The 5G revolution will warm up the phone market: The growth opportunity once again returns to FPT Shop, Mobile World?

Tram Ho

The saturated mobile industry is an unfamiliar story, and many large businesses in the industry soon had a solution for growth. Noting that in 2018, the television industry increased by about 10%, air-conditioners by 11%, other sectors were below 10%, compared to the previous year’s forecast is much lower. Entering 2019, GfK market research underestimates the mobile phone industry and ITC in general 2019, this is also the first year this industry no longer expects growth.

Cuộc cách mạng 5G sẽ hâm nóng thị trường điện thoại: Cơ hội tăng trưởng một lần nữa quay về với FPT Shop, Thế giới Di động? - Ảnh 1.

By 2020, FPT Shop and Mobile World will no longer have expectations in the mobile industry

And in fact, in 2019, MWG’s mobile phone segment only grew by 2%; Accordingly, the pillar of growth last year of this phone giant is located in the laptop – electronics – refrigeration segment with a growth rate of 10 – 20%, particularly air conditioners recorded a significant increase of about 60% compared to with 2018.

Cuộc cách mạng 5G sẽ hâm nóng thị trường điện thoại: Cơ hội tăng trưởng một lần nữa quay về với FPT Shop, Thế giới Di động? - Ảnh 2.

In 2019, MWG’s mobile phone segment only grows by 2%.

At FPT Shop, the company’s ICT revenue grew only 8%, lower than the expected 15%. The cause of the management is partly due to the decrease in purchasing power, partly from the weak iPhone flagship product.

Planning for 2020, neither MWG nor FPT Shop have any expectations for the mobile industry. Instead, MWG continues to promote Green Electronics as well as new categories: Watches, glasses … to maintain growth. MWG presents to the General Meeting of Shareholders the revenue plan of VND 122,445 billion, profit after tax of VND 4,835 billion, respectively increasing by 18% and 26% compared to the whole year of 2019. In particular, Bach Hoa Xanh is behind schedule to break even before G&A expenses, and MWG’s main contributor to growth in 2020 is Dien May Xanh.

Through the move to continue transforming the Mobile World store with a high volume of customers into Mini Green Electronics stores, changing the arrangement of the Mini Green Electronics store into large stores will continue to bring in ICT industry revenue growth. In parallel with the growth in revenue from watches and low-priced phones (occupying the new segment as well as anticipating the movement of consumers from high-end phones to low-end customers) … will also contribute revenue and Company profits.

Or FPT Shop, the business also expects not to set growth for the mobile industry, but will accept a year of strong investment in the pharmaceutical segment, looking for new ‘overlapping’ areas. “Only with ICT, we will be forever wandering and there is no way out. When calm down, looking back on the grand, FRT will persevere for the goals set out,” said the reins.

Setting an action strategy for 2020, according to the representative of FPT Shop, will have 2 issues:

+ First is the ICT array: FRT Retail (FRT) will aim to maintain the current index, not to raise growth, instead to optimize costs and increase profits.

+ Accessories and digital sims continue to be targets of profit improvement in 2020, in which the unfinished accessories plan in 2019 will continue to remain the same, equivalent to 1,000 billion in accessories revenue and 1 million sims.

VNDirect : The 5G revolution will warm up the phone market

However, along with the 5G revolution in the world, the mobile industry is facing an opportunity to grow again, in Vietnam is no exception, observers said.

Cuộc cách mạng 5G sẽ hâm nóng thị trường điện thoại: Cơ hội tăng trưởng một lần nữa quay về với FPT Shop, Thế giới Di động? - Ảnh 3.

Vietnam is rushing to deploy 5G technology and Viettel plans to commercialize 5G in 2020.

In the past, when 4G technology became popular in 2012 (GSMA Intelligence), the demand for smartphones has risen sharply. In particular, the Asia-Pacific region has seen a surge in 4G phone consumption (CAGR 2012-18 is 129%). For the next 5G wave, VNDirect Securities (VND) expects more than 1 billion 5G smartphone units to be consumed by 2025 (equivalent to a 58% penetration rate, according to Counterpoint estimates).

Moreover, according to Counterpoint, 5G smartphone sales will increase at a faster rate during the first four years of development than 4G handsets in the past thanks to the rapid deployment of 5G telecommunications networks in many country. In particular, Vietnam is rushing to deploy 5G technology and Viettel – the largest mobile operator in the country, has piloted 5G in Hanoi and Ho Chi Minh City and plans to commercialize 5G in 2020. VNDriect expects Vietnam will be a pioneer in the field of 5G and boost the demand for 5G receivers.

And accordingly, MWG and FPT Shop can benefit from the 5G wave when the mobile market has positive changes?

It is known that in 2019, the Government of Vietnam has issued Resolution 52 which outlines guidelines and policies to actively participate in the 4th industrial revolution. The strategy also aims to reach 5G network coverage. with affordable prices nationwide by 2030, according to the release.

To realize this vision, Vietnam plans to test 5G mobile networks in major urban centers like Hanoi and Ho Chi Minh City. Accordingly, the authorities issued the first license to test 5G for Viettel, Vietnam’s largest network with more than 60 million subscribers on a total population of nearly 100 million people. Viettel has tested 5G in Hanoi and Ho Chi Minh City in May 2019, other trials will soon be completed.

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Source : Genk