Why does VEC need to increase its charter capital to more than 38,000 billion VND?

Investing additional charter capital for the parent company - VEC is necessary and urgent to help VEC have access to capital sources and conditions to invest in expansion projects and new projects.

Regarding the proposal to increase additional charter capital for the 2024-2026 period of the parent company, Vietnam Expressway Corporation (VEC) said that in the 3-year period (2021, 2022, 2023), the total revenue of the unit is more than 20,556 billion VND.

In recent times, low charter capital has negatively impacted VEC's production and business activities and access to credit from credit institutions and financial institutions (Photo: Ben Luc - Long Thanh Expressway invested by VEC).

Of which, net revenue reached over VND 12,000 billion, financial revenue reached nearly VND 5,300 billion, other revenue reached over VND 3,251 billion. Total pre-tax profit reached over VND 3,469 billion; State budget contribution reached over VND 2,000 billion.

VEC's production and business results, debt repayment ability and financial structure have changed positively with the enterprise ranking for 3 years 2021, 2022, 2023 reaching type A.

However, according to VEC, currently, the charter capital of the parent company - VEC is very low, only 1,115 billion VND compared to the investment scale of about 108,865 billion VND.

Therefore, VEC has difficulty mobilizing capital sources to invest in expressway projects, especially for capital sources with low capital costs such as commercial loans, issuance of project bonds, ensuring the completion of the 5-year production, business and investment development plan for the period 2021-2025, Development Strategy to 2030, vision to 2035.

Also according to VEC, as the State representative as the investor of expressway projects, VEC has initially completed the goal of serving the strategy of developing the national expressway network by mobilizing about 108,865 billion VND from domestic and foreign capital sources to invest in 5 expressway routes with a length of 540km.

The expressways invested and put into operation by VEC have played a role in the country's socio-economic development.

On the other hand, with the role of managing, operating and exploiting expressways assigned by the State, VEC has put into operation 490 km of 4/5 expressway projects, accounting for about 27% of the total length of expressways in Vietnam today.

"The investment in additional charter capital for the parent company - VEC is necessary and urgent, in accordance with the policies/tasks assigned by the Central Party, National Assembly, and Government, ensuring the completion of the enterprise's development plan and strategy.

This is also the basis and motivation for VEC to be able to access capital sources and conditions to invest in expansion projects and new projects, contributing to the driving force to promote development for localities where the projects pass through, helping VEC develop in depth, bringing products with the best service quality to customers," VEC affirmed.

Based on the analysis, VEC proposed that the Government report to the National Assembly to approve the investment policy to supplement the charter capital for the parent company - VEC in the period of 2024-2026 at VND 38,251 billion.

This capital includes: 1,562 billion VND from the Enterprise Development Investment Fund, 36,689 billion VND from the state budget (public investment capital has been assigned to the Ministry of Transport to invest in 5 expressway projects invested by VEC and has been disbursed).

Previously, in January 2025, on behalf of the Prime Minister, Minister of Finance Nguyen Van Thang signed and sent a document requesting the Chairman of the National Assembly and the Standing Committee of the National Assembly to consider adding to the agenda of the 9th extraordinary session of the 15th National Assembly the policy of supplementing charter capital for the 2024-2026 period for VEC.

On the afternoon of February 10, 2025, the National Assembly Standing Committee met to give opinions on this issue.

Source: https://www.baogiaothong.vn/vi-sao-vec-can-tang-von-dieu-le-len-hon-38000-ty-dong-192250210190653543.htm