Property giant Vinhomes targets $1.4 bln net profit in 2024

Vinhomes JSC, the real estate arm of Vietnamese private conglomerate Vingroup, is aiming to earn VND120 trillion ($4.78 billion) in revenue and VND35 trillion ($1.4 billion) in net profit this year, up 16% and over 4% respectively compared to 2023.

In documents to be submitted to the annual general meeting (AGM) of shareholders scheduled for April 24, the board of directors said it plans to allocate VND5 billion ($199.4 million) from 2023 after-tax profit to the reserve fund in line with company regulations. The remainder will be used to invest in production and business.

The firm will not pay 2023 dividends for the second consecutive year, it added.

In 2023, Vinhomes' total consolidated net revenue reached VND103.5 trillion ($4.13 billion), an increase of 66% compared to 2022. Of which, revenue from real estate transfer activities continued to be the core, hitting VND89.67 trillion ($3.58 billion) thanks to the on-schedule handover of major projects such as Vinhomes Ocean Park 1 and Vinhomes Smart City in Hanoi and Vinhomes Ocean Park 2 and 3 in neighboring Hung Yen province.

After deducting expenses and taxes, the company's net profit last year was VND33.53 trillion ($1.34 billion), 12% higher than the plan approved at the 2023 AGM.

Vinhomes said it has launched Vinhomes Sky Park in Bac Giang province and Vinhomes Golden Avenue in Mong Cai town, Quang Ninh province. In addition, the company has announced planning for Ocean City in the east of Hanoi, including Vinhomes Ocean Park 1, 2 and 3, with a total area of nearly 1,200 hectares.

According to broker VietCap Securities, Vinhomes holds favorable conditions for growth in the residential real estate segment in Vietnam in the long term thanks to its leading position, large land bank, and experience in developing large-scale projects.

VietCap forecast that Vinhomes' 2024 profit after tax and minority interests (PATMI) will reach VND29.3 trillion ($1.07 billion), down 12% compared to 2023, mainly thanks to the expected handovers of Ocean Park 2 and 3 (accounting for about 70% of core real estate revenue forecast in 2024) and new sales expected at the Vu Yen project in the northern city of Hai Phong.

The PATMI is forecast to decrease because Vinhomes is expected to record lower wholesale sales than in 2023.

In its 2024-2025 forecast, VietCap expects homebuyer confidence to continue improving, brokerage activities to flourish, and legal procedures to be further simplified, which will support Vinhomes as it launches new projects while continuing to maintain its wholesale strategy for upcoming projects.

The broker projected that Vinhomes’ total sales contract value for the 2024-2025 period will hit VND158 trillion ($6.3 billion), supported by forecast sales from ongoing projects and expected new projects, including Vu Yen in Hai Phong, Wonder Park in Hung Yen, and Co Loa in Hanoi.

Vinhomes is listed on the Ho Chi Minh Stock Exchange as VHM, and closed Wednesday at VND43,100 ($1.72) per share.