Retail sales in the first 10 months of 2025 rose 9.3 per cent year-on-year in nominal terms and 7 per cent in real terms, extending the recovery that began in 2024, according to a recently released report from Maybank IBG Research (Maybank). 

 

In recent years, both external and domestic pressures have made consumers more reactive to market news, causing confidence to swing more sharply over shorter periods.

 

A Kantar survey in the second quarter of 2025 showed consumer confidence falling to its lowest level since mid-2021, largely due to global trade uncertainties and wide domestic media coverage of campaigns targeting counterfeit and substandard goods.

 

Maybank expects sentiment to improve and consumption to strengthen in 2026, supported by an improved macro outlook, lower tariff risks and faster GDP growth, along with Government stimulus measures aimed at boosting domestic demand.

 

Better employment conditions, the easing of obstacles faced by household businesses and the improvement in asset values are also expected to play a role.

 

With the Government targeting a GDP growth rate of 10 per cent starting next year, Maybank anticipates continued demand-side policy support, given that household spending remains a key driver of Việt Nam’s economic expansion.

 

Likely policy measures include accelerating public investment disbursement; targeted support for real estate and tourism; extending VAT reductions to the end of 2026 (covering transport, logistics and ICT-related goods and services); removing tuition fees at public schools; and adjusting personal income tax to increase disposable income.

 

Listed retailers recorded another strong performance in the third quarter. Aggregate net profit attributable to shareholders rose 96 per cent year-on-year, following solid increases in the first and second quarters, up 53 per cent and 51 per cent respectively.

 

These results reflect a gradual improvement in consumption, the continued expansion of modern retail and better operating leverage.

 

All major companies exceeded expectations despite a still modest recovery in consumer demand, underscoring the sector’s resilience. Maybank forecasts the sector’s net profit to grow 55 per cent in 2025 and 26 per cent in 2026.

 

Modern retail

 

At the same time, tighter regulations are reshaping Việt Nam’s retail landscape, creating a more favourable environment for large, formal retailers. Traditional retail – long dominated by small family-run shops and wholesalers – has been hit hardest, with many temporarily closing or scaling down operations.

 

These shops often operated under lump-sum tax schemes and sold low-priced or unverified goods without invoices. The shift to revenue-based taxation and stronger enforcement is expected to narrow their price advantage, while giving modern retailers an opportunity to expand thanks to more competitive pricing and higher consumer trust.

 

Despite a clear move toward modern retail, Việt Nam’s market remains fragmented. With the exception of ICT and consumer electronics, modern retail penetration is still low across most product categories. This leaves considerable room for growth in groceries, pharmaceuticals and jewellery – segments where leading firms continue to invest.

 

Key developments include stricter oversight of informal retail, tougher action against counterfeit goods, enhanced tax compliance requirements such as mandatory e-invoicing and electronic record-keeping, and Government initiatives promoting e-commerce, modern trade and supply chain transparency.

 

These reforms are accelerating the consolidation of a more formal market structure, benefitting leading players like MWG, MSN, PNJ and FRT, which have large, strong brands and established compliance and supply chain systems.

 

Overall, Maybank maintains a positive outlook for the sector, supported by strong corporate earnings prospects and long-term growth potential. Analysts expect profits to remain elevated, while a possible upgrade of Việt Nam to Emerging Market status could serve as an additional catalyst for re-rating the retail sector. — VNS

 

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