VietNamNet Bridge – Vietnamese businesses had never before
faced so many difficulties as in 2012. The stories about the enterprises
incurring loss or getting bankrupt were so popular that they did not surprise
anyone.
Trillions of dong in capital, no dong in turnover
In late July 2012, Sudico (SJS),
an urban area development company announced the loss of 5.6 billion dong by the
end of the first half of 2012, while it made a profit of 25 billion dong in the
same period of the last year.
The reported loss then shocked
SJS shareholders, who could not imagine that a big corporation with the
stockholder equity of over 1.7 trillion dong did not make any dong.
The information then made SJS
prices tumble dramatically from 35,000 dong per share to 17,000 dong per share
in late November.
Though SJS’ shareholders keep
buying SJS shares, the total market capitalization value of the enterprise
decreased by 2 trillion dong in 2011 to 3 trillion dong and then to 2 trillion
dong by the end of November 2012.
In the mining industry, investors
also feel shocked because they cannot understand why so many enterprises have
reported losses, when mining is considered a sector with great potentials. BGM,
a mining joint stock company in Bac Giang province, did not have turnover in
the first half of 2012
No turnover or low turnover was
the common problem of many Vietnamese enterprises in 2012. Most recently,
Meca-VNECO has reported the modest turnover of 627 million dong in turnover in
the third quarter, a sharp decrease of 86 percent in comparison with the same
period of the last year.
Especially, ITA, a giant in
industrial zone infrastructure development sector, reported the turnover of
minus 223 billion dong for the third quarter.
Owing money right and left, going bankrupt
Having modest turnover, of
course, was not the good news for shareholders. However, this seemed to be
better than bankruptcy or delisting.
Vinaconex, a giant in the
construction industry, caused a shock to the enterprises when it reported the
real net profit of 40.2 billion dong in 2011, which was 10 times lower than the
profit announced before its finance report was audited.
PVX, a construction and
installation corporation, which listed 400 million shares on the bourse in
early September 2012, unexpectedly reported the huge loss and the arrest of
four managers of its subsidiaries.
PVX had always been a blue chip
share on the Hanoi Stock Exchange until the day the information was released.
After the enterprise reported the post-tax profit of minus 334 billion dong by
June 30, 2012, PVX has been excluded from the list of the shares eligible for
margin trading.
In fact, PVX, like many other
enterprises, made a blunder that it was too hurry to expand business, thus
falling into the “hot growth trap.” Auditors have found out that by June 30,
2012, PVX had been acting as the guarantor for 10 subsidiaries which borrowed
capital from five banks. The total overdue debts of the companies had reached
to 558 billion dong.
The Ministry of Planning and
Investment has reported that 62,794 enterprises had been established by the end
of November 2012 with the total registered capital of 403 trillion dong, while
48,000 businesses got dissolved during the same time. It is estimated that
55,000 businesses would stop operation or get dissolved by the end of the year.
Business & Investment Opportunities
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