The strange story continues

Capital shortage of 25%, nearly 30% of businesses change owners

Hai Phat Investment JSC - Hai Phat Invest (HPX) of Chairman Do Quy Hai continues to record unusual developments in transactions after its shares are about to be put on the trading suspension list.

In the session on September 14, Hai Phat Investment witnessed a sudden transaction with the order matching volume reaching more than 83 million units, the transaction value of 456 billion VND. With 304 million listed shares, the total transaction volume in the session on September 14 accounted for more than 27% of the shares of this real estate company.

Although the demand for this stock at the bottom was very high, the overwhelming selling pressure caused HPX shares to still hit the floor price at the end of the session on September 14, down to 5,480 VND/share, with a surplus of more than 12.6 million units sold at the floor price.

The selling pressure on Hai Phat Invest shares since September 11 has caused this stock to hit the floor for four consecutive sessions in the context of HPX receiving a decision to suspend trading from the Ho Chi Minh City Stock Exchange (HOSE), effective from September 18.

In just 4 sessions this week, HPX shares have dropped 25%. Capitalization has also evaporated accordingly.

Thus, the selling pressure and bottom-fishing demand occurred right before HPX was suspended from trading due to continuous violations of information disclosure obligations. The sluggish real estate market and the debt burden caused HPX's business to decline. HPX was continuously warned by HOSE and put on warning and then under control due to late submission of audited financial reports.

This is the second time Hai Phat Invest has witnessed such a large transaction.

Previously, on November 30, 2022, Hai Phat Invest recorded more than 146.5 million shares, equivalent to nearly 50% of shares transferred in one morning. At that time, HPX shares hit the ceiling after 12 consecutive floor-falling sessions.

At that time, Hai Phat Invest was considered the third real estate stock to be "rescued" after Novaland (NVL) of Chairman Bui Thanh Nhon and Phat Dat Real Estate (PDR) turned around and increased again after 17-18 sessions of floor price decline.

Hai Phat Invest is known as a real estate giant in the North, emerging over the past years. However, like many other real estate businesses, HPX fell into a state of illiquidity when the real estate market was sluggish for a long time and the bond market was in crisis after the events of Tan Hoang Minh and Van Thinh Phat.

Like Novaland Chairman Bui Thanh Nhon, HPX Chairman Do Quy Hai has had tens of millions of HPX shares mortgaged for a long time, reducing the ratio from over 40% (about more than 120 million shares) to over 14% as at present. HPX shares have decreased from over 26,000 VND/share at the end of October 2022 to about 4,000 VND/share at times.

*Many real estate businesses are still facing difficulties in business operations.*

In August and early September 2023, HPX shares increased sharply again thanks to expectations that real estate businesses had hit bottom and would overcome difficulties. However, the financial situation of the business is still unclear as the audited financial report has not been released.

Real estate stocks fall across the board, are there still many difficulties?

In the trading session on September 14, many real estate stocks fell sharply. Novaland (NVL) fell 1,250 VND to 18,700 VND/share. Phat Dat Real Estate (PDR) fell 850 VND to 25,400 VND/share. DIC Corp. (DIG) fell 1,100 VND to 27,300 VND/share... Vingroup (VIC) fell 3,700 VND to 55,500 VND/share; Vinhomes (VHM) fell 3,100 VND to 49,000 VND/share; Vincom Retail (VRE) fell 100 VND, trading at 28,900 VND/share.

The group of real estate stocks is under strong downward pressure following signs of slow recovery in the real estate market as well as the general downward trend in the stock market due to profit-taking pressure and concerns about the high USD/VND exchange rate, strong net selling by foreign investors and possible weak business results in the third quarter of 2023. In the session on September 14, the VN-Index decreased by 14.58 points (equivalent to a decrease of 1.18%) to 1,223.81 points.

Recently, the Government has introduced many fiscal and monetary policies to support the economy to grow strongly again, especially in the real estate sector.

After the regular Government meeting in August 2023, the Government has just issued Resolution 144/NQ-CP, which includes an important content requiring the State Bank of Vietnam (SBV) to review and adjust the risk coefficients of different real estate segments.

Resolution 144 also requires reviewing regulations related to lending and investing in corporate bonds to ensure consistency and compliance with the policy of developing the corporate bond market.

Source