BAF Vietnam Plans 20% Stock Dividend, VND 1,200B Bond for Sow Herd Expansion

Overview

BAF Vietnam Joint Stock Company (HOSE: BAF) has submitted documents for its 2026 Annual General Meeting of Shareholders outlining plans to significantly increase financial capacity for expansion. The proposals include a 20% stock dividend/bonus, an ESOP issuance, and a VND 1,200 billion convertible bond issue, aiming to raise charter capital above VND 3,700 billion. This capital raise supports a strategic goal to nearly double its sow herd to 145,000 and integrate the CEO of its largest shareholder into the board.

Key Facts

• Proposes issuing nearly 69 million shares via a 10% stock dividend and 10% bonus share issuance from owner’s equity.
• Plans to offer 8 million shares under an Employee Stock Ownership Plan (ESOP) at VND 10,000 per share.
• Intends to issue up to VND 1,200 billion in convertible bonds with a 36-month term and fixed 10% annual interest rate.
• Targets raising total charter capital to over VND 3,700 billion (approx. $148 million USD).
• Aims to expand sow herd to 145,000, nearly double the 2025 figure, with 16 new farms in the Central Highlands and Central regions.
• Sets 2026 consolidated revenue target of VND 8,431 billion (~70% year-on-year growth) and net profit target of VND 793 billion.
• Proposes electing Mr. Nguyễn Văn Phú, CEO of Siba Holdings (31.47% shareholder), to the Board of Directors for the 2026-2031 term.

What Happened

According to filings for the 2026 Annual General Meeting of Shareholders, BAF Vietnam is seeking shareholder approval for a comprehensive capital increase plan. The company proposes a combined 20% distribution through a 10% stock dividend and a 10% bonus share issue, alongside an ESOP offering of 8 million shares at VND 10,000 each. Concurrently, it plans to issue convertible bonds worth up to VND 1,200 billion, with proceeds allocated VND 700 billion for pig farming operations and VND 500 billion for debt restructuring.

The capital raise is directly linked to an aggressive expansion of production infrastructure. BAF aims to develop 16 new farms and nearly double its sow herd to 145,000. A centerpiece is a high-tech, multi-story pig farming project in Tây Ninh, developed in strategic cooperation with China’s Muyuan Group, with total investment of VND 12,000 billion. This project, targeting 64,000 sows and 1.6 million market pigs annually, is slated to break ground in 2026 and is expected to generate annual revenue of about VND 10,000 billion at stable operation.

Market Context

BAF trades on the Ho Chi Minh City Stock Exchange (HOSE). In the morning session on April 14, BAF stock was trading sideways around the reference price of VND 35,000 per share. The company’s capital-raising plans come as it reported consolidated net profit of over VND 120 billion for 2025, a period of industry-wide pressure from disease outbreaks. The ambitious 2026 profit target of VND 793 billion represents a significant projected recovery and growth, contingent on a rebound in live hog prices and optimized production costs.

Strategic Significance

The proposed actions signal a shift towards a capital-intensive growth model for BAF. The convertible bond issuance, rather than pure equity dilution, provides flexible financing for rapid scale-up. Integrating the CEO of Siba Holdings onto the board strengthens governance ties with its largest shareholder, potentially streamlining strategic alignment. The expansion, particularly the joint venture with Muyuan Group, positions BAF to capture economies of scale in high-tech pig farming, a segment with higher barriers to entry and potential for better cost control and disease management.

What to Watch

• Shareholder vote on the capital increase proposals at the 2026 Annual General Meeting.
• Final terms and pricing of the VND 1,200 billion convertible bond issuance.
• Progress on breaking ground for the Tây Ninh joint venture project with Muyuan Group in 2026.
• Quarterly financial results in 2025-2026 to track progress toward the VND 793 billion net profit target.
• Updates on sow herd growth toward the 145,000 target.