Sustainable Investing: Driving Long-Term Value with Moc Chau Milk

Responsible investing is integral to our business. Adopting a long-term and sustainable mindset lets us measure value in years rather than days or months. Therefore, we strive to meet then exceed our corporate social responsibility (CSR) commitments by fusing ESG analysis into our investment process.

Equally, the standards we set for ourselves apply to the companies in which Kenno invests. As such, we seek sustainability-driven governance and ethical business practices in our target holdings and those already in the portfolio.

A worthy example of a company whose sustainable business approach creates long-term value is Vietnam’s Moc Chau Milk (MCM).

Established in 1958, MCM is a leading dairy business in the north of Vietnam that is expanding its reach across the country. The company’s product range encompasses traditional fresh milk products, yoghurts, fruit juices, and cheese. Its shares began trading on the Hanoi Stock Exchange Unlisted Public Company Market (UPCoM) in December 2020.

Notably, MCM operates a closed-loop supply chain that ensures the sustainability of its fresh milk from the farm to end production. The company also owns a total mixed ration (TMR) factory producing up to 150 tonnes of animal food per day, which is utilised in MCM’s own farm and sold to contracted farmers. The current Moc Chau factory has a total capacity of 121,000 tonnes of milk per year.


“We like how MCM engages in long-term partnerships with local farmers by providing support and ensuring sustainable output from their dairy cattle,” notes Kenno’s Senior Analyst, Dung Nguyen.

According to the General Department of Vietnam Customs, Vietnam’s dairy herd numbered 375,000 cows in 2021, with fresh milk production of over 1.2 million tons. Yet, this equates to only 42% of domestic dairy demand. As such, Vietnam must import from countries such as Australia and New Zealand. However, MCM can fully self-supply its operations with fresh milk from a herd of around 26,000 cows.

In addition, the company is also investing in a new eco-tourism farm in the highland province of Son La. The development, which is also a commercial operation with a 4,000-cow capacity, further strengthens MCM’s ability to self-supply with fresh milk.

“MCM places a great deal of emphasis on improving the health and welfare of its cows using advanced farming methods and equipment. Over time, this will enhance its milk yield and quality,” adds Dung.

The ground-breaking ceremony of Moc Chau Milk eco dairy complex in Son La province (May 2022)

The ground-breaking ceremony of Moc Chau Milk eco dairy complex in Son La province (May 2022)

Published 02/2023

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