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Mobilizing $500 million, Vietjet Air to ‘play big’

Vietjet Air (VJC) plans to raise $500 billion to scale up its operation as the tourism industry is expected to thrive again, as many air carriers are still in difficulty, according to a new resolution of the VJC Board of Directors.

Vietjet Air plans to make a private offering of 34.8 million shares to 100 professional securities investors at the price of VND135,000/share to collect nearly VND4.7 trillion in 2022-2023 after it gets the nod from the State Securities Commission (SSC).

The capital will be disbursed from Q4/2022 to Q1/2023. More than VND2.3 trillion would be used to improve liquidity and working capital, VND1.1 trillion to lease and buy aircraft, and VND1.2 trillion to lease and buy engines and equipment.

Earlier, its shareholders’ meeting approved a plan to issue 3-5 year convertible shares worth VND6.96 trillion ($300 million). The capital will also be used for investment, and to lease and buy engines, as well as improve liquidity and working capital for business. At the meeting, Vietjet Air shareholders also approved a plan to issue over 108.3 million shares to pay dividends and increase the charter capital. 

With the first two plans, Vietjet Air will mobilize VND11.4 trillion (nearly $500 million). Its charter capital will also increase sharply.

The aviation sector is seeing better business results with profits and decreased losses. However, enterprises in the sector are still facing difficulties because of high fuel prices, and international air routes have not fully recovered.

Vietjet Air in Q2/2022 reported after-tax profit of VND181 billion, raising the accumulated profit in the first half of the year to VND426 billion.

Its consolidated revenue in Q2 reached VND11.6 trillion and in H1 VND16.1 trillion, an increase of several times compared with the same period last year and higher than the same period of 2019.

Vietjet Air’s Q2 and H1 business results are impressive, which reflect the strong recovery of travel demand after the pandemic.

M. Ha

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