Dragon Capital increases ownership in Vinaconex by over 7%

Dragon Capital fund group has purchased over 4.5 million shares of Vinaconex, the Vietnam Export-Import and Construction Corporation.

Dragon Capital increases ownership in Vinaconex by over 7%
Photo by Carlos Muza / Unsplash

According to the Ho Chi Minh City Stock Exchange, on January 23, 2024, member fund Amersham Industries Limited bought 1.5 million shares, CTBC Vietnam Equity Fund bought 1 million shares, and Vietnam Enterprise Investments Limited bought 2 million shares.

After the transaction, the group's ownership increased from 36.73 million shares (6.87%) to 41.23 million shares (7.71%). On January 23, VCG shares recorded over 2.5 million units traded at an average price of 25,760 VND/share.

Dragon Capital had previously become a major shareholder of Vinaconex after purchasing 1.3 million VCG shares on November 2, 2023, increasing ownership from 25.78 million shares (4.82%) to 27.08 million shares (5.06%). Since becoming a major shareholder, the foreign fund group has purchased an additional 14.2 million VCG shares, increasing ownership to 7.71% at present.

In the market, VCG shares have been trading sideways within an upward price range for the past two and a half months. As of the close of January 25, the share price was at 25,250 VND/share with a total trading volume of over 5.6 million units.

Vinaconex has not yet announced its financial report for Q4/2023. According to the financial report for Q3/2023, in the first nine months of 2023, the construction contractor recorded a total net revenue of 8,915 billion VND, up 33% compared to the same period last year, but net profit was only 204 billion VND, down 79%, due to low gross profit margin.

According to the assessment of Techcombank Securities (TCBS) in a recent report, Vinaconex's Q4/2023 and 2024 business results will be optimistic thanks to the handover of the Green Diamond 93 Lang Ha real estate project in Hanoi. The company is also the selected contractor to participate in the construction bidding packages of the East-West North-South Expressway (Phase 2) project, including the Vung Ang - Bung sections, Van Phong - Nha Trang, Bai Vot - Ham Nghi, Tuyen Quang - Ha Giang expressway, the construction investment project of the Capital Beltway 4, and many other important projects.

TCBS believes that Vinaconex's financial situation is quite good. The valuation of VCG shares is reasonable with a projected P/E ratio of about 13 times (compared to the industry's median P/E ratio of 18 times over 3 years).


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