Dragon Capital buys back into real estate developer Khang Dien

Leading fund manager Dragon Capital bought back 1,050,000 KDH shares in real estate firm Khang Dien on Tuesday to raise its ownership from 10.96% to 11.1%.

In a reverse move, a fund group related to Dragon Capital sold 1,210,000 KDH shares on May 26.

In the first quarter of 2023, Khang Dien, listed on the Ho Chi Minh Stock Exchange as KDH, recorded revenue of VND425.31 billion ($18.07 million), up 198% year-on-year, and after-tax profit of VND201.07 billion ($8.5 million), down 32.9%.

KDH has targeted an after-tax profit of VND1 trillion ($42.64 million) in 2023, down 9.3% year-on-year on a revenue of VND3.1 trillion ($132.18 million), up 6.5%.

The firm plans to promote sales of the remaining townhouses and villas at The Classia development in Thu Duc city; build and trade the high-end apartment project The Privia in Binh Tan district (1,043 apartments on 1.8 hectares); and implement a villa and townhouse project named Clarita (5.8 hectares), and the Emeria project (6 hectares).

The company plans to seek shareholders' approval to pay more than VND716 billion ($30.53 million) in dividends for 2022 at a rate of 10% in cash and 10% in shares with an expected issue volume of more than 71.6 million shares.

After the issuance, the charter capital of KDH would increase from more than VND7.17 trillion ($305.64 million) to over VND7.89 trillion ($336.22 million).

KDH also plans to issue shares under the Employee Stock Ownership Plan (ESOP). The expected issue volume is 10.8 million units, accounting for 1.5% of total outstanding shares. The proposed issue price would be VND12,500 ($0.53) per share, nearly 43% lower than the market price.

The proceeds, estimated at VND135 billion ($5.76 million), would be used to supplement the company's business capital.

KDH plans to ask shareholders to cancel a plan to issue bonds to the public due to its financial and business restructuring. The company had planned to issue VND2 trillion ($85.28 million) in non-convertible bonds, without warrants or collateral. The bonds would have terms of 36 months, with an interest rate ranging from 9-10% per year.

At Friday's close, KDH shares hit VND30,700 ($1.3).

Khang Dien's apartment and villa projects include Safira Khang Dien (District 9, HCMC); Lovera Vista (Binh Chanh district, HCMC); Verosa Park (District 9, HCMC); Parcspring (District 2, HCMC); Topia Garden (Vung Tau town, Ba Ria-Vung Tau province); and Mega Village, Jamila Khang Dien, The Venica, Lucasta, Jamila Khang Dien, all in District 9, HCMC.