Quoc Cuong Gia Lai Joint Stock Company (QCG) has endured more than two years of unprecedented upheaval following two major legal cases involving founder Nguyen Thi Nhu Loan and the Bac Phuoc Kien development project. While the company now has an opportunity to rebuild, it continues to face significant challenges related to legal procedures, cash flow and core business operations.

More than two years of turbulence

QCG has gone through the most turbulent period in its corporate history. Two major legal cases in succession significantly disrupted the company's operations, affecting its business performance, financial position and investor sentiment.

The first shock came in April 2024, when the court trying the Van Thinh Phat case ordered QCG to return nearly VND2.883 trillion (US$110 million) that it had received from Sunny Island Corporation. The funds were to be recovered as part of the enforcement of judgments against Truong My Lan.

The payment stemmed from a transaction involving the transfer of the Bac Phuoc Kien project in Nha Be District, Ho Chi Minh City.

The development had long been regarded as one of QCG's flagship projects and was expected to become a major contributor to revenue and profit. Besides repaying the substantial amount, the company has also had to wait for legal procedures to be completed before it can recover the project's legal documentation and resume development.

Only a few months later, the company was hit by an even bigger setback.

On July 19, 2024, Nguyen Thi Nhu Loan, the company's founder, former Chairwoman and former Chief Executive Officer, was arrested by the Ministry of Public Security's Investigation Police Agency (C03) for alleged violations involving the management and use of state assets, causing losses and waste. The investigation centered on a land project at 39–39B Ben Van Don Street in Ho Chi Minh City.

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Nguyen Thi Nhu Loan. Photo: Nguyen Hue.

According to investigators, the 6,200-square-meter property, originally classified as state-owned assets, had been transferred in violation of regulations, causing losses estimated at more than VND542 billion (US$20.7 million). Authorities alleged that Loan and the company gained approximately VND297.8 billion (US$11.4 million) from the transaction.

At the trial held in April 2026, after all financial consequences had been remedied, the court recognized multiple mitigating circumstances, applied more favorable provisions under updated legal policies and sentenced Loan to 18 months' imprisonment, suspended.

Following Loan's prosecution, her son Nguyen Quoc Cuong was reappointed Chief Executive Officer in late July 2024, marking his return to executive management after nearly six years away. His comeback, however, came at a time when the company was simultaneously grappling with legal issues, liquidity pressure and weakening business performance.

The difficulties continued as QCG failed to hold its 2024 annual general meeting of shareholders as originally scheduled.

Even after the review of its 2025 semi-annual financial statements, the company's auditor continued to express doubt about QCG's ability to continue as a going concern because its short-term liabilities exceeded its short-term assets.

Throughout this period, QCG shares experienced sharp volatility in response to legal developments, reflecting investors' cautious sentiment toward the company.

Recovery opportunities come with major challenges

After more than two years of turbulence, Quoc Cuong Gia Lai has entered a restructuring phase under the leadership of Chairman Lai The Ha and CEO Nguyen Quoc Cuong.

Some encouraging signs have begun to emerge.

The legal issues involving Nguyen Thi Nhu Loan have largely been resolved following the first-instance court ruling. The company has also gradually fulfilled its obligation to repay the amount linked to the Bac Phuoc Kien project.

By the end of the first quarter of 2026, QCG had repaid approximately VND1.3 trillion (US$49.6 million), reducing the outstanding balance to nearly VND1.583 trillion (US$60.4 million).

This repayment is regarded as a key condition for the company to regain the project's legal documents and resume development in the future.

From a financial perspective, QCG's total liabilities declined to around VND3.625 trillion (US$138.4 million), while short-term borrowings fell by nearly 30% from the beginning of the year to about VND578 billion (US$22.1 million). The company has also continued to receive financial support from shareholders and senior executives.

Despite these positive developments, the company's recovery still depends heavily on its core business.

During the first quarter of 2026, Quoc Cuong Gia Lai generated revenue of just over VND69 billion (US$2.6 million), down nearly 38% year-on-year. Higher profit mainly resulted from lower finance and administrative expenses rather than any meaningful recovery in property development.

Revenue from the real estate segment plunged 76%, indicating that project implementation remains slow.

Against this backdrop, QCG's share price has continued to weaken. On July 10, the stock fell to VND11,650 per share, its lowest level in a year, as investors awaited the company's second-quarter earnings.

Quoc Cuong Gia Lai has also previously faced issues involving real estate projects, disclosure obligations and delays in holding shareholder meetings.

These issues have reinforced investor caution and remain challenges that the new leadership must overcome in order to gradually restore the company's reputation and credibility.

Nevertheless, there are reasons for optimism.

At its 2026 Annual General Meeting, shareholders approved a revenue target of VND2.403 trillion (US$91.7 million), several times higher than the VND392 billion (US$15 million) recorded in 2025 and VND668 billion (US$25.5 million) in 2024.

The company also targets pre-tax profit of VND343 billion (US$13.1 million).

Of the planned revenue, VND1.5 trillion (US$57.3 million) is expected to come from property and service sales, while VND903 billion (US$34.5 million) represents revenue generated in 2025 that is eligible for recognition in 2026.

The ambitious plan suggests management expects legal bottlenecks to be resolved more quickly, allowing revenue recognition from several key projects.

However, achieving those targets will ultimately depend on the pace of legal progress and the recovery of Vietnam's real estate market.

After enduring two consecutive years of legal shocks, Quoc Cuong Gia Lai may have passed its most difficult period. But restoring market confidence will require more than optimism. It will depend on stronger cash flow, the successful restart of key projects and tangible improvements in operating performance.

Manh Ha