Vietnam Industrial Park Profits Drop 40% Despite FDI Surge
Registered foreign direct investment in Vietnam rose 76.4% to $50.4 billion in the first nine months of 2026, but industrial park developers saw H1 net profits fall due to land handover delays and rising costs.
FDI Surge Fails to Boost Developer Earnings
Vietnam's industrial park developers struggled to convert a significant rise in foreign investment into higher profits, SSI Securities reported. The country attracted $50.4 billion in registered foreign direct investment (FDI) during the first nine months of 2026, marking a 76.4% year-on-year increase.
Disbursed FDI also reached $21.1 billion over the same period, the highest level in five years. However, net profit for industrial park developers collectively declined by 40% in the first half of 2026, primarily due to slower land handovers, escalating costs, and changes in revenue recognition practices.
Mixed Performance Among Developers
The sector's net revenue fell 20.2% year-on-year to VND38 trillion ($1.47 billion) in H1/2026, with net profit dropping to VND4 trillion ($154.7 million), SSI Research noted. Becamex IDC Corp. (HoSE: BCM) reported a 65% revenue decrease to VND1.66 trillion ($64.2 million), with net profit down 82.7% to VND320 billion ($12.38 million).
Kinh Bac City (HoSE: KBC) saw revenue fall 46% and after-tax profit drop 79.2%. In contrast, Idico Corp. (HoSE: IDC) posted a 20.2% net profit increase to VND1 trillion ($38.67 million), while Viglacera Corp. (HoSE: VGC) recorded a 37.5% rise to VND1.15 trillion ($44.48 million).
Rising Costs and Margin Compression
Leasing activity showed signs of recovery in Q2/2026, with northern Vietnam achieving 217 hectares of net industrial land absorption, its highest since Q1/2024. Southern Vietnam recorded 67 hectares, up from 10 hectares a year earlier. Average industrial land rents also edged higher, reaching $143 per square metre in the north (up 2.9%) and $185 in the south (up 3.7%).
Despite this, rising development costs are impacting profitability. Construction material prices increased by approximately 20%, with compensation and site clearance costs remaining challenging. SSI Research estimates profit margins for new industrial parks have fallen to 30-35%, significantly below the over 50% achieved by existing parks.
Looking ahead, SSI Research forecasts new lease contracts and memorandums of understanding for companies under its coverage to total 1,000 hectares in 2027, an 18.6% year-on-year increase. Combined net profit for industrial park developers and rubber companies involved in land conversion is projected to reach VND22.3 trillion ($862.44 million), climbing 12.4%.
Viglacera is expected to achieve the strongest profit growth among covered companies, with earnings forecast to rise 29% in 2027, supported by new and existing industrial parks. Idico's sustained profit growth also underpins SSI's positive assessment.
This article is journalism, not investment advice; consult a licensed professional before making financial decisions. Market data is indicative, may be delayed, and should be verified with your broker or exchange before use.
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