Construction began on a series of important power transmission projects worth a total investment of VND1.3 trillion in various provinces, on December 25.

They were the Binh Long (Binh Phuoc province) – Tay Ninh 220kV transmission line, the Nha Trang (Khanh Hoa province) – Thap Cham (Ninh Thuan) 220kV transmission line and Quang Chau 220 kV transformer substation in Bac Giang province.

The Binh Long – Tay Ninh 220kV line, with investment of nearly VND644 billion, is expected to prevent the overload of the Binh Long – My Phuoc 220kV and Cu Chi – Trang Bang 220kV transmission lines.

The Nha Trang – Thap Cham 220kV line has a total investment of more than VND407 billion. Once completed, the project will contribute to meeting the increasing demand of high load in Khanh Hoa province.

The line will also create a 220kV circuit linking the central coastal localities, as well as increase the reliability of power supply in the region.

Meanwhile, the 220kV Quang Chau substation is located in Trung Dong village, Van Trung commune, Viet Yen district, Bac Giang province. The over VND250 billion project is expected to meet the high demand of additional charge, ensure power supply and reduce power losses on the grid in both Bac Giang and Bac Ninh provinces.

All projects were invested in by the National Power Transmission Corporation, under Vietnam Electricity (EVNNPT), using ODA loans and the corporation’s own capital.

On behalf of EVNNPT, the Management Board of Central Power Projects (AMT) is managing the projects which are expected to be completed in 2019.

Plan on building special administrative-economic zone in Khanh Hoa discussed

Politburo member and Deputy Prime Minister Truong Hoa Binh held a working session with the central province of Khanh Hoa on building the Special Administrative-Economic Zone (SAEZ) in Bac Van Phong (Northern Van Phong) on December 25.

At the meeting, Deputy PM Truong Hoa Binh and the leaders of the ministries and sectors that supported Khanh Hoa province on its proposal to establish the SAEZ in Northern Van Phong.

The Deputy PM asked Khanh Hoa to actively complete the plan, while directing the relevant ministries and sectors to coordinate with Khanh Hoa in order to finalise the plan and submit it to the Prime Minister for consideration.

He also asked the provincial authorities to clarify the scale and organisation of the administration needed for the Bac Van Phong SAEZ so that it will suit the zone’s development orientations.

The Van Phong Economic Zone covers an area of 150,000ha, including 70,000ha of land and 80,000ha of water surface, in Van Ninh district and Ninh Hoa township. It is a multi-sectorial economic zone with a design focused on container and petroleum transit services, oil refining, and petrochemistry.

The Bac Van Phong SAEZ will be located in the north of the Van Phong Economic Zone and have an expected area of around 66,000 hectares.

Agricultural insurance guarantees productivity

Vietnam is an agricultural country that not only meets the needs of its 95 million people but also exports to over 180 countries, with export value in 2016 of $32.14 billion and an estimated $36 billion this year, the “Agricultural Insurance: Identifying Challenges, Promoting Growth” forum organized by the Business Forum newspaper on December 21 heard. This is a remarkable achievement, reflecting the efforts of the entire agricultural sector and the Party and the State.

However, agriculture constantly faces major risks from natural disasters and epidemics. Moreover, Vietnam’s agriculture sector still features traditional agriculture and commodity agriculture, making it unable to promote its strengths.

The agricultural insurance sector has been operating soundly since 2011, with mechanisms and policies issued, but still bears many difficulties and limitations.

Therefore, in addition to policy efforts, the State, entrepreneurs, insurers, and farmers need to work together to make the agricultural industry become more and more productive and bring high value added.

Speaking at the opening of the forum, Mr. Hoang Quang Phong, Vice President of the Vietnam Chamber of Commerce and Industry (VCCI), said that agricultural insurance is a traditional insurance product among more than 500 current non-life products in the global insurance market, including more than 250 property insurance products, nearly 200 personal insurance products, and approximately 100 liability insurance products.

“Vietnam is an agricultural country, but annually, natural disasters and epidemics rob its GDP of an estimated 1.5 per cent,” he said. “Farmers need a guarantee for their labor and productivity, and agricultural insurance is the best hope.”

Although the government as well as the agricultural sector has a policy of inviting businesses to increase their investment, the proportion of investment in agriculture remains modest. One important reason is that investing in agriculture brings low profit but high risks.

According to figures provided by the Ministry of Agriculture and Rural Development, the number of enterprises investing in agricultural production accounts for less than 1 per cent of all enterprises in Vietnam and most are of small size. Enterprises with capital of less than VND5 billion ($220,068) account for 55 per cent of the total.

In addition, very few businesses invest professionally in agriculture. Most rely on the exploitation of natural resources such as land and water and have not paid sufficient attention to in-depth investment, the application of science and technology, or investments in modern equipment to increase production and export value. Meanwhile, links between enterprises and scientists and farmers in the production value chain have not been tight, leading to high costs, low competitiveness, and low efficiency.

MWG targets $3.8bn in 2018 revenue

The Mobile World Investment JSC (MWG) announced the company’s business plan for 2018, with total revenue and after-tax profit targeted to reach VND86.4 trillion ($3.8 billion) and more than VND2.6 trillion ($114.5 million), respectively, making the company one of the largest in Vietnam.

Revenue would increase 36.5 per cent and after-tax profit 18.3 per cent compared to 2017. The revenue goal of $3.8 billion for 2018 is a step towards its $10 billion target by 2020.

“We have reason to believe we will achieve the targets next year,” said CEO Tran Kinh Doanh. “First of all, the position of thegioididong.com will be strengthened, as the mobile phone market continues to grow well. Our Dien may Xanh chains will continue to expand with M&A activities, contributing significantly to total revenue from next year. We aim to open 1,500 stores in Ho Chi Minh City to late 2018.”

The revenue and profit targets for 2018 will be officially presented to the annual general meeting scheduled for March.

The company last year targeted 2017 revenue of VND63.3 trillion ($2.83 billion), which many analysts doubted was achievable. It reached 80 per cent of the target in the first ten months, with revenue of VND53.3 trillion ($2.34 billion).

MWG is also is in the process of completing the acquisition of the Phuc An Khang pharmaceutical chain. Phuc An Khang was established in May 2006 and has 14 pharmacies in Ho Chi Minh City. MWG plans to expand into pharmaceutical retail, targeting about 50 or 60 pharmacies next year, according to a report from HSC.

MWG also bought shares in electronics retailer the Tran Anh Company (TAG), taking over its IT and accounting systems and sending key personnel to operate the retailer. MWG will leave the brand name Tran Anh unchanged for the first couple of years.

Total investment in M&As by MWG in 2017 reached VND2.5 trillion ($110 million).

Deloitte Vietnam again among Most Sustainable Businesses

Deloitte Vietnam was among the “Top 10 Most Sustainable Businesses in Vietnam” in the trade-service sector for the second consecutive year at a recent ceremony hosted by the Vietnam Business Council for Sustainable Development in cooperation with the Ministry of Labor, Invalids and Social Affairs, the Ministry of Industry and Trade, the Ministry of Natural Resources and Environment, the Vietnam General Confederation of Labor, and the State Securities Commission.

Deloitte Vietnam was the only organization in the professional services industry to receive the notable award.

Evaluations and rankings were based on the Corporate Sustainability Index (CSI), which is derived from economic, social, and environmental activities and efforts. The CSI deeply reflects the business’s credibility, its ability to attract talent, its operational process, its potential for future development, and its social and environmental responsibilities.

After a thorough evaluation process, the Ratings Board selected the Top 100 businesses with the most methodical operations and sustainable development strategies in 2017.

“In the time to come, we are committed to contributing more towards Vietnam’s economic growth targets and building more sustainable values in Vietnam within the business community, including our clients and partners and the natural environment, and as a member of society,” said Ms. Ha Thu Thanh, Chairwoman of Deloitte Vietnam. “We take this very seriously, as this is the core value of Deloitte Vietnam that aligns with the country’s more than 26 years of development, and also Deloitte globally, in its position as the world’s largest professional services network with a history that spans almost 180 years.”

Vietnam’s dairy giants export milk to China

Dairy giants Vinamilk, TH true Milk, Nutifood and Anova Milk are rolling out ambitious strategies to export their products to China, a market with 1.4 billion people.

Vietnam’s dairy industry is developing well, producing about 1.2 billion litres of cow milk in 2017.

Experts said the most promising market for Vietnamese dairy is China. Aside from the two countries’ close proximity, China is also a huge dairy market, with estimated value of 30 billion USD each year. 

Demand for dairy products in the country is forecast to soar by 37 percent to more than 40 billion USD in the next five years, meaning China will surpass the US to become the biggest dairy consumption market in the world.

In 2017, the Vietnam Diary Products Joint Stock Company (Vinamilk) inked a memorandum of understanding (MoU) on cooperation in supplying dairy products to the Chinese market, a prerequisite for the official export of Vinamilk products to China.

The firm runs 13 factories in Vietnam and three others in the US, New Zealand and Cambodia, along with 10 dairy farms across Vietnam, and all of its cows are imported. Its products have been shipped to 43 countries like the US, Japan, Thailand and the Philippines, gaining more than 5.74 trillion VND (253 million USD) in export revenue in 2016 which is expected to reach 350 million USD in 2017.

General Director of Vinamilk Mai Kieu Lien said her company will boost sales in China. Average milk consumption in this market is relatively low, about 25kg per year, so there is a potential for stronger sales.

However, there remain many difficulties in exporting milk to China, she said, noting that Vietnam and China don’t have trade agreements on milk and milk products. Although Vinamilk signed an MoU with a Chinese partner, trade deals are still needed as some products haven’t been licensed to enter the market.

The Chinese side will survey Vinamilk’s factories to finish agreements in the near future, Lien added.

Meanwhile, TH true Milk is also implementing a milk export strategy. In late November 2017, TH Group began a dairy farming and processing project in the border district of Vi Xuyen of northern Ha Giang province. With planned investment of 4.5 trillion VND (198.4 million USD), the project aims to export fresh milk to China.

The firm opened a branch in Guangzhou city and also distributed some TH true Milk products in China.

Thai Huong, Chairwoman of TH Group, said 50 – 60 containers of their products are shipped to China each month. The Chinese partner ordered goods in very large volume, but the firm didn’t have enough dairy to fill the orders.

She expressed her hope that the project in Ha Giang will help TH approach this potential market.

Hoa Binh Company chosen for projects in Kuwait

The Hoa Binh Construction Group JSC (HBC) on December 25 said that it signed a cooperation deal with the United Guft Construction Company (UGCC) of Kuwait on a construction component of a Kuwaiti government refinery project.

The two companies will carry out a 20 million-USD reinforced concrete construction contract as part of the 30 billion-USD Al Zour Refinery Project.

HBC also signed an agreement with the Kuwait’s HOT Engineering & Construction Company on implementing a 35 million-USD contract as part of the Kuwait’s 155 million-USD criminal evidence headquarters construction project.

Previously in May, HBC inked a cooperative partnership deal with HOT Engineering & Construction. Accordingly, the Kuwaiti firm will prioritise working with HBC in construction. 

With these projects, HBC has laid a foundation in Kuwait and stands ready for others in 2018.

Sacombank bad loans ratio declines sharply
     
Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank) has successfully reduced its non-performing loans (NPLs) ratio to 4.4 per cent after operating for a year under a Government-approved restructuring scheme.

The bank plans to reduce the NPL rate, which stood at 6.68 per cent early this year, to below 3 per cent in 2018.

Under the restructuring scheme approved by the Government and the State Bank of Viet Nam, Sacombank is allowed to settle its NPLs within 10 years, starting from 2017. However, the bank has targeted to complete the difficult task within five years.

Sacombank chairman Duong Cong Minh said the bank’s restructuring scheme, including shaking up the bank’s organisation and human resources and re-arranging transaction networks and branches, was based on the strategy of “developing rural areas to support urban zones”.

Minh affirmed that his bank has taken drastic measures to implement the restructuring scheme. He believed that bad debt settlement will be effective due to upbeat signs in the property market and the National Assembly’s legal provisions for bad debts.

Sacombank’s representative announced that the two major goals in the 2018-20 period will be to speed up the bank’s restructuring process and the settlement of bad debts to improve its asset quality.

In addition, the bank will expand co-operation, aiming to reduce competitive pressure in the sector and become the top retail bank in the country and the region.

By the end of this year, the bank’s total assets are estimated to rise 11.5 per cent. Its credit growth and capital mobilisation have also risen by 12.9 per cent and 11.5 per cent, respectively.

The bank currently has 566 transaction offices in 48 cities and provinces of Viet Nam, Laos and Cambodia. 

Investment doubles for Central Highlands
     
The Central Highlands provinces have attracted 235 investment projects from domestic investors with total registered capital of nearly VND103.36 trillion (US$4.53 billion) so far this year, up nearly 203 per cent against 2016 and nine foreign direct investment (FDI) projects with a total capital of nearly $110 million.

According to the Central Highlands Steering Committee’s Standing Board, at present, the Central Highlands region, which comprises Lam Dong, Dak Lak, Dak Nong, Gia Lai and Kon Tum, are attracting more and more investors to construct production and business facilities, boosting socio-economic development. Lam Dong, Dak Lak and Gia Lai provinces are attracting the most domestic and foreign investors to set up manufacturing and business establishments in the region.

Dak Lak alone granted investment licences to 75 projects this year, with a total registered capital of nearly VND4 trillion. This marked a 17.19 per cent increase in the total number of projects and an increase in total registered capital of 2.46 times. A number of big projects using funds from investors instead of the provincial budget have been completed and put into operation.

The Central Highlands provinces have recently redoubled their investment promotion efforts. Besides organising conferences, editing investment promotion materials and publicising the projects on the provincial website, the provincial Department of Planning and Investment also strives to improve the investment and business environment. In particular, it works to improve the training of provincial officials who interact with enterprises and potential investors and to reform the administrative procedures in order to strengthen investors’ trust.

The Central Highlands provinces have also publicly disclosed the preferential investment policies regarding land rent, water surface lease, corporate income tax and incentives for the agricultural sector.

Specifically, Dak Lak offers the policy of land rent exemption for investors during the period of basic construction and an exemption for 11 years or more in the next period.

In Buon Ma Thuot City, land rent is exempted in the basic-construction period and exempted for seven years or more in the next period, with the timing depending on the investment field.

In districts and towns, the corporate income taxes are exempted for four years and reduced by 50 per cent for the following nine years after the taxable income is generated.

Besides, the Central Highlands provinces have also strived to plan transport infrastructure, industrial parks, telecommunication information, electricity, water and available land funds so as to create favourable conditions for investors and businesses.

The Central Highlands provinces continue to call for investment in such sectors including high-tech agriculture, organic agriculture, tourism, high-end convalescence, the agricultural processing industry and regenerative energy.

Ha Noi business info portal launched
     
The municipal Department of Information and Communications on Monday officially launched the Ha Noi business information portal with two domain names — http://hanoibusiness.vn and http//hanoibusiness.com.vn. 

The portal aims to enhance activities to support business development through international integration, especially through the application of the Fourth Industrial Revolution.

It will provide useful information about the legal environment, finance, banking sector, human resources market and commercial events. It will also help connect firms with markets and partners, especially in the information technology industry in the city.

In addition to this, the portal will act as a dialogue channel between management agencies and the business community.

At the event, the department signed a co-operation agreement with the Bank for Investment of Development of Viet Nam (BIDV).

Accordingly, the two sides will launch programmes together to support small- and medium-sized enterprises, start-ups and innovation firms by providing information and consultancy on BIDV’s financial and banking products and services. 

Safe farm produce week launched in Hanoi

The Week of Safe Farm Produce 2017 was launched in Hanoi today, featuring 27 businesses from five northern cities and provinces.

Jointly held by the Investment, Trade and Tourism Promotion Centre of Hanoi, the Hanoi Department of Agriculture and Rural Development, and Biggreen Vietnam, the event is an important agricultural trade promotional activity on the 2017 schedule.

More than 60 kinds of farm produce from Hanoi, Hoa Binh, Ha Nam, Nam Dinh, and Quang Ninh are on display at the centre. Businesses joining the event include Minh Duong JSC, Ba Huan Co., Ltd., and Sen Tri Farm, as well as Langer Vietnam.

As local consumers are becoming increasingly concerned with food safety, numerous supermarkets offering safer farm produce have been opened in recent months.

Co-operative Union of Agricultural Consumption (UCA) opened three safe farm produce supermarkets in Hanoi in November 2016. UCA plans to build 50-100 similar supermarkets in Hanoi and Ho Chi Minh City and other localities around the nation by 2018.

Pham Minh Tuan, chairman of the UCA Board of Directors, said the union is co-ordinating with nearly 200 cooperatives nationwide to sell safe products.

Similarly, Vietnam Co-operative Alliance opened its 5th safe farm produce supermarket in Hanoi in February 2017.

VNPT’s third attempt to divest Maritime Bank coming up

Vietnam Post and Telecommunications Group (VNPT) is auctioning 71,577,141 million Maritime Bank (MSB) shares in a single-batch sale on January 18 on the Hanoi Stock Exchange (HNX).

At the starting price of VND11,900 ($0.54) apiece, the total value of the sale is expected at VND851 billion ($38.68 million).

Investors eligible for bidding must satisfy the requirements of being of sound financial capacity and making a long-term commitment to provide financial support and retaining the current employees.  

Earlier, VNPT made two attempts to sell its holdings at the Hanoi-based lender, both times failing to find buyers.

In the first nine months through September, MSB’s total revenue reached VND8.631 trillion ($392.31 million), up 27 per cent on-year. Revenue from services accounted for VND225 billion ($10.22 million) of the total, an increase of 27 per cent on-year.

Pre-tax profit was reported to rise 207 per cent on-year to VND589 billion ($26.77 million). The lender posted its total assets at VND104.31 trillion ($4.72 billion), with chartered capital at VND11.75 trillion ($534 million).

In a press release dated December 15, Moody’s Investors Service has affirmed MSB’s local and foreign-currency bank deposits and issuer ratings at B3/Not Prime. At the same time, Moody’s has affirmed the bank's BCA and Adjusted BCA at caa1. The credit rating agency has also affirmed MSB’s counterparty risk assessment (CRA) of B2(cr)/Not Prime(cr). The rating outlook remains positive.

In its ratings rationale, Moody’s noted that the affirmation of the caa1 BCA reflects the elevated risks in MSB’s balance sheet, namely its large share of assets that Moody’s considers problematic.

As of the end of September 2017, the bank’s problem loan ratio was among the highest of the Vietnamese banks rated by Moody’s. Moody’s defines problem loans as loans in the categories 2-5 under Vietnamese accounting standards and gross bonds issued by Vietnam Asset Management Company (VAMC).

Profitability remains constrained due to the bank’s high share of low yielding assets in its balance sheet, coupled with very high credit costs. On balance, the BCA also considers MSB’s high capital levels and sound liquidity position.

The positive outlook on the supported ratings reflects the bank's committed and ongoing efforts to resolve its legacy problem assets, which should lead to improved asset quality and profitability metrics. Given the large size and concentrated nature of these legacy accounts, and the bank's positive expectations around recoveries, this could lead to meaningful improvements in asset quality in 2018. Material recoveries of impaired assets could significantly improve the bank's solvency profile.

The “moderate public support” assumption for MSB is based on the bank's modest 1 per cent share of system deposits at year-end 2016, as well as a history of regulatory forbearance in Vietnam. This resulted in its caa1 BCA rating increasing a notch to B3.

Saigonres to debut on HOSE

Saigon Real Estate JSC (Saigonres) plans to debut on the HCM Stock Exchange at VND29,000 (US$1.29) per share, ending two years trading on the Unlisted Public Company Market (UPCoM).

The debut date remains unknown. The HCM Stock Exchange on November 1 said Saigonres still lacked some required documents to fulfill its filing.

Saigonres is trading nearly 39.6 million shares on UPCoM. The firm’s shares finished Friday at VND30,000 per share.

The expected price level is calculated based on the 30-day average price of Saigonres shares on UPCoM between October 9 and November 29, which was VND28,942 per share.

On July 18, Saigonres got shareholders’ approval on the company’s move from UPCoM to HOSE.

In 2016, Saigonres posted an eight-fold increase in its net revenue to VND1.08 trillion ($48 million) and a 14-time rise in its post-tax profit to VND273 billion.

On June 26, Saigonres issued nearly 19.8 million shares at the 1:1 ratio as dividend payout for current shareholders. The share issuance almost doubled the company’s charter capital to VND396 billion from VND198 billion.

In the first nine months of 2017, Saigonres posted VND545 billion in revenue, an increase of 17 per cent year on year, and VND107.5 billion in post-tax profit.

Fruit and vegetable exports hit 3.34 billion USD

Vietnam’s exports of fruits and vegetables hit 3.34 billion USD as by December 15, a surge of 45 percent year on year, surpassing 2016’s revenue of 2.457 billion USD, according to the updated report of the General Department of Vietnam Customs.

According to the Ministry of Industry and Trade, China is the major market of Vietnamese fruits and vegetables, buying products worth 2.4 billion USD in 11 months, accounting for 75.7 percent of Vietnam’s total export value, a year-on-year rise of 54.9 percent.

Sharp increase was also recorded in other markets such as Japan, the US, the Republic of Korea, the Netherlands, Malaysia, and Thailand.

Among 23 markets of Vietnamese fruits and vegetables, downturn was seen only in four markets of Thailand, the UK, Cambodia and Indonesia.

So far, the export revenue of fruits and vegetables has surpassed that of rice, coffee and even crude oil.

For the whole year, the figure is estimated to reach over 3.51 billion USD, up 43 percent over 2016.

The Vietnam Fruit and Vegetables Association (Vinafruit) forecasts that potential of Vietnamese fruits and vegetables is high in both global and domestic markets. 

Informative labeling in service of the tracking of origin and production areas of commodities have made locally-grown vegetables and fruits win higher market shares and enter others markets more easily. 

The association predicted that the sector’s export revenue in 2018 will be higher than the 2017 figure.

Higher profits make it easier for banks to raise capital

The Housing Development Commercial Joint Stock Bank (HDBank) has been allowed to increase its chartered capital from more than 8.828 trillion VND (392.3 million USD) to 9.908 trillion VND. 

It was the second time HDBank has revised up its chartered capital in a year. 

Earlier, the Military Commercial Joint Stock Bank (MB), the Vietnam Prosperity Joint Stock Commercial Bank (VPBank) and the Asia Commercial Bank (ACB) raised their chartered capital to over 18.1 trillion VND, 15.7 trillion VND and 11.2 trillion VND, respectively. 

The Vietnam Technological and Commercial Joint Stock Bank (Techcombank) plans to raise its charter capital to 14 trillion VND via selling shares to existing shareholders. 

According to the National Financial Supervisory Committee (NFSC), buoyant securities market and growing profits make it easier for domestic banks to increase capital. 

Financial-banking expert Nguyen Tri Hieu attributed big profits to credit growth, saying that credit grew by 15.9 percent in October and is expected to reach 18 percent this year. 

Better risk management and lesser spending for risk provision fund led to higher profits, he said. 

Hieu commented that banks in general have fairly high capital than the past years.

Song Da Corporation reports pathetic IPO

Despite the fact that Song Da Corporation’s initial public offering (IPO) was considered a large-scale deal, only 790,900 shares, equalling 0.36 per cent of the offered 219.68 million shares, were sold at the auction organised this morning, according to information published by the Hanoi Stock Exchange.

Notably, no foreign and domestic enterprises or organisations joined the auction. 229 individuals completed the purchase at the average price of VND11,959 apiece, showing that 99.64 per cent of the stake was unmarketable. After the deal, the state only acquired VND8.8 billion ($378,666) in proceeds.

Song Da offered 219.68 million shares at the initial price of VND11,000 ($0.48). After the sale, the corporation expected to acquire VND2.4 trillion ($105.68 million) in proceeds and increase its charter capital to VND4.5 trillion ($198.2 million).

Besides, Song Da planned to offer another 135 million shares, equalling 30 per cent of its charter capital, to strategic investors and sell 822,000 shares (0.18 per cent) to its employees.

After the equitisation, the state was to hold 51 per cent of the charter capital, equalling 229.5 million shares, and then decrease it to under 50 per cent by 2020.

Song Da Corporation conducted its equitisation as the company’s business efficiency has yet to improve. Notably, in 2015, the corporation earned VND17.03 trillion ($762.1 million) in revenue and VND452 billion ($18.7 million) in after-tax profit, while the Return on Assets (ROA) was 1.84 per cent, and the Return of Equity (ROE) 7.49 per cent. In 2016, its revenue decreased by 42 per cent to VND9.9 trillion ($436.1 million).

In the first six months of this year, Song Da Corporation recorded VND4.41 trillion ($194.3 million) in net revenue and VND118 billion ($5.19 million) in pre-tax profit, signifying year-on-year declines of 24 and 48 per cent, respectively.

Along with the modest business results, Song Da Corporation bears a large debt volume. As of the end of the second quarter of this year, the total debt-to-capital ratio is 76 per cent and the total debt is triple the company’s equity.

Established in 1961, Song Da Corporation is specialised in developing thermal power plants, roads, industrial factories, and real estate projects, as well as manufacturing construction materials.

Dat Lat hotels faces falling number of guests

Many hotels in the Da Lat City have complained about the falling number of guests despite it being the city’s peak tourism season.

The Da Lat Flower Festival is currently taking place and the New Year is nearing, lots of hotels still have vacant rooms. Many hotels are offering 10-20% discounts.

Nguyen Thi Hong, a hotel owner on Nam Ky Khoi Nghia Street, said that this year her hotel has seen the sharp decline of guests.

According to Hoang Van Thanh who owns a guesthouse on Nam Ky Khoi Nghia, he turned down tourists who wanted to pay VND800,000 (USD36.3) per single room as it is quite low price during the peak tourism season. However, he had nearly no other bookings until that night, where he had to rent a single room out for VND500,000. 

To attract more customers to Da Lat tours, travel firms have launched many attractive promotions such as offering a VND1-million (USD47.6) bonus for customers.

Da Lat has around 1,200 hotels and guest houses which can serve around 50,000 guests. Homestays are also quite popular in the city.

Declining numbers of visitors have been attributed to increased construction work, destruction of the city’s iconic pine woods, fewer flower gardens and repetitious content of the Da Lat Flower Festival.

Becamex IDC to auction leftover IPO shares

The Investment and Industrial Development Corporation (Becamex IDC) plans to sell the shares left over from the firm’s initial public offering (IPO) in early December.

Becamex IDC will offer more than 296.4 million shares for sale on January 3 at the starting auction price of VND31,000 (US$1.38) per share – equal to the starting selling price at the firm’s IPO.

Only the investors that took part in the company IPO are allowed to attend the coming share sale, which will be held at the HCM Stock Exchange.

Investors can sign up to participate in the auction between December 26 and 29.

The Becamex IDC IPO on December 1 was considered a failure as the company was able to sell only 6.1 per cent of total 311.2 million shares offered for auction.

At the IPO price level of VND31,000 per share, the company IPO had been expected to be the biggest IPO in 2017 and the second-biggest since Vietcombank IPO in late 2007.

According to investors, the starting auction price that Becamex IDC set for its IPO was too expensive compared to the market’s average while the Binh Duong-based company had not performed convincingly with its massive loans and low-profit real estate projects. 

Mobile World nears profit goal

The digital retailer Mobile World Investment JSC (Mobile World) has reported that its 11-month post-tax profits reached 91 per cent of the full-year profit forecast.

Its post-tax profit was nearly VND2 trillion (US$88.5 million) in 11 months, a yearly increase of 38 per cent.

The company announced that its revenue in 11 months increased 49 per cent year on year to nearly VND59 trillion, with annual income growth rates in its electronics and mobile phone retail sectors hitting 124 per cent and 14 per cent.

The company’s Bach hoa xanh (Green store) retail chain, which sells vegetables and fruits, contributed VND1.19 trillion to the company’s 11-month revenue and online sales rose 74 per cent on a yearly basis to VND5.1 trillion.

In 11 months, Mobile World opened 668 new stores nationwide, including 351 electronics stores, 200 Bach hoa xanh stores and 117 mobile phone retail stores.

The total number of Mobile World’s stores reached 1,923 after 11 months, including 1,068 phone stores and 607 electronics stores.

In 2018, Mobile World plans to record VND86.4 trillion in full-year revenue and VND2.6 trillion in post-tax profit.

SHB sells brokerage arm SHBS

Sai Gon-Ha Noi Joint Stock Commercial Bank (SHB) has sold 98.47 per cent of its shares in its brokerage arm SHB Securities JSC (SHBS), equal to 14.77 million shares.

The shares were sold equally to three individuals for VND7,850 (35 US cents) per share, lower than the par value of VND10,000 per share. SHB estimated it would receive nearly VND116 billion ($5.15 million) from the deal.

SHBS was formerly known as Hanoi Building Joint Stock Commercial Bank (Habubank) Securities JSC (HabubankSc), which was owned by Habubank before 2012.

The company was renamed SHBS after Habubank was acquired by SHB in 2012.

In August 2016, SHB also offloaded its entire ownership in Sai Gon-Ha Noi Securities JSC for VND6,600 per share.

Though SHB is no longer a shareholder of SHS, the bank remains the main source of financial capital for the securities company.

The total value of short-term loans that SHB lent to SHS increased to VND700 billion at the end of September from VND386 billion in late second quarter.

At the company’s annual shareholder meeting in April 2017, shareholders of SHS approved the firm’s proposal to acquire SHBS. However, it has remained unclear if the two brokerage firms would finalise their merger.

BSR targets over VND3.47 trillion profit next year

Binh Son Refining and Petrochemical Co Ltd (BSR), operator of Dung Quat Refinery, has targeted total revenue of nearly VND78.4 trillion (US$3.44 billion), State budget contribution of some VND8.33 trillion and profit-after-tax of more than VND3.47 trillion in 2018.

It was one of the contents at BSR’s conference to review the company’s performance in 2017 and assign tasks for 2018 held in the southern central province of Quang Ngai last week.

Tran Ngoc Nguyen, BSR’s general director, said in 2017, BSR exceeded planned targets with production output of 6.1 million tonnes, consumption output of nearly 6.1 million tonnes. Turnover was estimated at nearly VND80.52 trillion, contribution to the State budget was VND10.34 trillion and profit-after-tax was some VND8.04 trillion.

In 2017, Dung Quat Oil Refinery operated continuously, stabilising at an average capacity of 105 per cent designed capacity. The third maintenance activity for the 7,000 main equipment categories of the plant in June and July were completed and exceeded the targets set.

This year, BSR planned to implement 19 energy optimisation solutions, saving some $1.45 million per year for the company. In addition, BSR’s cost saving in 2017 was estimated at VND932.82 billion (surpassing 97.2 per cent of the plan).

Viet Nam National Oil and Gas Group (PVN)’s general director emphasised that BSR has contributed significantly in PVN. The revenue of BSR accounted for 16 per cent of PVN’s total revenue. Its contribution to the State budget accounted for 10 per cent of PVN. In addition, BSR contributed 33 per cent of PVN’s total profit.

With regard to equitisation, BSR will be the largest enterprise to be equitised ever, with a value of some $3.2 billion. The company plans to sell 242 million shares at an initial price of VND14,600 per share, equivalent to 7.79 per cent of its charter capital, at its initial public offering (IPO) on January 17, 2018, at the HCM Stock Exchange.

BSR has targeted collecting some VND4 trillion for State coffers via this IPO. In the next phase, BSR will sell 49 per cent of charter capital to strategic investors, collecting nearly $1 billion for the State. 

Ninh Thuan: Feed processing factory construction kicks off

Construction of a high-tech cattle feed processing factory kicked off on Sunday at the Phuoc Tien Industrial Complex in Bac Ai District’s Phuoc Tien Commune, southern Ninh Thuan Province.

Invested by the Ninh Thuan Agritech Hi-tech Co Ltd, the factory is built on an area of 11.7ha at a cost of VND15 billion (US$666,600) in the first phase. The company expects to raise investment capital to VND108 billion in the following phases depending on market demand.

Ninh Thuan Agritech general director Le Van Thanh said with designed capacity of 3,000-5,000 tonnes per day, the company needs to have a corn and herd farm covering an area of 4,000-6,000ha.

The company will link its production with households’ farming. Households will contribute farming land lots, while the company will pay for farmers to work on that land, fertiliser and farming technology, and seek markets, Thanh said.

Chairman of the provincial People’s Committee Luu Xuan Vinh said this is a significant task that contributes to boosting the province’s modernisation and industrialisation process, creating jobs and increasing income for local farmers.

He asked the investor to mobilise resources to ensure construction quality, labour safety and environmental hygiene.

He also ordered the company to set up a recruitment plan with priority on local employment and fulfilling social responsibility.

Meanwhile, local departments and authorities must create favourable conditions for the firm during construction as well as facilitate its operation and business activities in the locality. 

Dong Nai to export more pepper to Europe in 2018

Lam San Agriculture Cooperative in Cam My District, Dong Nai Province, is negotiating with European partners to sign contracts to export some 1,500 tonnes of pepper to Holland and Germany in 2018, according to the cooperative.

The cooperative exported 800 tonnes of clean pepper to these markets in 2017, higher than the export volume of 300 tonnes in 2016.

Nguyen Ngoc Luan, director of the cooperative, said Lam San is the first business in Viet Nam to export pepper to the European market. It started exporting pepper to the European markets in 2015. To sign long-term export contracts, the cooperative must have a large supply of pepper that meets standards on food safety through cooperation with 1,500 households producing pepper.

The cooperative has provided farmers with agronomic knowledge about land, water, crops, new farming techniques and the use of pesticides and fertilisers in a scientific way, he said.

Demand for pepper in the European market is huge, however, farmers need to produce pepper according to the safety production process. This will help them improve the quality of pepper, expand the market and increase farmers’ income, Nguyen Van Nam, a member of the cooperative, said.

Dong Nai Province has some 15,000ha where pepper is grown, concentrated in Cam My, Xuan Loc and Thong Nhat districts. 

Japan’s Mitsubishi Group invests 30 million USD in HCM City’s green property

The Diamond Lotus Riverside Complex in District 8, Ho Chi Minh City will be built in accordance with green construction standards with 30 million USD in investment from the Japanese Mitsubishi Group.

The investment will be made through Phuc Khang Corporation after the two sides inked a strategic cooperation agreement to branch out green housing projects in the city.

The complex will be developed under the Leadership in Energy and Environment Design (LEED) standards devised by the US Green Building Council.

After the Diamond Lotus Riverside project, the two partners will work together to develop more property investments in Districts 1, 2, 8 and 10 and Tan Binh and Tan Phu districts. 

According to reports from the municipal People’s Committee, the real estate sector attracted the largest foreign direct investment amount with 984.4 million USD during January-November, tripling the figure the same period last year.