From property broker to developer: Is Khai Hoan Land Group ready?

Khai Hoan Land Group (HoSE: KHG) has set relatively ambitious targets for 2026, aiming for net revenue of VND1.25 trillion ($47.48 million) and net profit of VND123 billion ($4.67 million), roughly doubling year-on-year, as it seeks to transition from a brokerage-focused model to a property developer.

Reshaping the direction of development

Revenue from real estate brokerage remains KHG’s core business, contributing about VND480 billion ($18.23 million) out of total revenue of VND601 billion in 2025, a sharp increase from VND144 billion in 2024.

However, despite strong top-line growth, profit improved only modestly, indicating margin compression amid intensifying competition in the brokerage sector.

Notably, escrow assets - primarily supporting project distribution activities - reached nearly VND1 trillion ($37.98 million), underscoring the scale and operational efficiency of its brokerage segment. The company’s shift toward development therefore appears to be a medium- to long-term strategy.

Addressing shareholder concerns over the strategic pivot at the company's AGM in Ho Chi Minh City on Tuesday, Pham Minh Phu, board member and deputy CEO, said that after years of cooperation with major developers, KHG has accumulated sufficient experience and resources to undertake its own projects to improve profit margins.

The company plans to launch around 4,000 units this year and a total of 20,000 units over the next three years.

Meanwhile, Deputy CEO Tran Van Duong said only the Khai Hoan Prime project (located on Le Van Luong street in the former Nha Be district, adjacent to Phu My Hung urban area) has completed legal procedures and is eligible for sales contracts.

Revenue contribution from the project remains limited, however, as its three towers are still under structural construction, with stronger revenue recognition expected once finishing works begin toward the end of 2026.

Against this backdrop, management has set its 2026 targets at VND1.25 trillion (VND47.48 million) in net revenue and VND123 billion ($4.67 million) in net profit, roughly doubling year-on-year.

Market headwinds and funding plans

Company executives said the lack of a strong recovery in the real estate market has weighed on growth momentum. As a result, KHG will not pay dividends this year in order to prioritize resources for project development.

According to its 2025 financial statements, a significant portion of KHG’s assets is tied up in receivables related to business cooperation contracts (BCCs) with five partners across eight projects, totaling nearly VND4.6 trillion ($174.7 million).

Besides Khai Hoan Prime, which has completed legal procedures, the company said a project in Thuan Giao ward, Ho Chi Minh City, is expected to complete legal formalities this year. The project is scheduled for a three-year development period, with handover expected in the fourth quarter of 2028.

To support its expansion plans, shareholders have approved a private placement of up to 80 million shares at a minimum price of VND10,000 ($0.38) per share, aiming to raise VND800 billion ($30.38 million).

Of the proceeds, around VND300 billion will be used to invest in Hoang Thao My Trading and Services Co Ltd to develop the Thuan Giao project in HCMC, the company said.

On the Ho Chi Minh Stock Exchange, KHG shares closed Tuesday at VND5,600 ($0.21) apiece.