Duc Giang chairman regrets listing on Ha Noi exchange

Saturday, Jul 25, 2020 07:51

Workers of Duc Giang Chemical Group JSC (DGC) pack products in the Ha Noi-based factory. The company specialises in washing powder production and is wel-known for its Duc Giang-branded washing powder. — Photo the courtesy of Duc Giang

Moving its listing from the Ha Noi Stock Exchange (HNX) to the Ho Chi Minh Stock Exchange (HOSE) would help Duc Giang Chemical Group (DGC) increase its trading liquidity, according to its chairman.

“Listing here (HoSE) would help Duc Giang increase trading liquidity, thus attracting more capital investment from funds. Some have expressed their intention to buy 20-25 per cent of Duc Giang” said Dao Huu Huyen, Chairman of DGC.

“Our decision of listing shares on the HNX in the beginning was wrong as Duc Giang was qualified enough to list on HOSE at the time. Now we have to follow hundreds of procedures for the move,” Huyen said at a conference held early this week in HCM City.

Duc Giang Chemical Group JSC, formerly known as Duc Giang Chemical Company, is a State-owned enterprise under the Viet Nam General Department of Chemicals, established in 1963.

It specialises in washing powder production and is well-known for its Duc Giang-branded washing powder.

In August 2014, the company registered its shares on the HNX with a volume of 33.5 million shares. The stock closed the first session at VND18,740 per share, now they cost some VND40,000 per share.

It has filed for listing on the HOSE with a registered volume of more than 129 million shares, from July 28 at the reference price on the first trading day of VND39,700 per share.

Profit forecast

Duc Giang forecast revenue of more than VND1.6 trillion (US469 million) in the third quarter, and after-tax profit of VND210 billion.

The company plans to spend VND50 billion for the site clearance of the Apatit-Field 25 Mining Project in the northern province of Lao Cai and complete all mining licences in August. The project is expected to be exploited from September. The company will also spend VND116 billion for site clearance of the Duc Giang Nghi Son project in the central province of Thanh Hoa, which is expected to break ground in October.

In the first half of 2020, the company's net revenue exceeded VND3 trillion, up 24 per cent year-on-year. Pre-tax profit reached VND690 billion, up 56 per cent compared to the first half of 2019.

During the first half this year, revenue from financial activities doubled to nearly VND60 billion. Selling and administrative expenses increased sharply by 55 per cent and 33 per cent.

Post-tax profit increased sharply from VND280 billion to VND444 billion in the first six months, up by nearly 60 per cent year-on-year.

In 2020, Duc Giang plans to achieve revenue of VND6.08 trillion, up 20 per cent compared to 2019.

According to its chairman, after 2021, the group will call for investment in the second phase of the Nghi Son project.

The Nghi Son project, set to be completed in 2026, is only the first stage in the group's 10-year vision, said the chairman, adding that the group was taking the first steps to apply to mine in the Central Highlands.

Duc Giang needs an estimated VND10 trillion for its investment plan. Currently, the company has about VND1.5 trillion in bank deposits. It is expected to issue shares worth VND2.5 trillion for shareholders and individual investors. Accumulated profit for the next five years is expected to be more than VND4 trillion. It will borrow the other VND2 trillion from banks. — VNS

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