DIC Corp (DIG)'s outstanding bond debt may once again reach a peak of 3,000 billion VND.

DIC Corp issues an additional 2.1 trillion VND in bonds.

At the end of 2022, DIC Corp (stock code DIG) repurchased bonds ahead of schedule. After several quarters of less-than-effective business, DIC Corp had to issue a new bond issue worth VND 2,100 billion to raise funds for new projects.

Specifically, DIC Corp has approved a plan to issue up to VND 2,100 billion in private placement bonds in 2023. These are non-convertible bonds, without warrants, and secured by a payment guarantee from a credit institution. The issuance is expected to take place from Q4 2023 to the end of 2024.

The DIC Corp. bond issue could reach a threshold of 3 trillion VND (Figure 1). — DIC Corp's (DIG) outstanding bond debt is likely to escalate again to 3 trillion VND (Photo: Provided).

According to DIC Corp's announcement, the purpose of the issuance is to raise funds for three major projects, including: the Long Tan Tourist Urban Area project; the A5 Apartment building project in the Chi Linh Central area, Vung Tau City; and the Cap Saint Jacques Complex project.

DIC Corp's outstanding bond debt has long been a topic of interest for investors. At the beginning of 2022, DIC Corp recorded a massive total outstanding bond debt of VND 3,387.2 billion. Following fluctuations in the corporate bond market, DIC Corp repurchased bonds, reducing its outstanding bond debt to only VND 889 billion at the end of Q3 2023.

If the aforementioned plan to issue 2.1 trillion VND in bonds is successfully implemented, DIC Corp's outstanding bond debt could once again increase to nearly 3 trillion VND.

We have only achieved 10% of our annual business targets.

DIC Corp's business performance has consistently declined due to the sluggish real estate market. Revenue in the most recent Q3 2023 reached VND 235.2 billion, a decrease of approximately 44.5% compared to the same period last year. The company recorded a gross profit of VND 66.9 billion, a decrease of 41% compared to the same period last year. The corresponding gross profit margin was 28.4%.

During the period, financial revenue was recorded at VND 10.8 billion, a decrease of 27.6%. At the same time, financial expenses also decreased by two-thirds, to VND 11.6 billion. Selling expenses and administrative expenses both decreased, recorded at VND 46.6 billion.

After deducting all expenses, DIC Corp's after-tax profit was VND 12.1 billion, an improvement compared to the same period last year. However, it should be noted that the company avoided losses partly due to significant reductions in payable expenses. Business operations are still being affected by the sluggish market, with revenue declining sharply compared to the same period last year.

DIC Corp's cumulative revenue for the first nine months of the year reached VND 593.7 billion, a decrease of 60.9% compared to last year. After-tax profit decreased by 31%, to only VND 97.7 billion. Compared to the business targets set at the beginning of the year, DIC Corp has only achieved 10% of its annual profit plan.

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