Australia partner willing to invest $100 mln in Hoa Binh: CEO
Four partners have shown an interest in a share issuance of leading Vietnamese construction contractor Hoa Binh (HBC) and one of them, from Australia, said it is willing to spend $60-100 million, revealed CEO Le Van Nam on Tuesday.
At the company’s annual general meeting in Ho Chi Minh City the same day, HBC shareholders approved a plan for a private placement of 274 million shares with a minimum price of VND12,000 ($0.51) per share in 2023. If successful, the minimum proceeds have been estimated at VND3.29 trillion ($139.77 million), Nam said.
The proceeds will be used to supplement business capital, swap debt with partners (subcontractors, suppliers, manufacturers), service loans, and invest in project development, he said, adding that as of June 23, 89 suppliers and subcontractors had agreed to swap debts for shares with a total value of VND650 billion ($27.6 million).
According to vice chairman and deputy CEO Le Viet Hieu, the corporation is targeting VND12.5 trillion ($531.2 million) in consolidated revenue and VND125 billion ($5.3 million) in consolidated profit in 2023.
"In its business strategy for 2024-2026, HBC aims to reduce the debt-to-equity ratio to 1, and start to make a profit from 2024, which will reach VND600 billion ($25.5 million) by 2026. Its gross and net profits are expected to increase by 6% and 2% in 2024, and 9% and 4% in 2026, respectively," he said.
In a letter to shareholders ahead of the meeting, HBC chairman Le Viet Hai affirmed that the current difficulties are just temporary and when the “storms” disperse, the company will continue to develop, restore its position, and come back strongly.
He stated that 2022 and 2023 had been the most difficult periods for Hoa Binh during its over-35-year journey. Over the past five years, the construction industry has suffered, particularly in the urban housing and resort sectors - the company's two main construction fields.
Since 2017, very few urban housing projects have been granted construction permits, resulting in a shortage of jobs, he said, noting that a supply and demand imbalance had caused negative impacts on contractors and the competition has become fiercer than ever.
"In 2020 and 2021, the prolonged Covid-19 pandemic dealt a heavy blow to the entire economy and the construction industry in particular. HBC’s revenue plunged by 40%,” he said.
Negative global developments and in Vietnam in particular have left construction businesses, including HBC, struggling even more, he added.
Last year, for the first time, Hoa Binh suffered a loss of over VND2.57 trillion ($109.2 million). Particularly, its provision for bad receivable debts amounted to over VND2.06 trillion ($87.55 million).
Hai admitted that he had not fulfilled his obligation to develop Hoa Binh as expected, failing to meet the trust and expectations of shareholders. He also took responsibility for a number of scandals that seriously affected the reputation of the board of directors and the Hoa Binh brand, which had long been praised for a corporate culture imbued with humanity and peace.
"However, I am not ashamed of myself or anyone else since I have done all I can to help the company overcome these difficulties over the years. My decisions were all made on the principle of protecting the best interests of shareholders, even though sometimes I had to sacrifice my own interests," he said.
The company chairman hoped to receive sympathy and solidarity from shareholders to help Hoa Binh weather the storm for growth.
According to him, Hoa Binh had taken a step back to renew with a comprehensive restructuring strategy focusing on finance, human resources, products and markets, management systems, and its network of members and associated companies.
Hoa Binh reported a net loss of more than VND440 billion ($18.75 million) in the first three months of 2023, marking its second quarterly loss in a row. In the same period, its revenue plunged nearly 60% year-on-year to VND1.2 trillion ($51.14 million).
At the end of Q1/2023, its accumulated losses of more than VND1.1 trillion ($46.88 million) exceeded its charter capital (VND2.74 trillion) by more than 40%.
On May 17, the Ho Chi Minh Stock Exchange announced the transfer of HBC shares of Hoa Binh from controlled to restricted trading starting May 23, because the company had delayed the submission of its 2022 audited financial statement by more than 45 days.
HBC closed the Tuesday session at VND9,460 ($0.4), up 5.23%.
- Read More
Vietnam developer Novaland denies involvement in violations at Central Highlands property project
Real estate major Novaland asserted on Monday that it was neither aware of nor involved in any violations of the law by its partner or other parties concerned in a Central Highlands eco-resort and urban area project.
Companies - Tue, November 5, 2024 | 2:36 pm GMT+7
Vietnam central bank likely to raise interest rates in Q2 next year: StanChart
The Vietnamese central bank is forecast to lift interest rates by 50 basis points in Q2/2025 due to a pickup in inflation, a Standard Chartered economist has said.
Economy - Tue, November 5, 2024 | 2:01 pm GMT+7
Chinese e-commerce giant Temu receives tax code, still unlicensed
Temu, the e-commerce platform under China’s PDD Holding, has been given tax identification number 9000001289 for its tax duty in Vietnam, says the General Department of Taxation (GDT) under the Ministry of Finance.
Companies - Tue, November 5, 2024 | 12:05 pm GMT+7
Korea soju producer HiteJinro targets annual output of 70 mln liters in Vietnam
South Korea's HiteJinro, a leading producer of traditional alcoholic beverage soju, targets an annual output of 70 million liters of soju and fruit-flavored soju under the Jinro brand for its to-be-built factory in Vietnam.
Industries - Tue, November 5, 2024 | 10:13 am GMT+7
Vietnam stock market may receive $9 bln from overseas funds once upgraded: Morgan Stanley
International funds may pour up to $9 billion into Vietnamese equities once Vietnam’s stock market status is upgraded from a frontier to an emerging market, says a Morgan Stanley representative.
Finance - Tue, November 5, 2024 | 9:33 am GMT+7
Vietnam oil & gas sector’s Q3 profits up for upstream firms, down for downstream firms
Upstream oil and gas companies in Vietnam reported robust profit growth in the third quarter of this year, but downstream peers were hit by declining oil prices.
Companies - Tue, November 5, 2024 | 8:01 am GMT+7
Indonesia targets comprehensive fuel subsidy scheme reform
Indonesian Energy Minister Bahlil Lahadalia has said the country is conducting a thorough exercise to reform its fuel subsidy scheme.
Southeast Asia - Mon, November 4, 2024 | 10:50 pm GMT+7
Tech companies invest in data centers in Thailand
Thailand’s Board of Investment (BOI) has approved investment support for two large data centre projects in the country worth over THB60 billion ($1.7 billion).
Southeast Asia - Mon, November 4, 2024 | 10:49 pm GMT+7
Indonesia upgrades sea wall system to protect Jakarta
Indonesian Coordinating Minister for Infrastructure and Regional Development Agus Harimurti Yudhoyono has stated that the construction of sea walls was one of the priorities of President Prabowo Subianto.
Southeast Asia - Mon, November 4, 2024 | 10:47 pm GMT+7
Where real estate and urban development meet
The Transit-Oriented Development (TOD) itself, if properly planned and implemented, can lower the barrier to the use of public transport, lessen the dependency on private vehicles, contributing to the liveability of communities and cities, write Avison Young Vietnam analysts.
Consulting - Mon, November 4, 2024 | 8:49 pm GMT+7
AI helps sellers offer competitive prices on e-commerce platforms: Lazada trainer
When sellers carry out promotions on e-commerce platforms, artificial intelligence can help ensure their prices remain competitive, says Nguyen Tran Tin, a seller and trainer at Lazada Academy.
Companies - Mon, November 4, 2024 | 8:07 pm GMT+7
Vietnam plans $7.3 bln rail route linking 2 northern provinces bordering China
Vietnam Railway Authority under the Ministry of Transport has proposed a 448-km long, VND183,856 billion ($7.26 billion) route running between the northern provinces of Lao Cai and Quang Ninh, both sharing a border with China.
Infrastructure - Mon, November 4, 2024 | 7:14 pm GMT+7
Vietnam agribusiness HAGL trains focus on domestic market, inks pact with Kingfoodmart
Vietnamese agri major Hoang Anh Gia Lai JSC (HAGL) is looking to tap domestic market potential afresh by distributing its products through the Kingfoodmart supermarket chain.
Companies - Mon, November 4, 2024 | 7:08 pm GMT+7
Mixed performance by Vietnam commercial banks in Q3
Vietnamese commercial banks have had a mixed third quarter, with some reporting substantial profit gains while others seeing steep declines or even losses.
Banking - Mon, November 4, 2024 | 4:52 pm GMT+7
Vietnam’s Vingroup, UAE's NMDC to collaborate in offshore wind power
Vietnam’s leading conglomerate Vingroup and the UAE-based NMDC Group will collaborate in offshore wind power, the latter said in a recent filing sent to the Abu Dhabi Securities Exchange (ADX).
Energy - Mon, November 4, 2024 | 4:20 pm GMT+7
Military-run Viettel Group has 2 more deputy general directors
General Phan Van Giang, Minister of National Defence, has appointed Cao Anh Son and Nguyen Dat as deputy general directors of Military Industry and Telecommunications Group (Viettel Group), starting last Friday.
Companies - Mon, November 4, 2024 | 3:14 pm GMT+7