Novaland reports negative profits, real estate stocks surge

On April 28, No Va - Novaland Real Estate Investment Group Corporation (NVL), chaired by Mr. Bui Thanh Nhon, announced its business results for the first quarter of 2023.

In the context of many market challenges, Novaland recorded a negative consolidated profit after tax of VND 410 billion. Total consolidated revenue was over VND 604 billion, down 69% compared to the same period in 2022.

Of which, revenue from sales reached nearly VND453 billion, recorded from the handover of projects such as NovaWorld Phan Thiet, NovaWorld Ho Tram, Aqua City, Palm City, Saigon Royal and Soho Residence; revenue from providing services reached more than VND151 billion.

Novaland's indicators and business activities in the first quarter were somewhat less positive than the same period last year when gross profit margin only reached about 25% and net profit recorded negative.

As of March 31, Novaland's total assets reached more than VND 256,194 billion, down 1% compared to the end of 2022. Of which, inventories recorded nearly VND 136,905 billion.

On April 19, The Grand Manhattan project in the center of District 1 (HCMC) was restarted when it was funded by TPBank and continued construction. This is one of 7 projects that the HCMC People's Committee has removed legal obstacles and has so far had positive changes.

It is expected that from the second quarter of 2023, Novaland will focus on working with financial partners and construction contractors to soon start rebuilding projects in the center of Ho Chi Minh City and urban areas such as Aqua City, NovaWorld Phan Thiet, and NovaWorld Ho Tram.

*The Grand Manhattan project restarts. (Photo: NVL)*

Real estate stocks soar

In recent times, real estate has received many positive signals from the Government and ministries. In addition to establishing a Prime Minister 's Working Group to review, urge, and guide the removal of difficulties and obstacles in the implementation of real estate projects in localities, the Government has issued Decree 08/2023/ND-CP on individual corporate bonds; Resolution No. 33/NQ-CP on solutions to remove and promote the safe, healthy, and sustainable development of the real estate market...

Many localities are also providing support to revive the real estate market - a field considered relevant, creating jobs for many workers, creating large revenue for the budget, contributing to promoting local economic growth.

Currently, real estate is estimated to directly contribute about 12% of the country's GDP. But in reality, this sector indirectly contributes 20-25% to economic growth because it is related to at least 50 other economic sectors.

In Ho Chi Minh City, first quarter growth reached only 0.7% due to the construction industry growing negative 20%.

According to the Ho Chi Minh City Real Estate Association (HoREA), the biggest difficulty for businesses is still legal problems, accounting for 70% of projects.

In this year's general meeting of shareholders (2023), businesses no longer paint rosy business plans to shareholders and are aware that market difficulties still exist. The priority plan is risk management and restructuring. Most businesses set profit plans to decrease by several dozen percent compared to 2022 such as: TTC Land, Ha Do...

However, many real estate stocks increased quite strongly this week because they had fallen sharply over the past year and showed signs of recovery thanks to policies.

Real estate stocks soared, helping the stock market have an exciting trading session before the April 30-May 1 holiday. The VN-Index recovered to the 1,040 point mark.

In the last session of the week (April 28), besides the leadership of the big pair Vinhomes (VHM) and Vingroup (VIC) when both closed at the highest price of the day, with increases of 4.2% and 3.2% respectively, a series of small and medium-sized stocks in the real estate industry competed to make waves.

Typically, DIC Corp. (DIG) shares successfully hit the ceiling and closed at VND18,700/share. The matched volume reached over 34 million units. This is the highest liquidity in the past half month.

In addition, NLG increased close to the ceiling with an increase of 6.7%; LHG, DXS, KHG codes all increased by over 5-6%. Liquidity of real estate stocks skyrocketed. DXG matched more than 21 million units, PDR matched approximately 19 million units, KHG matched more than 12 million units...

Why is Novaland's Aqua City project stalled? In addition to the lack of agreement on social housing land funds, the lack of consistency between plans is the reason why Novaland's Aqua City project is still unfinished.

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