Duc Giang Chemicals boss shows off "mountain" of cash, tells story of stock market losses

At the shareholders' meeting, when asked to buy more shares, Mr. Dao Huu Huyen, Chairman of the Board of Directors of Duc Giang Chemicals, said he had no intention of buying shares because he did not want his family to control the shares.

Duc Giang Chemical Group Joint Stock Company (stock code: DGC) held its 2023 annual shareholders' meeting on March 29th in Ho Chi Minh City. This year's meeting was held at the Independence Palace. At the beginning of the session, Mr. Huyen led the singing of the song "Springtime in Ho Chi Minh City".

The General Meeting approved a plan for consolidated total revenue of VND 10,875 billion and after-tax profit of VND 3,000 billion, representing decreases of 25% and 50% respectively compared to 2022.

According to Chairman of the Board Dao Huu Huyen, setting a low profit target is one of the precautionary measures for the declining price of yellow phosphorus in the market. With this target, the businessman expects to distribute dividends to shareholders in 2023 at a rate of 30%.

Chairman of the Board: Regarding buying back shares, I'm currently also at a loss.

Participating in the discussion at the general meeting, a shareholder said that he had bought DGC shares at the price of 140,000 VND/share, borrowed on margin and was still holding them. According to this shareholder's observation, there is a trend of foreigners selling DGC, causing the shares to not increase to their true value. The shareholder suggested that the board of directors invest and buy more DGC shares so that shareholders can feel secure in holding them.

Regarding this issue, Mr. Huyen said: "Our job is to ensure production and business and ensure the lives of our staff. We do not interfere with foreign investors and do not solve the sadness of shareholders. We all know that the stock market is volatile and no one thought that liquidity would decrease so sharply."

Mr. Dao Huu Huyen, Chairman of the Board of Directors of Duc Giang Chemicals (Photo: IT).

"We don't understand foreign investors. They once inquired about buying 20% ​​of DGC, but we refused. As for buying shares, I'm currently losing money. I can't fight the market alone," he added.

Sharing further at the general meeting, Mr. Huyen stated that there is no plan to buy back shares because he does not want his family to control the company's shares, and he may sell them when appropriate. He noted that for many large corporations worldwide , shareholders like Duc Giang holding 5-10% of the company's capital are already considered significant.

There is still 9 trillion VND in cash.

Another positive sign, according to Mr. Huyen, is that despite having paid out over 1,000 billion VND in dividends as per the Board of Directors' resolution, the group still has nearly 9,000 billion VND in cash. It is rare for a company to accumulate such a large amount of cash, and this will serve as a basis for investing in projects such as the Nghi Son project and the Dak Nong NPK project.

According to the plan outlined for 2023, the company expects to invest a total of 550 billion VND in basic construction, including 50 billion VND for the completion of the Dak Nong NPK plant and 500 billion VND for the commencement of the Duc Giang Nghi Son Chemical Complex.

It is known that the Nghi Son project phase 1 is behind schedule. Explaining this, Mr. Dao Duy Anh, General Director, said that with the Nghi Son project, the delay is due to the fact that some residents in the area affected by 1,000 m to the project have not agreed, so far they have agreed to move out of the affected area. It is expected that by June this year, the people will receive the money and relocate. According to the plan, it will be implemented in the second quarter of 2023. The project has made a big step forward in completing the environmental impact assessment, and it is expected that in April the Ministry of Natural Resources and Environment will approve the final version - a very important license for the chemical project to enter construction.

Another major project is a real estate project in Long Bien, which has received 1/500 scale planning approval, but is currently stalled due to obstacles related to the Housing Law, Land Law, and environmental regulations. The company is coordinating efforts to resolve these issues.

In addition, the group officially announced that it has become the parent company of Tia Sang Battery Joint Stock Company (stock code: TSB), with a 51% ownership stake. The acquisition of this company is not aimed at real estate because the group itself still has 6 hectares of land in Hanoi that it has yet to resolve.

"Our goal is to further boost the development of Tia Sang Battery. We aspire to increase revenue to 1 trillion VND, aiming to leverage Tia Sang Battery's platform to produce lithium batteries – a crucial element for electric vehicles today," Mr. Huyen said.

The company also stated that it is beginning to supply Coca-Cola Global – the world's largest consumer of food-grade phosphoric acid. Additionally, the corporation is exploring the US market due to high demand and supply shortages following trade tensions with China.

At the conclusion of the general meeting, shareholders approved the proposals. Regarding the dividend proposal, there was a consensus that the company would distribute a cash dividend at a rate of 40% for the year 2022.

Source: https://dantri.com.vn/kinh-doanh/sep-hoa-chat-duc-giang-khoe-nui-tien-mat-ke-chuyen-lo-chung-khoan-20230329203242145.htm