Recent increases in global oil prices, driven by geopolitical tensions, have raised concerns about potential spillover effects on inflation and consumer demand. In this note, we assess how these developments may affect our portfolio companies across sectors.
Overall, the impact remains limited. While higher energy costs can influence logistics, input prices, and consumer sentiment, most of our holdings operate in essential sectors or maintain sufficient pricing flexibility to manage short-term cost pressures.
MWG is fairly well‑positioned to handle higher energy costs. Its diverse business mix provides stability, with about 68% of revenue coming from phones and electronics, while the remaining portion comes from essential goods such as groceries, FMCG products, and pharmaceuticals. Demand for phones and electronics may soften if high oil prices persist and consumers turn more cautious, but its grocery chain, Bach Hoa Xanh, provides a stable and resilient source of revenue. On the other hand, higher fuel costs do affect MWG’s transport and logistics network, though logistics typically account for less than 4% of its revenue, so the overall impact should remain manageable.
MWG also has room to adjust selling prices, given its unrivalled 50-60% market share in phones & electronics, and 25% market share in the modern grocery & FMCG. In groceries, it can make small pricing changes on essential goods without disrupting demand. Meanwhile, in phones and electronics, its strong market position allows the company to negotiate better terms with suppliers, helping offset short‑term increases in logistics costs without passing the burden to consumers or weakening its market leadership.
FPT faces almost no impact during this time. Its core IT services, including digital transformation, which contribute 63% to revenue and over 50% to net profit, are considered essential by both domestic and global clients to stay competitive, so demand is expected to remain steady. Its other segments, such as telecom and education, are also everyday necessities. On the other side, FPT is largely insulated from energy volatility because its main expense is labor cost rather than fuel or raw materials. While data centers do use electricity, this segment only makes up less than 3% of the consolidated revenue.
Last but not least, FPT also benefits from a strong bargaining power. Its services are mission-critical for clients, and the company maintains a clear cost advantage over global competitors, with engineer salaries 15-20% lower than those of Indian peers. This allows FPT to adjust pricing when needed without disrupting client relationships or affecting demand.
MSN is only slightly affected by rising crude oil prices. Around 90% of its revenue comes from consumer goods such as fish sauce, soy sauce, instant noodles, beverages, coffee, home and personal care products, as well as fresh and processed meat. It also operates modern retail outlets for groceries and FMCGs in Vietnam. These are everyday essentials, so demand remains steady in both the short and long term.
Higher gasoline prices increase logistics costs, and packaging costs are also tied to crude oil prices since materials like plastic, PET bottles, and laminates come from petrochemicals. Even so, Masan Group is well-positioned to pass these higher costs on to customers thanks to its strong market presence. It holds a 65–70% share in cooking sauces and 15–20% in instant noodles. With about 4,600 minimarts and supermarkets nationwide, it is the largest retailer in Vietnam. The company also owns many trusted brands with strong customer loyalty across its product lines.
For FRT, the recent rise in energy costs highlights why its shift toward healthcare has been so important. The traditional FPT Shop business could feel pressure if inflation weakens demand for non-essential phones and electronics, but the Long Chau pharmacy chain offers meaningful stability; Long Chau now contributes roughly 70% to FRT’s consolidated revenue, and most of its profit. Medicines and treatments are everyday necessities, so sales here tend to hold up even in tougher conditions.
Higher fuel and electricity prices do affect FRT’s nationwide logistics, especially with the cold chain requirements for pharmaceuticals. Still, the company’s large, centralized distribution system helps soften the impact unless energy prices stay elevated for a long period. Most importantly, Long Chau has strong pricing power because it is the largest modern pharmacy chain, holding over 12% market share in a landscape dominated by over 50,000 mom‑and‑pop pharmacies. This scale, together with steady demand for essential medicines, allows FRT to pass on small cost increases without affecting customer behavior.
The current geopolitical tension and rising energy costs create mixed implications for PNJ. On one hand, demand for high-end jewelry can soften if inflation puts pressure on household budgets, since these purchases are more discretionary. On the other hand, periods of uncertainty often lead to a stronger interest in 24K gold as a safe-haven asset, which helps support overall sales.
Regarding the costs, PNJ’s direct energy expenses are limited, but movements in global gold prices have a much larger effect on its business. In this environment of increased volatility, PNJ’s main advantage is its ability to adjust retail prices quickly to reflect market movements. This flexibility helps the company protect margins even when gold prices fluctuate, without relying on temporary factors such as low‑cost inventory.
For VRE, the current energy backdrop also has mixed implications for its leasing business. On the demand side, mall traffic and tenant sales are naturally cyclical, and if inflation continues to squeeze household budgets, some retail tenants may turn more cautious. Even so, VRE’s balanced tenant mix – anchored by over 50% from supermarkets, F&B, and other essential services – helps maintain steady footfall across its malls. On the other hand, operating large retail spaces is energy‑intensive. VRE’s exposure to power price is high, with over 40% direct costs coming from air conditioning, lighting, and facility maintenance.
However, the volatility of power prices in Vietnam is relatively low because the national grid relies heavily on hydropower and renewables, as mentioned above. Moreover, VRE lease structures allow most utility and maintenance cost changes to be passed through to tenants via service charges. In general, given its dominant 40% market share in the retail mall market, VRE is well-positioned to sustain high occupancy rates and operating margins under these circumstances.
TNH is expected to be immune to the current situation. Medical care is essential, so patients rarely delay important check-ups or treatments, even when household budgets are under pressure. This helps keep TNH’s patient volumes and bed occupancy stable, though there could be a small shift to public hospitals when consumer incomes are affected.
From a cost perspective, as electricity accounts for only 1.5% of TNH's revenue, the company isn’t heavily exposed to global energy price fluctuations. Most of TNH’s expenses come from medical staff and specialized supplies rather than fuel or raw energy. More importantly, as healthcare demand continues to grow among Vietnam’s middle-income population, the hospitals of TNH can make gradual fee adjustments to cover rising costs without meaningfully affecting patient traffic.
TRA is a pharmaceutical manufacturer, with 60% of its revenue from Eastern medicines and 40% from Western medicines. Demand for its products remains steady because both its herbal products (like the liver tonic Boganic) and its modern medicines are everyday essentials for many patients. People simply don’t cut back on chronic or routine medications, even when the economy slows.
On the cost side, TRA does get some relief from sourcing many of its herbal ingredients domestically, but it’s not completely insulated. Supplying nearly 30,000 pharmacies across the country requires fuel-intensive logistics, and the imported ingredients used in its western medicines are often influenced by global petrochemical prices. However, these will be offset thanks to TRA’s strong pricing power. The market has fewer low‑cost competitors now because many small, lower‑quality producers exited after stricter regulations. This, combined with a well-established national brand, helps TRA adjust prices when needed without risking its market share.
MML is a branded meat company with an integrated value chain from farming to fresh meat and processed meat. 100% of its revenue is branded fresh and processed meat for domestic consumers, of which the demand is resilient in any macroeconomic situation. MML must import corn and soybeans for its farming business (24% of total revenue). The prices of corn and soybeans are linked to crude oil prices because oil is a critical input for agricultural production, and these commodities are used as feedstocks for biofuels (ethanol and biodiesel), creating a direct demand link. Higher corn and soybean prices can lead to an increase in the production cost of farming and the meat business. The farming business is a commodity business, in which MML is a price taker in the market.
For the branded fresh meat business (41% of total revenue), MML can partially pass along higher input costs to customers thanks to its strong brand and extensive sales network. For the processed meat business (35% of total revenue), we believe MML can pass along higher input costs to customers, similar to other branded consumer products.
NLG’s residential development business faces mixed effects from the energy prices. On the demand side, real estate is cyclical, and higher interest rates can make buyers more cautious. Even so, about 70% of NLG’s landbank is in affordable and mid‑range homes, which tend to have more resilient demand because first‑time buyers still prioritize housing even in a weaker economy.
The cost side is more challenging. Construction materials such as steel, cement, and glass are highly energy-intensive to produce and transport, so prolonged high oil prices will push up overall project expenses. Passing these higher costs on to buyers is not straightforward either. If higher inflation leads to higher interest rates, homebuyer confidence could soften. Although NLG’s prices are affordable, raising them too much could slow sales.
In general, our portfolio is well-balanced and handles the current energy shock comfortably. Our largest exposure – Phone and Consumer Electronics Retail – may see some minor impacts if inflation slows discretionary spending. However, our representative portfolio company, MWG, as mentioned above, is poised to closely collaborate with suppliers to support customers in that scenario of prolonged conflicts.
On the other hand, this effect is strongly offset by our significant weight in essential, non‑discretionary sectors. Grocery retail, F&B manufacturing, pharmaceuticals, and hospitals together make up more than half of total revenues, and demand in these areas stays firm regardless of economic conditions. These businesses also have enough pricing flexibility to manage rising logistics and input costs. Furthermore, while a potential energy-driven rise in interest rates could slightly elevate financing costs for a few holdings with higher debt-to-equity ratios like MSN and MML, the majority of our companies maintain strong net cash positions and remain completely insulated. Consequently, the broader impact of higher interest rates is minimal, ensuring our portfolio as a whole remains highly resilient.
Given solid fundamentals and sustainable cash flow, we believe our consumer- and healthcare-focused portfolio will outperform the broader market amid uncertainty.