According to the Agriseco analysis group, stocks in the construction materials and infrastructure construction industry will directly benefit from the wave of disbursement of public investment capital, while industrial, residential and logistics real estate will benefit. Indirect.
In the newly published analysis report, the analysis team of Agribank Securities Company (Agriseco) commented Public investment is considered a driving force for economic growth in the context that other economic growth drivers such as consumption and exports are still recovering slowly in the context of global economic fluctuations.
The total public investment capital plan in 2024 is 657.000 billion VND, an increase of 12% compared to implementation in 2023 and equal to 95% of the 2023 plan. In the first 2 months of this year, the value of public investment disbursement continued to prosper. estimated to reach nearly 60.000 billion VND, an increase of 21% over the same period in 2023.
“We expect the disbursement rate of public investment to continue to increase next year when many key projects (highways, inter-regional, coastal roads) have been removing difficulties in investment preparation. private", Agriseco's report wrote.
Promoting public investment disbursement is expected to create spillover effects on many industry groups. It is estimated that if public investment capital disbursement increases by 1% compared to the previous year, GDP will increase by 0,058%. According to Agriseco, construction materials and infrastructure construction are two industry groups that directly benefit from increased disbursement of public investment capital. Meanwhile, three industry groups that indirectly benefit are residential real estate, industrial real estate and logistics.
Specifically, construction materials group (steel, stone, cement, asphalt) benefit directly right after the site clearance phase, entering project implementation until completing project construction activities. For the steel industry, businesses that produce and supply steel for public investment projects and transportation infrastructure will benefit from increased demand for steel consumption. For the construction stone industry, currently in many public investment projects (North - South expressway phase 2; Bien Hoa - Vung Tau expressway, Long Thanh airport) there is a shortage of land for leveling. . Therefore, Agriseco expects that leading enterprises in the stone industry, owning quarries with large reserves, and located near key projects will benefit significantly.
Similar, infrastructure construction group also benefit directly from the construction of key public investment projects. A number of key transport infrastructure projects such as North-South Expressway Phases 1 and 2, Long Thanh Airport, Belt 3 of Ho Chi Minh City, Ring 4 - Capital Region, 500kV power line project are implemented will help construction contractors (especially contractors with project construction experience). However, some factors that need to be noted by businesses in the infrastructure construction group are cash flow balance and shortages and price fluctuations of construction materials.
For residential real estate group, Agriseco experts believe that businesses in this industry will benefit indirectly when the planning of large public investment projects is approved. This will attract demand for real estate and housing in neighboring areas and provinces with projects when infrastructure is expected to be completed. Potential localities in the coming period include: The North (Hai Phong, Hung Yen, Quang Ninh), the South (Southeast economic quadrilateral: Ho Chi Minh City, Binh Duong, Dong Nai, Ba Ria - Vung Tau). Some policies to remove difficulties in the real estate market are expected to solve some capital and legal problems for real estate businesses. However, Agriseco noted that the real estate industry is also facing many other risks such as corporate bonds, investor confidence, and transaction liquidity.
Industrial park real estate group It is expected that attracting more FDI capital to invest in industrial parks when transportation and highway infrastructure is completed will help increase connectivity between regions and industrial parks.
“In 2024, industrial park real estate will continue to benefit from capital flows moving manufacturing plants, signed FTAs, and new generation FDI attraction policies. Business groups with advantages in land funds ready for lease, signed lease MOUs and stable financial capacity are expected to benefit," Agriseco's report wrote.
Logistics is the last group expected to benefit indirectly from the disbursement of public investment capital. According to Agriseco, once completed, the expressways will make logistics activities much more convenient, thereby serving as a catalyst to promote economic growth and attract foreign investment. Large projects such as Long Thanh Airport are also expected to help cargo and passenger transport groups benefit from increased operating capacity.
