A series of shares of real estate companies increased ceiling recently, causing many investors to question the suspected driver. It’s hard to understand, the company has no projects and poorly done but stocks still rise.
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Over the past year, Thu Duc Housing Development Corporation has not started any projects. However, in the last 3 months, TDH shares of this company has increased continuously. Three months ago, TDH shares were trading at around VND8,000 / share and now it is trading at VND13,400 / share.
The most worrying thing is the equity of TDH about VND1,670 billion, the short-term debt has reached VND728 billion. Long-term debt is VND296 billion. How will TDH rotate cash flow to pay VND728 billion in the coming time?
LDG’s LDG is currently trading at around VND9,200 / share. This is a young real estate company, mainly developing land in Dong Nai, Binh Duong and Phu Quoc. At present, most of LDG’s projects are unfinished.
Owning 800 hectares of land, LDG’s projects are located in the province and are difficult to sell. For example, Giang Dien eco-villa area, The Viva City project, Sakura Valley residential area, Grand World project … are very slow liquidity.
On November 30, 2016, LDG shares were trading at around VND 4,900 / share, now it has soared to VND9,130 / share. It is worth mentioning, the inventory and liabilities of LDG are huge.
Specifically, LDG has total assets of over VND2,805 billion, equity of approximately VND1,180 billion. But the inventory has accounted for more than 1.080 billion. Accounts payable up to VND1.625 billion.
As such, LDG’s liabilities are VND545 billion higher than equity. In particular, short-term debt of nearly 665 billion, accounting for more than 50% of equity long-term debt of more than VND961 billion. In 2015, short-term debt of LDG is only VND248 billion.
Established more than 10 years, but Dream House Investment JSC has no project was built, except for D-Vela in District 7 just in the end of February last. A series of projects that Dream House has “won” the land is in the “blanket” status.
However, on the HOSE, DRH code of the House Investment Company Dream House has increased the speed. On August 30, 2016, DRH trading at around 17,300 per share is now 25,450 per share.
Similarly, LCG shares of Licogi 16 have risen more than 100% in value over the past three months. From the price of VND4,000, LCG is trading at VND8,300 per share.
After a heavy loss in 2013, LCG started to recover in business after-tax profit from 2014 up to now. However, many investors think that the recent sharp rise of LCG stock is mainly due to the expectation of a rebound from the bottom of the business.
In addition, expectations also come from the warming of the real estate market and construction. The business situation of LCG is not bright enough.
In addition, a number of stocks such as CII of Ho Chi Minh City Infrastructure Investment Joint Stock Company, HBC of Hoa Binh Construction and Real Estate Corporation, DXG of Dat Xanh Group … continuous ceiling price recently.
In fact, stocks are an investment channel for buyers and a channel for raising capital for businesses. In the short run, everything can happen to stock prices driven by supply and demand. However, in the long run, price growth dynamics must go hand in hand with the growth of revenue and profit coming from the core business.
“The real estate stocks gained momentum in recent years are Penny stock – shares worth less than $5. The leaders of these companies are afraid of being taken over so they have to collect their own shares to increase their shareholding. At the same time, business owners also want to increase purchasing power so the price of real estate market price may continue to go up, “a securities expert explained.
Meanwhile, other investors said that a series of enterprises did not implement the project, the business results are low because the companies put money to the stock exchange. This pushes the stock market into a black-and-white gamble as the ups and downs of stocks are not dependent on trading but by the manipulation of the stock exchanges.
In addition, the property market in 2017 is also risky when the credit capital from banks will be reduced by tightening credit from Circular 06 for real estate. At present, credit is always considered a decisive factor to develop the property market.
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