TTC Land issues bonds to cooperate in investing in new key projects

Investors poured more than $600 billion into global bond funds in early 2024, taking advantage of the highest yields in decades, making 2024 the “year of bonds.”

Investors poured more than $600 billion into global bond funds in early 2024, taking advantage of the highest yields in decades, making 2024 the “year of bonds.”

Not out of the wave, Saigon Thuong Tin Real Estate JSC - TTC Land (HoSE: SCR) has also just announced its policy of issuing cooperative bonds to invest in key projects.

As inflation has eased, central banks have been able to lower interest rates, spurring investment in bonds. In contrast to 2022, when $250 billion was withdrawn from bond funds, this year has seen strong growth. According to EPFR, as of mid-December 2024, about $617 billion had been invested in developed and emerging market bond funds, surpassing the $500 billion in 2021 and potentially making 2024 a record year.

Aiming to develop Vietnam's bond market

In recent years, the Vietnamese bond market, especially government bonds, has become an important capital mobilization channel for the Government, policy banks and enterprises. This is also a safe and effective form of investment.

According to the Ministry of Finance, the stock market development strategy until 2030 sets a target of bond market outstanding balance reaching at least 58% of GDP. To meet the large capital mobilization demand for key national projects, many domestic enterprises have quickly joined the wave of bond issuance.

Domestic enterprises race to issue bonds

VietJet Aviation Joint Stock Company (VJC) and Asia Commercial Joint Stock Bank (ACB) have announced plans to raise capital through bonds, with a total value of up to thousands of billions of VND. Similarly, many real estate enterprises such as Vinhomes Joint Stock Company have also quickly joined this wave.

Issuance value of some typical real estate enterprises according to market capitalization (Source: HNX, Vietcap. Unit: billion VND)

According to statistics from the Vietnam Bond Market Association (VBMA), in the first 11 months of 2024, Vietnamese enterprises issued nearly VND375,000 billion worth of bonds, of which nearly VND343,000 billion were individual bonds. Of which, the banking sector accounted for 72% of the issuance value, and the real estate sector accounted for 17% of the issuance value.

Issuance value by industry group, cumulative data for 11 months 2024. (Source: VBMA)

TTC Land joins the trend, issues investment bonds for new key projects in Phu Quoc

Phu Quoc City, also known as “Pearl Island”, is one of the top tourist destinations in Vietnam. With a combination of rich natural resources, strategic location and development policies, Phu Quoc has great potential for economic development, especially in areas such as tourism, resort real estate and international trade.

According to experts, the resort real estate segment in Vietnam in general and Phu Quoc in particular is predicted to have strong development potential in the next 2-3 years, thanks to the following factors: The recovery of international and domestic tourism, Phu Quoc is expected to welcome nearly 6 million visitors in 2024, surpassing the 5.1 million visitors mark before the Covid-19 pandemic. The number of international visitors is estimated at 962,000, an increase of more than 70% over the same period; Incentive policies and infrastructure development, aiming to become a type I urban area by 2025, especially Phu Quoc has been recognized as the first island city in Vietnam, conditions to attract large investment capital from both domestic and international sources, creating a solid foundation for the development of the resort real estate market; The demand for owning second-homes and resort real estate is increasing; The participation of large corporations in Phu Quoc. Furthermore, Phu Quoc possesses the potential advantage of long-term value increase because land still has room to increase in price due to limited supply, while demand is increasing.

According to forecasts, from the second quarter of 2025, the Phu Quoc resort real estate market will pass the turning point and flourish. Products such as land plots and project villas are expected to attract the attention of investors. At the same time, the application of specific policies, such as visa exemption for tourists for 30 days, will continue to promote tourism and create momentum for the Phu Quoc resort real estate market.

Seizing the potential development opportunities in Ngoc Island, TTC Land has just announced information on the bond issuance plan. The purpose of the issuance is to cooperate with Toan Hai Van Joint Stock Company to invest in the Vinh Dam Complex Project with a total investment of 3,579 billion VND, the product includes a resort complex combined with tourism and accommodation services in Phu Quoc city.

This move helps TTC Land diversify its business and shift its investment to less impacted sectors while waiting for the recovery of residential real estate . The value of the issued bonds is VND 850 billion, with a term of 60 months and a face value of VND 100 million/bond; the type of non-convertible bond, without warrants, and especially with a payment guarantee from the credit institution Orient Commercial Joint Stock Bank (OCB) is proof of safety and at the same time has the right to buy back before maturity.

The first year interest rate is 8.5%, good interest rate margin of 3.6% for each adjustment period, the issuance term is 5 years compared to 3 years for other companies in the same industry. In addition, this is a project with high development potential and profit, a strategic step to help the company increase revenue and profit in the future, enhance the company's position in the real estate market, and at the same time enhance the value of shares and brand.

Along with the successful capital increase from VND 3,957 billion to VND 4,306 billion through debt swap with 3 creditors, TTC Land implemented a thorough liquidity strategy, transferring assets and ineffective investment portfolios to create resources. The issuance of bonds to invest in key resort real estate projects in Phu Quoc marked an important step in the company's land fund diversification plan.

Currently, in addition to 163 hectares of civil land fund in Ho Chi Minh City and the southern provinces that are completing legal procedures, TTC Land is also expanding its industrial park land fund in the 2026-2030 strategy. In particular, the cooperation to develop a resort product line with reasonable prices in Phu Quoc in the next 2-3 years demonstrates the company's clear vision.

With the potential of resort real estate in the period of 2025-2027, TTC Land has chosen the "Pearl Island" Phu Quoc as the focus, specifically the Vinh Dam Complex project in cooperation with Toan Hai Van Joint Stock Company. This is considered a strategy to anticipate trends and optimize investment value in the resort sector.

Source: https://baodautu.vn/ttc-land-phat-hanh-trai-phieu-de-hop-tac-dau-tu-du-an-trong-diem-moi-d235764.html