FPT UNIVERSITY- CAMPUS HO CHI MINH

★★★★★

GROUP ASSIGNMENT (ECO111)

Lecture: Nguyen Thi Thanh Nhan

Class: IB1807

Group: 1

Student Name Student ID

Thái Quốc Huy SS180010

Bùi Lê Anh Quân SS180103

Trần Tiễn Nhật An SS180503

Nguyễn Thái Việt Anh SS180530

Hoàng Phúc SS180144

Nguyễn Nhật Huy SS180606

HO CHI MINH. 2023

TABLE OF CONTENTS
1. INTRODUCTION ..............................................................................................................2

History…........................................................................................................................….3

Economic sectors.................................................................................................................3

Vision.…………….............................................................................................................3

Mission...............................................................................................................................3

Objectives…………………………………………………………………………….......3

Outstanding achievements……………………………………………………………….3

2. BODY....................................................................................................................................4

2.1 Macro environment – PESTLE framework – Economic environment...........................4

2.1.1 Economic conditions..... .......................................................................................4

Stage of development in economy (Business cycle)……………………………..4

Economic resources………………………………………………………………4

The level of income……………………………………………………………….5

2.1.2 Economic policies.......................... ......................................................................5

2.1.3 Economic system....................................................................................................6

2.2 Strategies and applications…………………………………………………………….6

3. CONCLUSION...................................................................................................................7

4. REFERENCES ...................................................................................................................8

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Group Assignment ECO121 _ Group 1
 1. INTRODUCTION

Petrolimex is a leading petroleum and natural gas distributor in Vietnam. Petrolimex operates in
various areas, including production, import and export, and distribution of petroleum products and
other related services such as gas station operation and aviation fuel supply. As a vital state
enterprise, Petrolimex always brought into full play its predominant role in stabilizing and
developing the market in oils, petrochemical products meeting people’s demand, national economic
development, and defense security. (public.petrolimex.com.vn, n.d)

Table 1. General introduction

VNR500 rating 192(B1/2022)

Tax code 0101463614

Stock code PLC

Head office Tầng 18 & 19, Số 229 phố Tây Sơn - Phường Ngã Tư Sở - Quận Đống Đa -
TP. Hà Nội

Tel. 024-38513205

Fax 024-38513207

Website http://www.plc.petrolimex.com.vn/

Year of 09/06/1994
establishment

(VNR500, 2023)

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- History
Petrolimex, established in 1994, is the leading enterprise in Vietnam's petroleum market with a 50%
domestic market share. It was formed through the transfer and restructuring of the Vietnam
National Petroleum Corporation. With 43 member units and an extensive network of 5,500 petrol
stations, Petrolimex ensures convenient access to its petroleum products and services nationwide.
(petrolimex.com.vn, n.d)

- Economic sectors
Their core business sector focuses on petroleum business. Including petroleum trading, petroleum
transportation services, liquefied petroleum gas, and petroleum product manufacturing.
(petrolimex.com.vn, n.d)

- Vision
Their vision is to enhance the petroleum industry while focusing on improvement and development.
Their slogan, "Taking you further," shows their commitment to the customers. The company
supplies a wide range of eco-friendly and high-quality energy-types with high- standard.
(petrolimex.com.vn, 2017)

- Mission
Petrolimex’s mission is to ensure stability in the oil and gas market while contributing to national
energy security, focuses on modernizing their retail system, introducing non-cash payment methods,
and create a new brand identity throughout their network. Technological advancements and
innovation also play a vital role in improving production efficiency and enhancing competitiveness.
(petrolimex.com.vn, 2020)

- Objectives
Petrolimex’s objective is to become a top one petroleum enterprise in Vietnam, with a mainly focus
on petroleum business. They pursue a diversified ownership approach, concentrating resources on
investing in and developing related core business areas that support their operations. Moreover,
having an efficient business operations and increase benefits for its shareholders are also some
important objectives in the enterprise’s plan.

- Outstanding achievements
With over 20 years of operation, Petrolimex has achieved many remarkable successes and affirmed
its position as a dominant company in Vietnam's petroleum industry. Their strong reputation is built
on their commitment to safety, quality, and good financial performance. In 2022, The company has
been recognized for its outstanding annual reports and consistently ranks among the top 10
companies. (petrolimex.com.vn, 2022). Petrolimex's achievements reflect their leadership,
adaptability, and dedication to excellence in the petroleum market.

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2. BODY

2.1. Macro environment – PESTLE framework – Economic environment

2.1.1. Economic conditions

-Stages of development in economy (Business cycle)

The business cycle of Petrolimex is influenced by various factors such as the overall economic
situation, economic policies and consumer behavior, crude oil prices, and competition within the
industry.
Expansion phase: The overall economy of Petrolimex is expanding, leading to an increased demand
for energy products such as gasoline, diesel, and gas. In this phase, Petrolimex focused on some of
key areas such as Domestic market expansion, International Operations, Diversification of
Business……
Peak phase: Petrolimex recorded the highest profit during this phase because energy demand is
typically at its highest. According to the financial statement of Petrolimex, the consolidated pre-tax
profit is 5,093 billion VND in 2018, recorded as the highest to date. (petrolimex.com.vn, 2019)
Contraction phase: The demand for energy decreases, leading to lower profits for Petrolimex. For
example, Petrolimex achieved a record-breaking revenue of 67,020 billion VND in the first quarter
of 2022. However, the pre-tax profit of Petrolimex reached only 571 billion VND, experiencing a
significant decline of 44%. (markettimes.vn, 2022)
Trough phase: Petrolimex's 2020 pre-tax profit is projected to be 1,268 billion VND, representing
an 81% achievement of the annual plan and a 77.5% decline from 2019. This marks the company's
lowest profit level since 2015 due to COVID-19 and reduced oil prices.
(taichinhdoanhnghiep.net.vn, 2021)

-Economic resources
Weak impacts: Petrolimex faces challenges in terms of labor productivity and efficiency due to skill
gaps and limited training programs. Insufficient investment in physical capital, such as outdated
infrastructure and inadequate equipment, limits the company's operational effectiveness and
capacity for production, storage, and distribution. The company's human capital is also a weakness,
with a lack of highly skilled personnel hindering innovation and adaptability. Additionally,
Petrolimex's reliance on natural resources exposes it to risks associated with price volatility and
availability, impacting profitability. Insufficient technological development further weakens the
company by using outdated systems and processes, reducing competitiveness and hindering its
ability to leverage emerging technologies.

Strong impacts: Petrolimex benefits from a diverse workforce with various talents and skills. The
company has a strong financial position and invests in modern infrastructure and machinery to
improve efficiency and expand capabilities. Petrolimex prioritizes labor development through
continuous training programs, ensuring an innovative and skilled workforce. Abundant natural
resources, particularly oil and gas reserves, provide a secure supply for the company's operations.
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Additionally, Petrolimex is committed to technological advancement and adopts cutting-edge
systems and digital technologies to optimize processes and enhance customer experiences. These
strengths give Petrolimex a competitive advantage and help it maintain a leading position in the
industry.

-The level of income

In 2022, the average level of income is 6.700.000 VND per month, increase 16% compared to the
last year. (gso.gov.vn. 2023) As a result, the GDP per capita rises along with the increase of the
level of income. Rising incomes and improved living standards are likely to lead to an increase in
demand for petroleum products. This could result in increased revenues for Petrolimex, particularly
if it is able to maintain its dominant position in the petroleum downstream business. In order to
prepare for this growth in demand, Petrolimex may need to invest in expanding its distribution
networks and refining capacity, as well as improving efficiency and reducing costs. Additionally, it
may need to consider diversifying its business into renewable energy sources to keep up with
changing consumer preferences and environmental regulations. Conversely, if GDP per capita were
to decline, demand for petroleum products may decrease, which could negatively impact
Petrolimex's revenues. In this scenario, the company may need to focus on cost-cutting measures
and improving operational efficiency to remain competitive and profitable.

2.1.2. Economic policies

Petrolimex is significantly impacted by various economic policies that shape its investment
decisions, operational activities, and overall financial performance. The interest rate, as one of the
crucial economic indicators, plays a critical role in influencing Petrolimex's investment strategies.
When the interest rates are low, borrowing costs decrease, encouraging the company to invest in
expansion projects, research and development, and technological advancements. Lower interest
rates also stimulate consumer spending, increasing the demand for petroleum products and boosting
its revenue. Conversely, higher interest rates can deter investment as borrowing becomes more
expensive, potentially limiting the company's growth opportunities. (tuoitre.vn, 2023)

The exchange rate is another economic policy factor that significantly affects Petrolimex's
activities. As an international enterprise, Petrolimex is involved in importing and exporting
petroleum products, making exchange rates a crucial consideration. When the domestic currency
strengthens against foreign currencies, it reduces the cost of imports for Petrolimex, making it more
competitive and potentially increasing market share. Meanwhile, a stronger domestic currency can
negatively impact exports, making Petrolimex's products more expensive in international markets.
Therefore, exchange rate fluctuations can directly influence Petrolimex's profitability and market
position. (petrolimex.com.vn, 2010)

Taxation policies also hold substantial importance for Petrolimex. The tax framework affects the
company's financial performance and profitability. Higher tax rates can reduce Petrolimex's net
income, limiting its ability to reinvest in the business, undertake capital projects, or provide

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competitive pricing. Conversely, favorable tax policies, such as tax incentives for energy companies,
can positively impact Petrolimex's financial position and stimulate further investment and
expansion. That is to say, Petrolimex closely monitors and evaluates taxation policies to effectively
manage its financial resources and maintain a competitive edge in the market. (petrolimex.com.vn,
2018)

In summary, by carefully analyzing and adapting to these economic policies, Petrolimex can
navigate market dynamics and ensure sustainable growth in the highly competitive petroleum
industry.

2.1.3. Economic system

The best economic system for Petrolimex is mixed economy and the reasons why are:

First, a mixed economy will help Petrolimex to reach the Government’s goal. It allowed the
government to join and make sure that the economy in our country is stable and under control. This
helps the government to coordinate the activities of Petrolimex to deal with broader national
objectives.

The second is to balance the competition and the regulation of government. A mixed economy
allowed Petrolimex to compete with other competitors while still under the control of the
government, which maintains the balance of market force and state intervention.

The third one is to raise and maintain public benefit and social duty. Since Petrolimex is a state-
owned business in our country, it has the responsibility to help develop the social economy of our
country by dealing with broader national objectives such as energy aegis, and equality in providing
resources.

The final will be the stability and Economic strategy. A mixed economy helps the government to
maintain stability to make a long-term plan for economic development. By taking control of the
energy strategist part, … They can make sure that the supply and price and investment will be under
control, which will help develop the economy of our country.

2.2. Strategies and applications

As a petroleum corporation, Petrolimex is greatly affected by fluctuations in gasoline prices. It can

be seen that Petrolimex's profit in 2020 (1,252,572,208,332 VND) and 2022 (1,902,233,337,751
VND) is much lower than its profit in 2021 (3,123,734,179,723 VND) (s.cafef.vn, n.d) due to the
impact of the Covid 19 pandemic and war. Therefore, Petrolimex needs to improve by reducing the
risks that may occur when gasoline prices change. The first is to expand the product line. Multi-
item trading helps reduce losses when one item doesn't sell well. The second is to own long-term
contracts or commitments to supply petroleum with large corporations, which will increase the
stability of the business when the group always has a fixed/stable revenue in the long run. Another
problem that Petrolimex will face in the future is the replacement of petrol-powered vehicles with
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vehicles using environmentally friendly fuels. For example, electric vehicles are now appearing a
lot and gradually becoming a trend in the modern world. Therefore, adaptation is necessary,
Petrolimex must try to research and create environmentally friendly fuels. Or become one of the
first corporations in Vietnam to distribute a new environmentally friendly fuel when it is launched.
Finally, despite being the market leader in the petroleum industry in Vietnam, Petrolimex's position
in the international arena is still quite low. This is both a challenge and an opportunity for the
corporation's development. Petrolimex should increase in portfolio/foreign direct investment to
integrate into the world economy.

3. CONCLUSION

Petrolimex, the largest petroleum enterprise in Vietnam, faces various economic conditions, policies,
and systems impacting its growth. Petrolimex is impacted by numerous conditions and resources, it
benefits from a diverse workforce, strong financial position, and technological advancement. Rising
incomes may lead to increased demand for petroleum products. Economic policies such as interest
rates, exchange rates, and taxation policies strongly influence the activities of Petrolimex. A mixed
economy is the best economic system for Petrolimex to balance competition, government
regulation, and social duties. There are various strategies and applications for Petrolimex to
consider to improve their economic framework. Diversification of product lines and owning long-
term contracts with large corporations can help reduce risks and increase stability. The company
should also adapt to new trends, such as environmentally friendly fuels, and increase its presence in
the international market by increasing its portfolio and foreign direct investment. Overall,
Petrolimex should navigate the complexities of the market to ensure sustainable growth in the
highly competitive petroleum industry.

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4. REFERENCES

Data.worldbank.org. 2022. GDP per capita (current US$) - Vietnam [Online] Available at:<
https://data.worldbank.org/indicator/NY.GDP.PCAP.CD?locations=VN> [Accessed 11 July 2023]

Gso.gov.vn. 2023, Thông cáo báo chí kết quả khảo sát mức sống dân cư 2022 [Online] Available
at:< https://www.gso.gov.vn/su-kien/2023/05/thong-cao-bao-chi-ket-qua-khao-sat-muc-song-dan-
cu-2022/> [Accessed 11 July 2023]

Investopedia.com, 2022. Mixed Economic System: Characteristics, Examples, Pros & Cons [Online]
Available at:< https://www.investopedia.com/terms/m/mixed-economic-system.asp#toc-advantages-
and-disadvantages-of-a-mixed-economy> [Accessed 03 July 2023]

Markettimes.vn, 2022. Giá xăng tăng liên tục, doanh thu Petrolimex lập đỉnh nhưng lợi nhuận giảm
44% [Online] Available at:< https://markettimes.vn/gia-xang-tang-lien-tuc-doanh-thu-petrolimex-
lap-dinh-nhung-loi-nhuan-giam-44-2360.html> [Accessed 03 July 2023]

Petrolimex.com.vn, n.d. Giới thiệu Petrolimex [Online] Available at:<

https://www.petrolimex.com.vn/gioi-thieu-plx.html> [Accessed 11 July 2023]

Petrolimex.com.vn, n.d. Lĩnh vực hoạt động [Online] Available at:<

https://www.petrolimex.com.vn/linh-vuc-hoat-dong.html> [Accessed 11 July 2023]

public.petrolimex.com.vn, n,d. About Petrolimex. [Online] Available at:

<https://public.petrolimex.com.vn/introduction/about-petrolimex/history_and_development.html>
[Accessed 03 July 2023]

Petrolimex.com.vn, 2010. Tác động đa chiều sau khi tỉ giá được điều chỉnh [Online] Available at:<
https://www.petrolimex.com.vn/nd/bao-chi-viet-ve-petrolimex-va-xang-
dau/tac_dong_da_chieu_sau_khi_ty_gia_duoc_dieu_chinh.html > [Accessed 03 July 2023]

Petrolimex.com.vn, 2017. Tầm nhìn Petrolimex [Online] Available at:<

https://www.petrolimex.com.vn/gioi-thieu/gioithieu-petrolimex/tam_nhin_petrolimex.html >
[Accessed 11 July 2023]

Petrolimex.com.vn, 2018. Bộ tài chính: Tăng thuế xăng dầu để cân bằng ngân sách, bảo vệ lợi ích
quốc gia [Online] Avaiable at:< https://www.petrolimex.com.vn/nd/bao-chi-viet-ve-petrolimex-va-
xang-dau/bo-tai-chinh-tang-thue-xang-dau-de-can-bang-ngan-sach-bao-ve-loi-ich-quoc-gia.html>
[Accessed 03 July 2023]

Petrolimex.com.vn, 2019. Financial report 2018 [Online] Available at:<

https://www.petrolimex.com.vn/ndi/bao_cao/bao-cao-tai-chinh-hop-nhat-da-duoc-kiem-toan-nam-
2018-petrolimex.html > [Accessed 12 July 2023]

Petrolimex.com.vn, 2020. Petrolimex/PLX xác định 4 nhiệm vụ & 7 giải pháp giữ vững vị thế chủ
lực & tiền phong [Online] Available at:< https://www.petrolimex.com.vn/ndi/thong-cao-bao-
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chi/petrolimex-plx-xac-dinh-4-nhiem-vu-7-giai-phap-giu-vung-vi-the-chu-luc-tien-phong.html>
[Accessed 11 July 2023]

petrolimex.com.vn, 2021. Annual report 2021 [Online] Available at: <

https://files.petrolimex.com.vn/files/6783dc1271ff449e95b74a9520964169/application=pdf/5fe8bb
7ee9154df6bbc0647f85416b91/20220531_PLX_AR2021_EN_Final_Highres.pdf > [Accessed 03
July 2023]

Petrolimex.com.vn, 2022. Petrolimex được vinh danh Top 10 doanh nghiệp niêm yết nhóm vốn hóa
lớn có BTCN tốt nhất năm 2022. [Online] Available at:< https://www.petrolimex.com.vn/nd/tin-
chuyen-nganh/petrolimex-duoc-vinh-danh-top-10-doanh-nghiep-niem-yet-nhom-von-hoa-lon-co-
bctn-tot-nhat-nam-2022.html> [Accessed 11 July 2023]

s.cafef.vn, n.d. PLX - Tập đoàn xăng dầu Việt Nam (HOSE). [Online] Available at:<
https://s.cafef.vn/hose/plx-tap-doan-xang-dau-viet-nam.chn > [Accessed 11 July 2023]

Taichinhdoanhnghiep.net.vn. 2021. Lợi nhuận Petrolimex giảm gần 78% trong năm 2020 [Online]
Available at:< https://taichinhdoanhnghiep.net.vn/loi-nhuan-petrolimex-giam-gan-78-trong-nam-
2020-d18221.html > [Accessed 03 July 2023]

Tinnhanhchungkhoan.vn. 2022. Petrolimex (PLX): Doanh thu qúy I/2022 tăng 75%, song lợi nhuận
giảm 40% [Online] Available at:<https://www.tinnhanhchungkhoan.vn/petrolimex-plx-doanh-thu-
quy-i2022-tang-75-song-loi-nhuan-giam-40-post296944.html> [Accessed 03 July 2023]

Tuoitre.vn. 2023. Có thể thu về hơn 2.500 tỉ từ thoái vốn ngân hàng, Petrolimex sẽ làm gì? [Online]
Available at:< https://tuoitre.vn/co-the-thu-ve-hon-2-500-ti-tu-thoai-von-ngan-hang-petrolimex-se-
lam-gi-20230322192825403.htm> [Accessed 03 July 2023]

vnr500.vn, 2023. Thông tin doanh nghiệp [Online] Available at: < https://vnr500.com.vn/Thong-tin-
doanh-nghiep/TONG-CONG-TY-HOA-DAU-PETROLIMEX--CTCP-Chart--234-2022.html >
[Accessed 30 June 2023]

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