Realty player Phat Dat aims for capital base, profit increases in 2024

Phat Dat Real Estate Development Corp, a major property developer in Vietnam, is aiming to raise its charter capital by 15% to VND10.52 trillion ($413.2 million) this year.

To realize the target, the firm, listed on the Ho Chi Minh Stock Exchange as PDR, is offering 134 million shares through a rights issue at a price of VND10,000 ($0.39) apiece.

The proceeds, estimated at VND1.34 trillion ($52.7 million), have been earmarked for the development of the Thuan An 1 and Thuan An 2 residential complexes in the southern province of Binh Duong.

Additionally, funds will support urban subdivisions No. 2 and 9 at the Nhon Hoi ecotourism urban project, the Bac Ha Thanh residential project, and the Cadia Quy Nhon apartment complex, all located in the south-central province of Binh Dinh.

In addition, Phat Dat Real Estate will issue another 313.6 million shares, including 14.6 million shares under the employee stock ownership plan (ESOP), at VND12,000 ($0.47) apiece, and 131 million shares distributed from retained earnings.

The firm also has a $30 million loan from ACA Vietnam Real Estate III LP, disbursed in 2022. The loan can be converted into 34 million common shares from the outstanding principal at a price of VND20,000 ($0.79) apiece.

Before the expected growth in Phat Dat Real Estate’s capital base, its chairman Nguyen Van Dat bought up an additional 51.5 million shares from May 21 to June 5 to maintain his ownership at 38.84%, increasing his total shares from 283.2 million to 334.7 million.

Similarly, Phat Dat Holdings Company Limited, founded by Dat, has acquired 12.3 million to keep its ownership at 9.15%, lifting its total shares from 67.6 million to 79.9 million.

Once the share offerings are completed, Dat and Phat Dat Holdings are projected to spend VND638 billion ($25.05 million) to maintain their 47.5% ownership after the increase in charter capital.

This year, the firm targets VND2.98 trillion ($117.08 million) in revenue, down 6% year-over-year, and VND880 billion in net profit, up 29%. In the first quarter of 2024, the company posted VND161 billion ($6.32 million) in revenue and VND53 billion ($2.08 million) in net profit.

Phat Dat Real Estate aims to complete four projects in the first half of 2024, namely Thuan An, Cadia Quy Nhon, Bac Ha Thanh, and the Poulo Condor hotel in Con Dao island off the southern province of Ba Ria-Vung Tau, and begin sales in late Q2.

As of end-2023, the firm had a land fund of 4,266 hectares, comprising 3,113 ha in the central province of Quang Ngai, and at least six projects qualified to be put on the market, with a combined expected revenue of VND40 trillion ($1.57 billion).

As of end-March, Phat Dat Real Estate had liabilities of VND3.45 trillion ($139.07 million), of which VND385 billion ($15.12 million) was guaranteed by 30.7 million PDR shares.

The firm was pursuing a multi-industry model but divested a 99.8% stake in Phat Dat Industrial Park Investment and Development JSC for VND415 billion ($16.29 million). Additionally, it transferred part of its equity in Phatdat Realty last year due to financial issues. Since then, the company has focused on real estate development.

It had stepped into several projects to develop a sports center in Ho Chi Minh City, a hospital for traumatology and orthopedics in HCMC’s Binh Chanh district, and build-transfer transport infrastructure in the city. However, all of them have come to nothing.

PDR shares opened Friday at VND26,150 ($1.03) apiece.