Vingroup issues 10,000 billion VND in bonds

Vingroup is about to issue 10,000 billion VND in bonds to the public to lend to VinFast to invest in an automobile manufacturing project in Dinh Vu - Cat Hai Economic Zone, Hai Phong.

Public issuance has stricter conditions than private issuance. The amount of VND10,000 billion announced by Vingroup (VIC) includes VND6,000 billion for a 36-month term and VND4,000 billion for a 24-month term.

This is a non-convertible bond, without warrants, without collateral and establishing a direct debt obligation with Vingroup. The face value of each bond is 100,000 VND.

In particular, individual investors must register to buy at least 500 bonds, equivalent to 50 million VND. Institutional investors must buy at least 5,000 bonds, equivalent to 500 million VND at par value.

The interest rate for the 36-month bond lot (VND6,000 billion) is 15% per annum for the first two interest periods, after which the floating interest rate is the reference interest rate plus 4.5%. For the 24-month bond lot (VND4,000 billion), the interest rate for the first two periods is 14.5% and then the floating interest rate is the reference interest rate plus 4%.

According to Vingroup, the purpose of this issuance is to lend to VinFast - the group's manufacturing subsidiary - to invest in an automobile manufacturing project in Dinh Vu - Cat Hai Economic Zone, Hai Phong.

VinFast was established in 2017, a member of Vingroup Corporation (VIC) with the vision of becoming a smart electric vehicle brand promoting the global electric vehicle revolution.

After 6 years of establishment, the company has developed an electric vehicle ecosystem including electric SUV lines (from minicars to 5 basic ABCDE segments) and a diverse range of electric motorbikes including 7 lines and electric buses.

The company has delivered electric cars to customers in Vietnam, including the VF e34, VF 8, VF 9 and VF 5, and exported the first two batches of VF 8 cars to North America earlier this year. VinFast electric cars are expected to soon be available in Europe as well.

The company recently announced that the filing related to the business combination transaction with Black Space (a company funded by Black Spade Capital - which operates a portfolio of cross-border investments) has been announced effective by the US Securities and Exchange Commission. VinFast is expected to list on the US market as early as August.

By the end of the second quarter, Vingroup's total assets reached nearly VND608,000 billion, a slight increase compared to the end of the first quarter. In the last three months, the group has mobilized and disbursed more than VND22,400 billion, including syndicated loans totaling USD430 million from the international capital market and paid VND20,000 billion of debts due during the period.

In the first two quarters of this year, the group recorded total consolidated net revenue, including real estate transfer revenue recorded in financial income, reaching VND102,530 billion, more than double the same period last year, mainly thanks to the handover of low-rise real estate at the Vinhomes Ocean Park 2 project.

Other sectors including real estate investment, hotel services, tourism, entertainment and manufacturing all grew. In particular, manufacturing revenue in the first 6 months of the year increased by 55% thanks to a sharp increase in electric vehicle sales, 5 times higher than the same period last year.

Vingroup's consolidated pre-tax profit in the first half of the year reached VND7,936 billion, more than double the same period in 2022 and the highest level since the group was listed on the stock exchange.

Minh Son

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