A stock on UPCoM tripled in a few months

After strong corrections, VN-Index has fallen sharply to a 3-month low, market valuations have also cooled down significantly as both P/E and P/B are lower than the average of many years. This is the deepest decline since the beginning of the year.

On the UPCoM floor alone, in September, the UPCoM-Index tended to decrease when closing September 2023 at 88.78 points, down 4.86% compared to the end of August 2023. Market liquidity also declined with the average trading volume decreasing by 18.07%, reaching approximately 68.92 million shares/session, the average trading value decreasing by 16.02% compared to August 2023, reaching more than VND 1,046 billion/session.

However, in the context of a declining market and declining liquidity, GSM shares of Huong Son Hydropower JSC witnessed an increase of 77.42% in just 1 month.

In the trading session on October 4, although GSM shares had no liquidity, they still reached the threshold of 31,500 VND/share - the highest price since the shares were listed on the stock exchange. This price is 60% higher than in late August - early September, when the shares were trading around 15,444 VND/share.

Compared to the bottom in April 2023, GSM's market price has tripled to VND31,000/share. Market capitalization has also increased by nearly VND300 billion after 6 months, to nearly VND900 billion. Meanwhile, the VN-Index has increased by 8.6% since the beginning of the year and decreased by 6.3% over the past month.

Finance - Banking - A stock on UPCoM tripled in a few months — GSM stock performance over the past year (Source: Trading View).

Huong Son Hydropower Joint Stock Company, formerly known as Huong Son I Hydropower Plant, was established on March 10, 2003. In 2011, Units 1 and 2 were connected to the national grid. In 2015, the company's shares were traded on the UPCoM market. GSM is currently managing and operating Huong Son 1 Plant, including 2 generators with a total installed capacity of 33 MW. Business lines: electricity production, transmission and distribution; construction of all kinds of houses; project design consultancy...

Since 2021, GSM shares have only fluctuated around VND 14,000/share. Until early August 2023, the shares suddenly increased to VND 17,000/share, accompanied by a slight improvement in liquidity with an average trading volume of 1,658 shares/day.

Previously, this stock was hovering around VND9,000/share. However, in September 2017, surpassing the "big guys" specializing in investment business, Kim Thanh Hotel - Service JSC successfully acquired Huong Son Hydropower JSC at a share auction with a price of VND15,300 per GSM share to own 53.9% of charter capital.

Thus, after 5 years under the new owner, Huong Son Hydropower's net revenue has fluctuated somewhat. Specifically, in 2017, the company reached 154 billion VND, but in 2019, there was a clear decline when it only reached 107 billion VND. In 2020, the company had a certain growth when it earned 125 billion VND and in 2022, it was 174 billion VND.

Although revenue increased, the company's profit after corporate income tax in 2017 and 2020 went in the opposite direction, reaching VND47 billion and VND32 billion respectively. After 2020, the company's profit continued to increase, with a profit after tax of VND66 billion in 2022.

Huong Son Hydropower's total assets from 2017 to 2020 showed signs of gradual decline, from VND 625 billion in 2017 to VND 589 billion in 2020. Therefore, the company's liabilities also gradually decreased from VND 288 billion to VND 206 billion. However, from 2021 onwards, total assets improved again with the figure at the end of 2022 being VND 679 billion.

The company's equity has been increasing over the years. Specifically, from 337 billion VND in 2017, it increased to 382 billion VND in 2020, and reached 489 billion VND in 2022.

Regarding the shareholder structure, as of June 30, 2023, Kim Thanh Hotel Service Joint Stock Company currently holds the largest share with a ratio of 26.68%; Ha Tinh Minerals and Trading Corporation - JSC holds 19.75%; Ms. Nguyen Thi Nhan Ai holds 10.21% of shares; Ms. Tran Thi Kim Thoa holds 10% of shares; Dai Hiep Company Limited holds 10% and Ms. Nguyen Thi Minh holds 6.06% .

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