From Cables to Rare Earths: LS Completes Its Blueprint in Vietnam [Armistice Talks and the 'New East Road' (Part 2)]

[Financial News, Hanoi, Vietnam = Correspondent Kim Jun-seok] "If the past 30 years were a time of growing alongside Vietnam and building trust, the next 30 years will be a time to lead projects that will reshape the country's infrastructure landscape."
Jang Dong-wook, head of LS VINA, the Vietnamese production unit of LS Eco Energy, the Asia business holding company of LS Cable & System, said this in an interview with this newspaper as he reflected on the significance of the group's 30 years in Vietnam.
Not only LS Cable & System, but also LS ELECTRIC and E1 are accelerating their expansion in the power and energy businesses by mobilizing the group's core capabilities to mark 30 years in Vietnam. Their strategy is to develop Vietnam, which once served mainly as a production base, into a key hub for LS Group's Southeast Asia business spanning power infrastructure, energy and core materials.
■ LS Eco Energy expands its territory from AI data centers to rare earths
Since establishing LS VINA, its power cable production unit in Vietnam, in 1996, LS Eco Energy has steadily expanded its business. In April, 30 years after entering the market, it surpassed 1 trillion won in cumulative annual sales in Vietnam for the first time since its founding, cementing its position as the No. 1 cable company in ASEAN.
More recently, it has also moved into the data center market, targeting the surging demand for artificial intelligence (AI) infrastructure. On the 14th of last month, it signed a contract to supply core power cables for a 60 MW hyperscale AI data center being built by Viettel Group, Vietnam's largest state-run telecom company, in a new city near Hanoi.
LS Eco Energy is also speeding up its rare-earth business, a key part of the ongoing geopolitical supply chain reshuffle. A notable example is the 28.5 billion won investment in rare-earth metalization facilities at its Ho Chi Minh City production unit (LSCV), approved by the board in December last year.
In March, LS Eco Energy secured its raw material supply chain by signing a binding comprehensive cooperation agreement with Lynas Rare Earths of Australia. It is the only region outside China where full commercial production across the rare-earth processing chain is possible. The company is building a refining plant aimed at initial production by the end of this year, and the rare-earth metals produced there are expected to be supplied to the global robotics and defense value chains, including permanent magnets.
Na Min-sik, a researcher at SK Securities, said that once the rare-earth metal business gains momentum, the company could be revalued as a key supplier of materials for the robotics and defense value chains, moving beyond its image as a simple cable maker.
■ LS ELECTRIC responds to demand in North America and Europe by using Vietnam as an export outpost
LS ELECTRIC, a power equipment maker, is also rapidly expanding its presence in the Vietnamese market. Since establishing a local production unit in 1997, the company has broadened its business, and in 2022 it completed a new plant in Bac Ninh Province in the north, significantly increasing production capacity.
In particular, the Bac Ninh unit is serving as a key export base that helps absorb orders from the South Korean headquarters, which has been under strain due to explosive demand in North America and Europe. It is growing into a production hub not only for Vietnam's domestic market but also for ASEAN, North America and Europe, with a goal of lifting local sales to more than $100 million, or about 154 billion won, by 2030.
LS ELECTRIC, which posted record-high sales and operating profit in the first quarter, said that sales at its Vietnam unit rose 45% from a year earlier.
■ E1 builds LPG terminal, says Vietnam is its 'second home'
E1, which handles the energy business, is also stepping up its push into Vietnam. The country is the first base in its overseas 'second home' strategy, which aims to overcome the limits of growth in the domestic liquefied petroleum gas (LPG) distribution market. E1 said that LPG demand in Vietnam is rising rapidly as the economy grows and incomes improve, while LPG-based petrochemical industries such as the propane dehydrogenation (PDH) process are also expanding quickly. It called Vietnam the most suitable market for pursuing its second-home strategy.
In partnership with a local company, E1 has built and begun commercial operation of an 80,000-ton refrigerated LPG terminal at the Bac Tien Phong Industrial Park in Quang Ninh Province. The investment is intended to meet rising LPG demand in northern Vietnam. Based on this facility, E1 plans to expand industrial LPG supply and broaden its local distribution network.
A local source in Vietnam said, "LS Group is expanding its cable, power equipment and energy infrastructure businesses at the same time, while developing Vietnam into a key hub for its Southeast Asia operations."
rejune1112@fnnews.com Reporter