Enterprises promote capital mobilization through stock exchanges
In the context of the real estate market preparing to enter a new phase, many businesses are also planning and implementing capital mobilization worth tens of thousands of billions of VND through the stock exchange. The capital mobilization goal is mostly to restructure debt, buy and sell or invest in projects to prepare resources to enter the new game.
Novaland Group (stock code: NVL) plans to offer shares at VND10,000/unit to raise more than VND11,700 billion. The expected implementation time is from the second quarter to the fourth quarter of this year.
With the mobilized amount, the group plans to use nearly VND10,600 billion to contribute capital to subsidiaries; more than VND855 billion to restructure debt and pay part of payables; more than VND140 billion to pay salaries for staff; and nearly VND139 billion to pay general operating costs.
Many real estate businesses are stepping up capital mobilization through the stock exchange (Illustration photo: Trinh Nguyen).
Becamex IDC Corporation (stock code: BCM) approved the issuance of 300 million shares through auction, raising at least VND15,000 billion.
The purpose of the capital increase is to use 6,300 billion VND to invest in projects, 3,634 billion VND to contribute capital to existing members; 5,066 billion VND to restructure finances. In particular, the company will focus on developing a number of projects such as Bau Bang Industrial Park, Cay Truong Industrial Park expansion...
Another company that also plans to raise thousands of billions of VND from stocks is Danh Khoi Group Joint Stock Company (stock code: NRC). This company wants to raise 1,000 billion VND from private offerings, planning to use 520 billion VND to pay off tax debts, bond debts and debts at BIDV; buy part of the project in Dai Nam Residential Area (Binh Phuoc) and Ham Thang - Ham Liem Residential Area (Binh Thuan).
Some other real estate businesses such as Dat Xanh Group (stock code: DXG), Phat Dat Real Estate Development Company (stock code: PDR) also raised money from issuing shares.
In particular, Phat Dat has just completed the issuance, collecting 1,343 billion VND, expected to implement the company's real estate projects such as Sub-areas 2 and 9 of Nhon Hoi Eco-tourism Urban Area (Binh Dinh), Bac Ha Thanh project (Binh Dinh), 2 housing projects Thuan An 1 and 2 (Binh Duong).
Dat Xanh Group wants to carry out 2 issuances: offering more than 150 million shares to existing shareholders at a minimum price of VND12,000/unit and 93.5 million shares to professional securities investors at a minimum price of VND18,600/unit. The total amount of money raised is at least about VND3,541 billion, which the company will use to contribute capital and increase ownership ratio at subsidiaries; pay off bond debt, subsidiary debt and supplement working capital.
Despite trying, it's still difficult.
To convince investors to "put money" in capital mobilization rounds, the company has also tried to achieve good business results in 2023 and improve the current situation. Novaland Group in 2023 achieved nearly 486 billion VND in profit after tax, reducing about 7,156 billion VND in debt compared to the previous year.
Novaland continues to resolve legal issues in projects, such as the Aqua City project in Dong Nai, or the implementation of two projects in Binh Thuan and Ba Ria - Vung Tau is also underway.
For Phat Dat Company, after overcoming the prolonged crisis and paying off all bond debt, the company plans this year to have revenue of VND 2,982 billion and after-tax profit of VND 880 billion, respectively 5 times and 29% higher than last year. To implement the strategy, this year, the company will promote product distribution in projects in Binh Duong, Binh Dinh, Con Dao, etc.
Mr. Luong Tri Thin - Chairman of Dat Xanh - expects the real estate market this year to flourish and change positively in 2025. The company is accelerating the completion of legal procedures for 8 large-scale projects, especially focusing on the Southern region...
This year, the company aims to increase net revenue by 5% and profit after tax for parent company shareholders by 31%, reaching VND3,900 billion and VND226 billion, respectively. In the medium and long term, the company aims to buy and accumulate real estate projects with good locations, complete premises, clear legal status; and complete procedures.
Many businesses are trying to escape difficulties and improve their business situation before issuing new shares to increase capital (Illustration: Trinh Nguyen).
According to a report by MB Securities Company (MBS), raising capital on the stock exchange will be one of the outstanding activities in the second half of this year for real estate companies to restructure debt, meet financial obligations regarding land to the state and increase project development costs.
However, this unit also recognized that the financial health of many real estate businesses is still weak and they have not accessed capital sources, and project development costs are increasing.
The ability to successfully raise capital for businesses is also a matter of concern for many investors. At a recent meeting of Danh Khoi Group, many shareholders questioned the board of directors about whether the issuance was successful or not, when the offering price of shares (VND10,000/unit) was much higher than the current trading price on the stock exchange (about VND4,700/unit).
Mr. Le Thong Nhat - Chairman of the Board of Directors - said that the Board of Directors (BOD) and the Executive Board had prepared for this issuance plan 12 months in advance, so they were quite confident about the results. Although he could not reveal the specific list of participating investors, he said that up to now, the offering plan has achieved more than 40%.
Another issue is the arrangement of funds to fulfill financial obligations of bonds. According to the May report of the Vietnam Bond Market Association (VBMA), in the remaining 7 months of this year, about 69,627 billion VND of real estate bonds will mature, accounting for nearly 43% of the entire market.
While the real estate industry is almost absent from the new bond issuance market, many businesses are slow in paying principal and interest to bondholders. Some opinions say that the debt repayment capacity of businesses in this industry is still weak, and the pressure on bonds will remain high this year and next year.
Therefore, businesses seem to be stuck between the two ends of balancing incoming and outgoing capital, how to retain cash flow to develop projects, maintain operations, and improve financial capacity.
Source: https://dantri.com.vn/bat-dong-san/nhieu-ong-lon-bat-dong-san-tim-duong-giai-toa-con-khat-von-20240628102721209.htm
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