Targeted profit increase of 7.4 times in 2022 but first quarter profit decreased by 80%
In early 2023, Hoang Quan Real Estate (HQC) set a relatively ambitious target with planned revenue of 1,700 billion VND. Of which, real estate revenue accounted for 650 billion VND, real estate investment cooperation revenue accounted for 1,050 billion VND.
In terms of profit, the company expects its after-tax profit to reach VND140 billion, 7.4 times higher than that achieved in 2022.
Hoang Quan Real Estate (HQC) first quarter profit decreased by 80%, still planning to sell shares at double the market price to raise an additional 1,000 billion VND. (Photo TL)
Explaining this ambitious goal, Hoang Quan Real Estate said that 2023 will be an opportunity for the company because in 2022, the Ministry of Construction completed its task and submitted to the Government the Investment Project to build at least 1 million social housing apartments for low-income people and industrial park workers in the period 2021-2030.
However, the company’s first quarter business results showed an extremely bleak picture. Net revenue was only VND39 billion, down 39% compared to the same period. After-tax profit was only VND1 billion, down 80%.
Compared with the revenue and profit targets set for 2023, by the end of the first quarter, Hoang Quan Real Estate had only completed 2.3% of the revenue plan and about 0.7% of the annual profit plan.
Bright 2023 outlook pushes stock prices up, HQC chairman's wife quickly sells out 18.2 million shares
At the beginning of 2023, HQC stock code was only traded around 2,700 VND/share, down nearly half compared to the peak period reached in August 2022. This is also understandable when the 2022 business results of Hoang Quan Real Estate only recorded revenue of 276 billion VND, after-tax profit of 19 billion VND, equivalent to the completion rate of 25.4% and 11.5% of the plan set at the beginning of the year.
Despite such poor business results in 2022, HQC's board of directors is still confident in setting a profit target of 7.4 times higher for 2023. Coincidentally, HQC's stock price has also started to increase since the beginning of 2023. Up to now, in the trading session on June 21, 2023, HQC is trading around VND 4,500/share, which is an increase of 67% compared to the beginning of the year.
Another noteworthy thing is that right when the stock price increased sharply, the wife of Mr. Truong Anh Tuan - Chairman of the Board of Directors of Hoang Quan Real Estate, Ms. Nguyen Thi Dieu Phuong registered to sell 18.2 million HQC shares that she held.
The transaction was matched from May 25, 2023 to June 1, 2023. After this transaction, Ms. Phuong sold almost all of her shares and only symbolically held the remaining 6 HQC shares. The average price during the period when Ms. Phuong traded was VND 4,650/share. Thus, Ms. Phuong earned about VND 85 billion.
Stocks are still "sinking" below 5,000 VND/share, what basis does Hoang Quan Real Estate have to mobilize an additional 1,000 billion VND?
Although HQC's share price increased by 67% in the first half of 2023, it is still "drowning" below the threshold of VND 5,000/share. However, on May 19, 2023, Hoang Quan Real Estate was still confident in approving the plan to offer 100 million individual shares at VND 10,000/share to raise VND 1,000 billion.
Regarding the plan to use capital, Hoang Quan Real Estate plans to use 400 billion VND to receive shares transferred from existing shareholders of Golden City Investment JSC and 600 billion VND to buy shares in the private offering of Golden City Investment JSC.
Golden City Investment JSC is the investor of the Golden City Project with a scale of 3.35 hectares and an investment capital of up to VND 1,776.6 billion. Mr. Truong Anh Tuan, Chairman of the Board of Directors of Hoang Quan Real Estate, also owns 50% of the charter capital and has also been the legal representative of this company since its establishment. In May 2022, the company changed its legal representative to Mr. Nguyen Thanh Van.
The above stock issuance plan was approved at the 2022 General Meeting of Shareholders and the disbursement plan was approved in the third and fourth quarters of 2023. However, what many investors are concerned about is that the current HQC stock price is still below VND 5,000/share, so what is the basis for the company to offer individual shares at a price more than double the current market price. Not to mention that the privately offered shares will be restricted from transfer for 1 year?
Source
Comment (0)