In the first month of 2024, there were almost no corporate bond issuances. According to records, there was only one listed enterprise offering to the public and one enterprise issuing privately. Notably, among them was a batch of corporate bonds issued with sky-high interest rates.
There is a batch of corporate bonds issued in the first month of 2024 with sky-high interest rates.
Specifically, Ho Chi Minh City Infrastructure Investment Joint Stock Company (stock code CII) has just reported the results of its public bond offering that ended on January 25. The total number of bonds distributed was 28.13 million, accounting for 99.05% of the offering (28.4 million bonds). After deducting expenses, CII earned a net of VND2,812 billion. Of which, CII's employees alone (including the company's leaders and employees) spent VND1,120 billion (meaning the bond interest rate will be 2.5% higher than the reference interest rate per year). The reference interest rate is the average 12-month deposit interest rate of two banks, Vietcombank and Vietinbank, to buy bonds issued by the company.
The expected time for bond delivery is from February to March. This is a type of bond that is convertible into common shares, unsecured, without warrants. The bond can be converted into common shares every 12 months, the conversion ratio is 1:10, meaning each bond is converted into 10 common shares.
The bond term is 10 years, the interest rate is a combination of fixed and floating interest rates, interest is paid every 3 months. For the first 4 interest periods, the fixed interest rate is 10%/year. For the following interest periods, the floating interest rate is the sum of 2.5%/year and the reference interest rate of that interest period (average 12-month deposit interest rate of two banks Vietcombank and Vietinbank). This means that the bond interest rate will be 2.5%/year higher than the reference interest rate.
Notably, White Castle Joint Stock Company (headquartered in Vung Tau City) announced that it had successfully issued a batch of bonds on January 22. What makes this batch of corporate bonds special is the interest rate of up to 14.5%/year, much higher than the market average.
Bond code LDTCH2326001 has a term of 35 months, offered to individuals and professional organizations with a volume of only 25 bonds, par value of 100 million VND, equivalent to a value of 2.5 billion VND. This is a very low mobilization value compared to successful bond issuances.
On the other hand, it is estimated that early bond repurchase activities are still taking place regularly, with businesses having repurchased nearly VND4,300 billion worth of bonds.
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