DDG stock price plummeted, losing 80% of its value in April alone
Dong Duong Industrial Export Investment Joint Stock Company (Code DDG) was formerly Dong ThanhEducation Development Investment Company Limited, established in 2010 with main activities in the field of design, investment and construction of steam and electricity supply systems.
The stock code DDG has surprised stock investors in the past 2 months by continuously falling sharply, "evaporating" nearly 80% of its value in just 1 short month.
Indochina Import Export (DDG) Chairman and General Director had their shares sold for mortgage (Photo TL).
Specifically, by the end of March, the DDG code was still priced around 42,000 VND/share, with trading volume of hundreds of thousands, with some sessions reaching millions of shares. However, from the trading session on April 7, 2023 to the trading session on May 9, 2023, DDG dropped sharply from 42,200 VND/share to only 6,000 VND/share, equivalent to a decrease of about 86% in just 1 month.
Currently, in the trading session on May 31, 2023, DDG code is being traded at VND 8,800/share, still nothing compared to the price around VND 42,000/share that this code has achieved for a long time.
A series of DDG leaders, including the Chairman and CEO, had their shares sold for mortgage.
With such a deep drop in stock prices, it is not difficult to understand why many company leaders have just had their shares liquidated, including the company's Chairman and CEO.
According to information published at the Hanoi Stock Exchange (HNX), Mr. Nguyen Thanh Quang, Chairman of the Board of Directors of Indochine Imex, had 1.63 million shares sold for collateral. After the transaction, the percentage of shares that Mr. Quang held decreased from 4.95% to only 2.23%, equivalent to 1.3 million shares.
In addition, Board Member and General Director, Ms. Tran Kim Sa, was also notified to sell 700,000 shares. After this transaction, Ms. Tran Kim Sa's holding decreased from 3.84% to only 2.67%, equivalent to 1.6 million shares.
Mr. Tran Kim Cuong, member of the Board of Directors and Deputy General Director, also the younger brother of Ms. Tran Kim Sa, had 210,000 shares sold, reducing his ownership ratio from 3.28% to only 2.92%, equivalent to 1.75 million shares.
First quarter revenue drops sharply, profits from tens of billions drop to several hundred million
The fall in DDG stock price was predicted by many investors when Indochine Imex had an unfavorable business period in the fourth quarter of 2022 and continued into the first quarter of 2023.
In the first quarter of 2023, the company's net revenue was only recorded at VND 159 billion, down only 8% over the same period. However, in the previous 3 consecutive quarters, DDG's revenue continuously reached around VND 250 - 80 billion.
The company's first quarter 2023 profit has even dropped sharply, down to just under VND200 million, while in the same period it was still VND14 billion. Thus, DDG's first quarter profit has "evaporated" by 99% compared to the same period last year.
By the end of the first quarter of 2023, DDG's total assets did not fluctuate much, remaining at VND 1,828 billion. Of which, payables accounted for VND 1,049 billion, equivalent to 57% of total capital. Notably, the company's short-term debt is up to VND 820 billion. These are all bank loans and loans from financial institutions to serve business activities. The company's long-term debt also accounts for VND 119 billion, a slight increase compared to the beginning of the year.
Compared with the current equity capital of 779 billion VND, it can be seen that DDG's short-term debt is higher than equity. This shows a significant risk to the company's capital structure.
Meanwhile, the company's short-term receivables accounted for 640 billion VND. Including 165 billion VND of short-term receivables from customers, which is a source of revenue recorded but only on paper and has not been actually received. Meanwhile, the company had to advance 412 billion VND to short-term sellers, increasing the risk.
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