Deo Ca Group Shareholders' Meeting: Increase capital to over 6,300 billion VND, maintain listing target
Deo Ca Group plans to issue more than 210 million shares (50% of the total issued shares) to existing shareholders to increase capital to more than 6,300 billion VND.
The Deo Ca Group's General Meeting of Shareholders on June 26 approved the entire proposal, with a 2024 business plan of VND 8,956 billion in revenue, an increase of more than 35% and after-tax profit of VND 733 billion, an increase of more than 14% compared to 2023.
At the end of the first quarter of 2024, Deo Ca recorded revenue of VND 1,750 billion, an increase of 121.52% and profit after tax of VND 169 billion, an increase of 39.67% compared to the first quarter of 2023.
Regarding investment activities, Deo Ca has just completed the Cam Lam - Vinh Hao expressway with a total investment of more than VND 8,900 billion, which will be put into operation at the end of April 2024. Two projects are being implemented: Dong Dang - Tra Linh expressway (phase 1) with a total investment of more than VND 14,300 billion (starting construction in January 2024) and Huu Nghi - Chi Lang expressway, with a total investment of more than VND 11,000 billion (starting construction in April 2024).
The leader of Deo Ca Group said that they are continuing to research and invest in projects such as Tan Phu - Bao Loc, Ho Chi Minh City - Chon Thanh, Ring Road 4 through Binh Duong province, Ho Chi Minh City - Trung Luong - My Thuan (phase 2)... with a total investment of nearly 80,000 billion VND, and the Vietnam - Laos railway project, Vung Ang - Mu Gia section , worth more than 47,600 billion VND.
Regarding construction and installation activities, in 2023, Deo Ca completed many projects and packages on schedule such as Thung Thi tunnel on Mai Son - National Highway 45, Truong Vinh tunnel on Nghi Son - Dien Chau highway, My Thuan 2 bridge, My Thuan - Can Tho highway, Prenn pass road expansion, ... with a total participation value of more than 6,100 billion VND.
The Group is continuing to carry out a large amount of work on the North-South Expressway Phase 2 construction site such as the Quang Ngai - Hoai Nhon Expressway, with a total investment of more than VND 20,400 billion.
Along with that is the construction of the expressways Chi Thanh - Van Phong, Tuyen Quang - Ha Giang, Khanh Hoa - Buon Ma Thuot, Ho Chi Minh road section Chon Thanh - Duc Hoa, Ring Road 3 Ho Chi Minh City, Tan Van intersection, 2 routes connecting Long Thanh airport of the Long Thanh International Airport project, Khe Net railway tunnel of the Hanoi - Ho Chi Minh City railway line... with a total implementation value of nearly 15,000 billion VND.
This is an important basis for the Group to come up with the above growth plan, said Mr. Khuong Van Cuong - General Director of Deo Ca Group.
Regarding operation management activities, Deo Ca is currently managing the operation, regular maintenance, ensuring safety and smooth traffic for nearly 410km of expressways and national highways, more than 30km of road tunnels and managing 18 BOT toll stations nationwide.
According to the leader of Deo Ca Group, to participate in investing in nearly 400km of highways and railway projects in the context of limited resources, Deo Ca is at the forefront of innovation, using the PPP++ model to diversify capital sources, increase mobilization efficiency, and minimize risks throughout the project implementation process.
In which, P1++ is budget capital (including central budget capital and local budget capital), P2++ is equity capital of legitimate investors and secondary investors, P3++ is capital mobilized from credit institutions, business cooperation, bonds,...
Besides, human resources are an important factor in the sustainable development strategy of the enterprise.
In order to supplement working capital and investment capital, Deo Ca Group plans to issue more than 210 million shares (50% of the total issued shares) to existing shareholders. Implementation time is in 2024 - 2025 and according to the progress of the projects.
If successful, Deo Ca Group's charter capital will increase from more than VND 4,200 billion to more than VND 6,300 billion.
 |
| Discussion at the Congress |
Discussion at the General Meeting of Shareholders
The Group will propose PPP projects with a total investment of more than 131,000 billion VND. What advantages does Deo Ca have to implement the above projects, especially the highway and railway projects?
Mr. Nguyen Tan Dong - Vice Chairman of the Board of Directors of Deo Ca Group: Deo Ca has experience in implementing large projects, typically the Bac Giang - Lang Son and Trung Luong - My Thuan expressway projects... despite many challenges, the Group still performed well and ensured progress.
The Group has invested in many machines and equipment and has fully depreciated them, so there is good price competition. The staff is well-trained, cooperates with schools for training, and cooperates with the University of Transport to open a second degree class on railway and metro topics.
Recently, the group entered into a railway project, a joint venture with a Korean partner - thereby gaining more experience for future projects.
In 2023, the company paid a 4% dividend, this year it is 8%, can the company guarantee it?
Mr. Nguyen Huu Hung, Vice Chairman of the Board of Directors of Deo Ca Group: in 2023, the Group's initial target was 7%, but Deo Ca only paid 4% to continue participating in bidding and participating in projects in the third quarter, such as the Ring Road 4 project from Ho Chi Minh City to Binh Duong; Dau Giay - Tan Phu project, Ho Chi Minh City - Chon Thanh... due to the nature of this industry, it is necessary to demonstrate great financial capacity.
In 2024, with the remaining accumulated profits, the Board of Directors is confident that it will ensure dividends are paid according to plan.
Does Deo Ca Group have a roadmap to go public?
This is the goal set by the Board of Directors, within the 5-year strategy. In the past 2-3 years, it has not been a good time for transport infrastructure enterprises, facing many continuous difficulties such as Covid, interest rates, and fluctuations in material prices, making the transport infrastructure profit margin relatively thin. Therefore, the Board of Directors has chosen that in 5 years, when the opportunity is ripe, the group will ask shareholders' opinions in writing to list on the stock exchange.
How are raw material prices and interest rates affecting the group?
Mr. Nguyen Tan Dong, Vice Chairman of the Board of Directors of Deo Ca Group: Due to the characteristics of the transport infrastructure industry, the fluctuation rate of actual market material prices increases faster than the price of State-managed materials - leading to difficulties in controlling prices and costs.
The management realized and controlled very fundamentally, limiting the impact of the market. Steel and plastic prices fluctuated, Deo Ca worked in advance with major suppliers to sign long-term contracts at reasonable prices. Worked with investors, state agencies, and localities to make appropriate adjustments when there were price fluctuations.
Regarding interest rates, the transport infrastructure sector uses a large amount of borrowed capital (mostly borrowed from State banks), fluctuations in bank interest rates have been low in the past 6 months, although they have increased in the past, from now until the end of the year, State banks will not change much, so it will not affect the Company.
To reduce the impact of interest rates, Deo Ca uses a variety of capital sources, instead of equity and loans as before, now there is also budget capital, business cooperation, bonds, increasing the scale of equity... We consider credit institutions as service providers, so we choose partners with the best and most suitable services.
In the past, in addition to commercial banks, for large-scale projects we worked with policy banks such as VDB with credit limits and interest rates suitable for the infrastructure sector.
Assessment of public investment disbursement situation, and specifically for Deo Ca projects?
Mr. Nguyen Tan Dong, Vice Chairman of the Board of Directors of Deo Ca Group: The Deo Ca projects participating as contractors are all key, with priority from the Government and competent authorities - a favorable factor, so the progress of public investment disbursement to promote the project is of great concern.
To disburse, two main factors are required: output and procedures to promote disbursement. With output, the group has overcome the most difficult stage, which is the site clearance stage in the Ring Road 2 project and solved the problem of raw material prices. The company's projects are all having good output.
At the same time, competent authorities also regularly hold meetings with enterprises to update the situation, monitor and promote periodic disbursement, so disbursement activities at the Deo Ca project are all good.
Comment (0)