cao%20tai
%20chinh/2021/2021/2021FS%20-%20CONSO%20-%20EN.pdf
THB. (2022). Audited Consolidated Financial Statement 2021.
https://biathanhhoa.com.vn/thong-tin-co-dong/bao-cao-tai-chinh-nam-2021/

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APPENDIX: FINANCIAL STATEMENTS OF SABECO, HABECO, AND
THANH HOA BEER

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