Financial revenue - a bright spot for real estate enterprises
- 122
- Enterprise
- 20:30 14/08/2024
DNHN - Financial revenue in the second quarter of 2024 has been an important bright spot, helping many real estate businesses maintain positive profits despite challenges from their core business activities, contributing to their financial stability.
In the first half of 2024, the real estate market witnessed encouraging recovery, with the launch of many new housing projects and a transaction rate exceeding 70%. Apartment prices in the two major cities of Hanoi and Ho Chi Minh City continuously set new record highs. According to a report from the Vietnam Real Estate Brokers Association, the primary market successfully saw 20,600 housing units transacted, three times more than in the same period last year.
However, even though the market has passed through a difficult phase, many challenges still remain. Despite signs of recovery in the macroeconomy, real estate businesses continue to face financial health difficulties, slow policy resolution, and unclear future prospects. The Q2 2024 financial reports of many real estate companies show that financial revenue plays a crucial role in maintaining positive profits, even though the overall situation remains challenging.
Amidst the difficulties faced by the real estate market, financial revenue has emerged as a prominent bright spot for many real estate businesses. This primarily stems from financial revenue providing a stable income source, helping these companies overcome challenges from their core business activities. For instance, profits from investments, share transfers, or lending often bring significant returns, offsetting the decline in revenue from real estate sales.
Many real estate enterprises, such as Binh Duong Business and Development JSC and Nam Long Investment Corporation, have taken advantage of financial opportunities to maintain financial stability. The strong increase in financial revenue has helped them improve their operational results while the main market faces difficulties. Specifically, profits from investments or asset transfers can yield gains even when primary sales revenue declines, highlighting the crucial role of this income source in maintaining the financial sustainability of companies.
Moreover, financial revenue helps real estate businesses maintain liquidity and the ability to continue operations during difficult times. With revenue from financial activities, companies can improve their financial situation, invest in new projects, or sustain the operation of current projects without relying entirely on real estate sales revenue. Thus, financial revenue not only helps real estate companies get through tough periods but also creates opportunities for recovery and sustainable development in the future.
Notably, Phat Dat Real Estate Development Corporation (HoSE: PDR) is another example of reliance on financial revenue. PDR's net revenue in Q2 2024 was only 8.25 billion VND, but the company recorded a net profit of 49.7 billion VND thanks to financial revenue, especially from the transfer of linked shares, which amounted to nearly 202.5 billion VND.
The Vietnam Exhibition Fair Center (VEFAC, UPCoM: VEF), a subsidiary of Vingroup, also relies on financial revenue to sustain its operations. In Q2 2024, VEFAC reported financial revenue exceeding 148 billion VND, primarily from lending and investment profits. As of the end of the first six months, total revenue reached 545 million VND, with post-tax profits of over 200 billion VND.
Other cases, such as Novaland Investment Group Corporation (HoSE: NVL) and An Gia Real Estate Investment and Development Corporation (HoSE: AGG), also show reliance on financial revenue in recent times.
According to an analysis by Yuanta Vietnam Securities Corporation, the cash flow of many real estate companies is still negative due to difficulties in clearing inventory. Companies often have to divest or transfer assets to improve cash flow. The recovery of the real estate market and the effective implementation of policies are necessary to promote positive changes in the industry.
Therefore, the ability of real estate companies to raise capital remains limited. Although the corporate bond market showed signs of improvement in Q2 2024, bond issuance still faces challenges due to investor confidence not yet fully recovering.
Nhan Ha
Related news
#real estate enterprises
Real estate businesses and macroeconomic challenges
The year 2024 marks a challenging period for real estate businesses, not only in Vietnam but also worldwide.
Dr. Tran Xuan Luong: Real estate businesses lacking resources will be eliminated from the game
Dr. Tran Xuan Luong believes that real estate businesses that lack resources and strategy will certainly struggle to survive in the current competitive environment.
Resort real estate: The path out of the "dark zone"
Resort real estate can overcome the "dark zone" by enhancing customer experience, maintaining and upgrading infrastructure, developing diverse amenities, and implementing effective marketing strategies.
Rental real estate market: Investment potential and legal regulations
This information was presented at the seminar "Rental real estate business: Legal and practical issues" organized by the Vietnam Lawyers Journal on July 5 in Hanoi.
MoC proposes controlling bond issuance of property firms
The Ministry of Construction (MoC) has proposed controlling the bond issuance activities of real estate enterprises but not tightening investment in real estate bonds, Nguyen Manh Khoi, Deputy Director of MoC's Housing and Market Management Department, said at the monthly press conference held on June 13.
Thaigroup appoints 8x generation female CEO
Thaigroup Corporation has recently announced the appointment of Ms. Bui Thai Ly as the CEO, effective from June 12, 2024.
Đọc thêm Enterprise
Real estate businesses and macroeconomic challenges
The year 2024 marks a challenging period for real estate businesses, not only in Vietnam but also worldwide.
VINASME and VISA collaborated to promote financial solutions for small and medium-sized enterprises
On September 10th, at the Government Office Conference Center, the VINASME and the international card organization VISA will co-host a seminar titled "Payment and Financial Solutions for Small and Medium-sized Enterprises".
Hòa Phát Group leaders receive major pay hike during steel market crisis
Although the global steel industry is experiencing a crisis, Hòa Phát recorded a sharp increase in executive remuneration in the first half of 2024, with costs rising 3.4 times compared to the same period last year, reaching VND 112 billion.
Ho Chi Minh City: Economic recovery, yet the number of businesses exiting the market remains high
In the first eight months of the year, the number of businesses entering the market increased by 8.8%, but the number of businesses withdrawing also rose by 7.4%.
Businesses are the main actors and the greatest drivers of innovative startups
Dr. Đàm Quang Thắng – Chairman of the National Innovation Advisory Council has provided deep insights into the role of businesses within the innovative startup ecosystem.
General Secretary and President Tô Lâm: "Although it is a small and medium-sized business community, it is very large..."
On the afternoon of August 22, General Secretary and President Tô Lâm received a delegation of the Vietnam Association of Small and Medium Enterprises. This important and meaningful event was organized by the Business and Integration Magazine.
BIDV financed the construction of Cap Saint Jacques Complex in Vũng Tàu City
The signing ceremony for the credit contract to finance the project was organized by BIDV and the Development Investment Construction Joint Stock Corporation (DIC) — the project's investor — in Ho Chi Minh City on August 19, 2024.
The Vietnam Association of Small and Medium Enterprises honors an audience with the General Secretary and President Tô Lâm
On the afternoon of August 22, the VINASME will have the honor of meeting with the General Secretary and President Tô Lâm to report on the results of their activities. This significant event is organized by the Business and Integration Magazine.
Dr. Tran Xuan Luong: Real estate businesses lacking resources will be eliminated from the game
Dr. Tran Xuan Luong believes that real estate businesses that lack resources and strategy will certainly struggle to survive in the current competitive environment.
Tight control on foreign borrowing, businesses face more difficulties
Since 2022, borrowing foreign capital without government guarantees has become more difficult, and according to feedback from many businesses, part of the reason is the tight control policies on foreign borrowing from the State Bank of Vietnam.