Vinaconex shifts toward property, infrastructure under former CEO

Nguyen Xuan Dong has returned to Vinaconex as chairman after serving as CEO from late 2018 to April 2026, a period marked by multiple challenges including disputes with Sovico Group, the impact of the Covid-19 pandemic, and geopolitical tensions that drove up raw material costs.

Despite those headwinds, Vinaconex maintained large-scale revenue and gradually restructured its operations under Dong’s leadership. Between 2018 and 2025, the company’s revenue and net profit grew at average annual rates of nearly 12% and 74%, respectively.

Looking specifically at the construction segment, which remains Vinaconex’s main revenue contributor, gross profit margins peaked at 5.85% in 2021. Notably, the segment posted a negative gross margin of 2.93% in 2023 before recovering to 3.47% in 2024 and 3.71% in 2025.

Low construction margins are not unique to Vinaconex but are common among Vietnam’s large contractors due to intense competition. Builders often have to bid aggressively, particularly for infrastructure and state-funded projects, in order to secure contracts.

Vinaconex’s management has repeatedly said it does not expect outsized profitability from the construction business. Instead, the segment serves as a foundation that generates stable revenue streams, supports employment for the company’s large workforce, and preserves its position as a leading construction brand.

Financial results between 2018 and 2025 also showed profit spikes in 2020 and 2025, with 2025 marking the highest net profit in the company’s history. Both years coincided with major divestment transactions.

In 2020, Vinaconex recorded a sharp increase in profit after selling its 50% stake in An Khanh New Urban Development Joint Venture Co Ltd, the developer of the Splendora Bac An Khanh project, to Pacific Star Investment and Development JSC, an entity linked to Sovico Group.

Similarly, Vinaconex’s strong profit in 2025 came from the divestment of its entire stake in Vinaconex ITC (UPCoM: VCR), the developer of the Cat Ba Amatina project on Cat Ba Island in Hai Phong city. The project spans 172.37 hectares.

Following the divestment, Vinaconex ITC welcomed four new major shareholders holding a combined 94.18% stake, including Hanoi Anpha Real Estate Trading Floor Co Ltd, Imperia An Phu Co Ltd, Silver Field International Business Co Ltd and Khu Dong Phu Quoc Co Ltd. All are entities linked to MIK Group, one of Vietnam’s major property developers.

At December 31, 2025, Vinaconex had also extended short-term loans worth more than VND5.4 trillion ($205.15 million) to three entities linked to MIK Group, including Bien Dong Investment and Management Consulting Co Ltd with 2.4 trillion dong, Phu Thinh Phat Investment Co Ltd with 2.06 trillion dong and Duc Mai General Import Export Investment Co Ltd with 1 trillion dong.

The loans carried annual interest rates ranging from 9.6% to 12.5% and were secured by shares in a listed Vietnamese bank owned by a third party.

The transactions drew market attention because the scale of the loans was nearly equivalent to the value of Vinaconex’s divestment from Vinaconex ITC.

Property and wastewater treatment seen as new growth drivers

Real estate is expected to become Vinaconex’s core profit driver as the company pushes ahead with multiple projects.

As of the end of 2025, Vinaconex was developing seven residential, resort and industrial park projects, including the Capital One project in the Kim Van-Kim Lu urban area in Hanoi; the Vera Diamond City project in Quang Ninh province in partnership with Phuc Khanh; and a resort and hotel project in Ha Thanh eco-tourism area in Quang Nam province.

Other developments include the Vinaconex Diamond Tower project in Hanoi and two industrial infrastructure projects at Hoa Lac High-Tech Park and Dong Anh Industrial Park, both in Hanoi.

At the company’s 2026 annual general meeting, Dong said Vinaconex was studying a potential investment in Thuong Dinh Shoes JSC, which owns a prime real estate site at 277 Nguyen Trai street in Hanoi.

Vinaconex plans to acquire a 24% stake and cooperate with partners to develop the project. Previously, An Quy Hung Holding, an entity linked to Vinaconex, became a major shareholder in Thuong Dinh Shoes after acquiring a 24% stake.

Beyond real estate, Vinaconex is also expanding into wastewater treatment and environmental infrastructure.

As of April 20, 2026, Vinaconex held a 97.5% stake in Vietnam Water and Environment Investment Corporation, known as Viwaseen, which focuses on water supply and wastewater treatment.

At the 2026 shareholder meeting, Dong said Vietnam could begin implementing wastewater treatment fees through clean water pricing between late 2026 and 2027.

According to Dong, such a mechanism would mark an important turning point by creating stable cash flows for the industry and encouraging more private-sector participation. Vinaconex is preparing to capitalize on that trend.

After nearly a decade under Dong’s leadership as CEO, Vinaconex appears to be transitioning from a traditional construction contractor into a diversified investment group focused on real estate, industrial parks and environmental infrastructure.

However, the company’s biggest challenge remains its ability to generate sustainable earnings growth from core operations rather than relying on large-scale divestment deals.