Some investors said that only when the economy fell into difficulties, did they realize which enterprises do real business and earn real profits.
On the stock trading floor, some real estate enterprises with a capital of trillions of Vietnamese were continuously flooded in red, the price of a share was cheaper than that of a bunch of vegetables. For instance, Quoc Cuong Gia Lai Joint Stock Company with the stock code QCG has an equity capital of up to more than VND4.27 trillion, of which, its charter capital is VND2.75 trillion, but the price of its shares is always lower than the par value and now is standing at just VND6,000 per share. Despite its huge capital, the company’s profit was low. Last year, the company’s pre-tax profit was merely VND78 billion and after-tax profit was VND58.5 billion.
Similarly, Hoang Anh Gia Lai Joint Stock Company (HAG) has an equity capital of VND12.08 trillion, of which charter capital is more than VND9.27 trillion, but for many years the stock price is only around VND4,000 per share. Business activities of this enterprise in 2019 suffered a loss of more than VND700 billion.
State-owned enterprises with large equity capital did not have good business performance either. Specifically, Investment and Trading of Real Estate Joint Stock Company (ITC) used to have its glorious days, but according to the financial statements, this enterprise has equity capital of more than VND1.66 trillion, of which, charter capital is VND690 billion, and profit after tax is also just over VND110 billion.
Currently, many other real estate companies with trillions of Vietnamese dong of capital have also encountered difficulties amid the pandemic from the beginning of the year to now. Sales and profits were extremely low compared to equity. Certainly, the tremendous consequences will be shown in the financial statements at the beginning of next year. To survive and attract capital, real estate companies have switched to corporate bond channels recently.
Many enterprises are willing to pay commissions to issue bonds at a very high rate, therefore, at banks, the bond issuance channel for businesses is considered one of the main sources of income from services that bring high returns. Some banks set up an advisory room or a sales department for securities and bonds and assigned their employees to lure customers. After knowing which customers have idle money, instead of saving money with low-interest rates, they will entice customers to buy these risky corporate bonds. Most of the small retail customers, who are not financially savvy, listened to their solicitation of high-interest rates, have invested in corporate bonds.
While the real estate enterprises have sunk deeply, the manufacturing companies, especially the food manufacturing industry which usually posts stable profits by nature, are now rising amid the pandemic. Typically, Cholimex Food Joint Stock Company with the stock code CMF on the UpCoM has an equity capital of only VND450 billion, of which charter capital is VND81 billion, but its total revenue is VND2.2 trillion dong, pre-tax profit in 2019 was up to VND208 billion, and after-tax profit was VND166 billion. Profit for the year was 2.5 times higher than the charter capital. Therefore, at the General Meeting of Shareholders in 2020, CMF paid dividends at the rate of up to 50 percent per par value, an increase of 66.7 percent over the previous year.
Tuong An Vegetable Oil Joint Stock Company (TAC) also does business in the essential food sector, so right after the outbreak of Covid-19, the company has boosted production. In the first seven months of the year, TAC's net revenue exceeded VND2.61 trillion, up 30 percent compared to 2019, and its seven-month gross profit was more than VND370 billion, up 23.3 percent compared to the same period last year. Therefore, TAC's stock price from the beginning of the year to now has increased by nearly 50 percent, currently is trading at over VND36,000 per share.
KIDO Frozen Food Joint Stock Company (KDF) achieved the revenue in the first seven months at VND832 billion, and its pre-tax profit increased by 21 percent. Within just seven months, it has fulfilled 94 percent of its pre-tax profit target for the whole year. Grasping the demand of consumers that due to the pandemic, people limited direct contact and going out, enterprises have brought products to consumers personally, thereby boosting sales.
The most profitable enterprises during the pandemic are probably face-mask producers. Only since May, Wakamono Vietnam Joint Stock Company announced the information about antimicrobial fabric using Biotech nanotechnology to produce medical masks and protective clothing, immediately the company's factory has been running at full capacity of about 20 tons of this kind of fabric per day to meet the needs of its partners. The next is food companies. Saigon Food Company received an increase of 40 percent in the number of orders of frozen food in March and April.
The fresh processed dishes, such as fried rice, chicken glass noodle, rice noodle soup, crab vermicelli, and pasta, increased by up to 70-80 percent compared to the time before the pandemic. Even though they are frozen products, many items were still out of stock. Another type of high-profit service is online selling businesses. During the pandemic, people restricted going out, so they preferred to buy and sell online. The Saigon Food Company said that the online sales channel increased by 24 times compared to before the pandemic. Other companies such as The Gioi Di Dong also increased their online sales services, bringing in huge revenue and increasing profits.
On the stock trading floor, some real estate enterprises with a capital of trillions of Vietnamese were continuously flooded in red, the price of a share was cheaper than that of a bunch of vegetables. For instance, Quoc Cuong Gia Lai Joint Stock Company with the stock code QCG has an equity capital of up to more than VND4.27 trillion, of which, its charter capital is VND2.75 trillion, but the price of its shares is always lower than the par value and now is standing at just VND6,000 per share. Despite its huge capital, the company’s profit was low. Last year, the company’s pre-tax profit was merely VND78 billion and after-tax profit was VND58.5 billion.
Similarly, Hoang Anh Gia Lai Joint Stock Company (HAG) has an equity capital of VND12.08 trillion, of which charter capital is more than VND9.27 trillion, but for many years the stock price is only around VND4,000 per share. Business activities of this enterprise in 2019 suffered a loss of more than VND700 billion.
State-owned enterprises with large equity capital did not have good business performance either. Specifically, Investment and Trading of Real Estate Joint Stock Company (ITC) used to have its glorious days, but according to the financial statements, this enterprise has equity capital of more than VND1.66 trillion, of which, charter capital is VND690 billion, and profit after tax is also just over VND110 billion.
Currently, many other real estate companies with trillions of Vietnamese dong of capital have also encountered difficulties amid the pandemic from the beginning of the year to now. Sales and profits were extremely low compared to equity. Certainly, the tremendous consequences will be shown in the financial statements at the beginning of next year. To survive and attract capital, real estate companies have switched to corporate bond channels recently.
Many enterprises are willing to pay commissions to issue bonds at a very high rate, therefore, at banks, the bond issuance channel for businesses is considered one of the main sources of income from services that bring high returns. Some banks set up an advisory room or a sales department for securities and bonds and assigned their employees to lure customers. After knowing which customers have idle money, instead of saving money with low-interest rates, they will entice customers to buy these risky corporate bonds. Most of the small retail customers, who are not financially savvy, listened to their solicitation of high-interest rates, have invested in corporate bonds.
While the real estate enterprises have sunk deeply, the manufacturing companies, especially the food manufacturing industry which usually posts stable profits by nature, are now rising amid the pandemic. Typically, Cholimex Food Joint Stock Company with the stock code CMF on the UpCoM has an equity capital of only VND450 billion, of which charter capital is VND81 billion, but its total revenue is VND2.2 trillion dong, pre-tax profit in 2019 was up to VND208 billion, and after-tax profit was VND166 billion. Profit for the year was 2.5 times higher than the charter capital. Therefore, at the General Meeting of Shareholders in 2020, CMF paid dividends at the rate of up to 50 percent per par value, an increase of 66.7 percent over the previous year.
Tuong An Vegetable Oil Joint Stock Company (TAC) also does business in the essential food sector, so right after the outbreak of Covid-19, the company has boosted production. In the first seven months of the year, TAC's net revenue exceeded VND2.61 trillion, up 30 percent compared to 2019, and its seven-month gross profit was more than VND370 billion, up 23.3 percent compared to the same period last year. Therefore, TAC's stock price from the beginning of the year to now has increased by nearly 50 percent, currently is trading at over VND36,000 per share.
KIDO Frozen Food Joint Stock Company (KDF) achieved the revenue in the first seven months at VND832 billion, and its pre-tax profit increased by 21 percent. Within just seven months, it has fulfilled 94 percent of its pre-tax profit target for the whole year. Grasping the demand of consumers that due to the pandemic, people limited direct contact and going out, enterprises have brought products to consumers personally, thereby boosting sales.
The most profitable enterprises during the pandemic are probably face-mask producers. Only since May, Wakamono Vietnam Joint Stock Company announced the information about antimicrobial fabric using Biotech nanotechnology to produce medical masks and protective clothing, immediately the company's factory has been running at full capacity of about 20 tons of this kind of fabric per day to meet the needs of its partners. The next is food companies. Saigon Food Company received an increase of 40 percent in the number of orders of frozen food in March and April.
The fresh processed dishes, such as fried rice, chicken glass noodle, rice noodle soup, crab vermicelli, and pasta, increased by up to 70-80 percent compared to the time before the pandemic. Even though they are frozen products, many items were still out of stock. Another type of high-profit service is online selling businesses. During the pandemic, people restricted going out, so they preferred to buy and sell online. The Saigon Food Company said that the online sales channel increased by 24 times compared to before the pandemic. Other companies such as The Gioi Di Dong also increased their online sales services, bringing in huge revenue and increasing profits.
