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BUSINESS IN BRIEF 30/1
Condo
sales up strongly in HCMC
A
number of real estate service providers on Tuesday released the last quarter
reports for 2013 saying that the number of condos sold in HCMC doubled the
sales figure of 2012.
Savills
The
key factors helping the market run well comprise of a commitment to keep
construction on schedule, prestige of project owners, effective distribution
channels and financial support from developers and associated banks,
according to Savills
Sharing
the same view, CBRE Vietnam noticed that 2013 was the most flexible year in
the last three years as developers had applied all sales promotion methods,
ranging from lengthening payment duration to giving presents and discounts as
rewards for quick payments. Besides, project owners now pay more attention to
advertising and introducing products to woo customers.
An
increase in the condo sales volume indicates the stronger confidence of
project owners in the recovery of the local property market, said CBRE
Vietnam.
The
number of unsold apartments is declining but remains high, at about 17,200
units owing to an oversupply.
The
market in 2014 is expected to change for the better compared to 2013, with
homebuyers projected to continue seeing benefits. Despite this, CBRE Vietnam
believed the situation would depend on other supporting elements such as
reasonable selling prices and suitable products for the market along with
projects with good construction progress.
Amway
Vietnam opens branch in Bac Giang
Amway
How
Kam Chiong, Amway
On the
same day, Amway was honored by the Vietnam Study Promotion Association for
its considerable contributions to education over the past time.
Active
as a multi-marketing-level company, Amway
Amway
Hoa
Sen looks to higher profit
Hoa
Sen Group (HSG) targets to earn an after-tax profit of VND600 billion in the
2013-2014 fiscal year compared to VND581 billion recorded in the previous
fiscal year.
Speaking
at the annual shareholders meeting held on Wednesday in HCMC, chairman of HSG
Le Phuoc Vu said that last year’s high after-tax profit which increased by
58% on year resulted from the company’s anticipation of changes in price of
hot-rolled steel. Therefore, it imported material at a low price, he added.
“Business
results of last year exceeded the targets. The selling volume was 634,000
tons and revenues reached VND11.76 trillion, which rose by 32% and 17%
year-on-year respectively,” Vu said.
“The
export channel also achieved a good result with over 280,000 tons of products
exported to 40 countries and territories, bringing in nearly US$252 million
and helping HSG to secure its position as one of the leading roofing sheet
exporters in Vietnam and Southeast Asia,” he added.
HSG
paid dividend at a 25% rate last year and was among those offering high
dividend rates on the market.
At the
meeting, shareholders also approved the business plan for the 2013-2014
fiscal year, with the selling volume of 700,000 tons of products, VND14
trillion in revenues and VND600 billion in after-tax profit.
HSG
plans to open 15-20 distribution branches and carry out a roofing sheet
project in the northern region to increase the supply capacity. Besides, it
will conduct pre-feasibility studies for local and overseas projects,
establish representative offices or companies in some ASEAN countries as well
as implement the investment plans in
Vinatex
raises investment in yarn, textile projects
Vietnam
National Textile and Garment Group (Vinatex) has increased investment in yarn
and textile projects to grasp export opportunities when
Speaking
at a news conference in HCMC on Wednesday, Le Tien Truong, deputy general
director of Vinatex, said that the group and member enterprises are speeding
up investment in material production projects to raise localization ratios
and added values of apparel products. Under the drafted TPP agreement, the
yarn-forward policy will apply when textile and garment products are shipped
abroad.
Last
year, Vinatex deployed 42 projects with the combined capital of over VND6.3
trillion, including 12 yarn projects, nine textile projects, 17 garment
projects and four others in such fields as infrastructure, supermarket, and
cotton growing. Notably, the group commenced work on Phu Hung yarn plant
project in
To
serve the integration goal, Vinatex will invest around VND5 trillion in
material projects this year, focusing on yarn and textile projects as the TPP
will offer many benefits in the textile, garment, leather and footwear
sectors, Truong said.
Among
12 TPP member countries, the
The
ultimate goal of investment increase is to create and improve the connection
among enterprises of the group, secure a closed process of
yarn-textile-dyeing-finishing. The aim is to help enterprises shift their
business from subcontracting to original design manufacturer (ODM) production
model.
In
2013, Vinatex obtained US$2.9 billion in export value, up 12% against the
previous year, while material imports cost around US$1.2 billion. Therefore,
the group earned around US$1.7 billion in surplus from exports, much higher
than the average ratio of the industry.
In
2013,
Many
international organizations in their 2014 economic outlook reports have
expected economic situation of key apparel export markets of
VietinBank’s
bad debt ratio less than 1%
Vietnam
Joint Stock Commercial Bank for Industry and Trade, or VietinBank, reported
that its bad debt ratio declined strongly to 0.82% by late 2013 with return
on asset (ROA) and return on equity (ROE) standing at 1.45% and 13.9%
respectively.
Its
total assets increased by 14.4% against early 2013 while pre-tax profit was
over VND7.75 trillion, or 3.3% higher than the target approved at the 2013
annual general meeting. The bank’s mobilization rose 11% while lending
increased 14.7% against 2012, VietinBank announced at the conference
deploying 2014’s business tasks in
Last
year, VietinBank paid over VND4 trillion in taxes, entering the list of the
top ten corporate income taxpayers in Vietnam for a fourth consecutive year. The
lender now is the biggest bank in the country in terms of chartered capital
and equity with VND37 trillion and over VND55 trillion respectively.
The
Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU) became the second foreign strategic
investor at VietinBank besides IFC, marking a milestone in the bank’s
international integration process.
Speaking
at the conference, VietinBank Chairman Pham Huy Hung said that the lender
would strive to raise market share in 2014.
Experts:
20% ownership in local banks not attractive
Following
a Government decree allowing a foreign strategic investor to own a maximum of
20% in a local bank, up from 15%, insiders and experts said this new
ownership limit is not attractive enough to lure large investors to the local
banking sector.
Tay
Han Chong, general director of Mekong Development Bank, said that a 20% stake
could not help an investor secure control of a bank. On the other side, a
bank is not willing to give power to a foreign partner with a 20% stake, as
the foreign partner may not devote its efforts to a bank in which it just
holds a 20% stake.
Chong
currently represents a 20% stake of Fullerton Financial Holdings, which is
100% owned by Singapore’s Teamasek Holdings Pte Ltd, at Mekong Development
Bank. An ideal ownership level for foreign strategic investors in a local
credit institution must be over 50%, Chong said.
Nguyen
Xuan Binh, deputy director of analysis and investment consulting unit of Bao
Viet Securities Company, said that the foreign ownership limit increase would
not cause significant impacts on mergers and acquisitions (M&A) in the
banking system in the coming time.
A
strategic investor often wishes to hold a stake of 30% or higher in a
Vietnamese bank to raise its voice over management issues. Other countries in
the region have also applied the 30% ratio, Binh said.
For
the stock market, Binh said the decree will only cause impacts in long term
when foreigners with higher holdings in banks can introduce more changes to
local lenders. In short term, the news is just a temporary psychological
factor.
In
addition, the higher foreign strategic ownership limit in banks fails to meet
expectations of stock investors as they are waiting for foreign room in
listed firms to be lifted to higher than 49%, Binh said.
Therefore,
prices of banking stocks remained normal in previous days and they just
mildly advanced on Tuesday.
In
fact, the new decree just allows for a higher holding ratio for a foreign
strategic partner in a local bank while the maximum foreign ownership in a
single local bank is still capped at 30%, unchanged from the previous ratio.
Earlier,
a foreign strategic investor could not own more than 15% of the charter
capital of a credit institution. In some cases, this rate can be raised to
20% with the Prime Minister’s approval such as stakes held by Mekong
Development Bank and HSBC at Techcombank, Bank of Tokyo-Mitsubishi UFJ at
VietinBank and May Bank at ABBank.
However,
this is still a chance for foreign strategic partners with a 15% stake in
local banks can raise their ownership such as
Consulate-General
Promotions abound for consumers at Tet
As
local purchasing power has started rising for the final days before the Lunar
New Year holiday or Tet, companies are racing to launch numerous promotions
to stir up demand.
Speaking
with the Daily on Tuesday, Phan Linh Phuong, marketing director of
Meanwhile,
Matt Krepsik, a senior executive of Nielsen for Southeast Asia,
However,
the purchasing demand during holidays remains strong. An expert stated that
shopping demand for Tet is always the top concern of local people, which is
considered as a good opportunity for companies to speed up sales.
Khuat
Quang Hung, head of Public Affairs & Corporate Communications General
Management of Metro Cash & Carry Vietnam, informed that his company has
introduced discounts of up to 49% on over 2,000 products for Tet. Metro
centers from now until January 15 will discount prices for multiple items,
with confectionery subject to a discount of 26%, drinks 25%, dried and fresh
foodstuff 29% and clothes up to 49%.
To
lure customers, local firms have also carried out better customer services
such as free delivery and trial product usage.
In
related news, supermarket chains in HCMC have said they will extend opening
times before the Lunar New Year holiday or Tet by opening earlier and closing
later than usual to meet rising shopping demand.
In
particular, from January 20-26, Co.opMart supermarkets in HCMC will open an
hour earlier and close an hour later than normal days, meaning they will be
operating from 7 a.m. to 11 p.m. every day during this period.
From
January 27 to 29, Co.opMart supermarkets will open at 6 a.m. and close at midnight.
On the 30th day alone, they will close at noon.
After
the Tet holiday, which falls on January 31, Co.opMart supermarkets will
resume operation from the second day of the first lunar month, opening at 8
a.m. and closing at noon.
Similarly,
at Big C supermarkets in the city, opening times before Tet are also extended
compared to normal days. The supermarkets from January 23 to 28 will open at
7:30 a.m., half an hour earlier than other days, which will be changed to 7
a.m. from January 29 to 30.
As for
the closing times, customers are able to shop at Big C until 10:30 p.m. from
January 23 to 24, one hour later than normal. Besides, the supermarkets will
close at midnight from January 25 to 26, and at 11 p.m. from January 27 to
29. On the 30th day, the supermarkets will stop operating at noon.
At
Maximark system, the opening hours remain normal, opening from 9 a.m.
However, customers can shop there until 11 p.m. from January 23 to 29 instead
of the usual closing time of 10 p.m. Maximark supermarkets will be back to
business from the eighth day of the first lunar month.
Meanwhile,
Citimart system will close later than usual in the final week before Tet
based on the shopping situation, said general director Nguyen Anh Hoa. “Our
supermarkets will close after the last customer leaves,” she explained.
Mechanization
reduces 20% of sugarcane production costs
Mechanization
in sugarcane farming in line with the method of developed countries might
help reduce up to 20% of sugarcane production costs, said local experts at a
seminar on solutions to sugarcane production in the city on Wednesday.
Nguyen
Van Loc, general director of Bien Hoa Sugar Company, said the application of
mechanization in sugarcane farming might help cut sugar production costs by
up to 20% and increase sugar productivity per hectare by 15-20% compared to
the current method.
The
ASEAN Free Trade Area (AFTA) will be effective in 2015 but the local sugar
and sugarcane industry is still far backward compared to other counterparts
in the region in terms of competitiveness, Loc said. Mechanization of
sugarcane production therefore is the key to improving the competitiveness of
local enterprises, he remarked.
Studies
by experts in the industry indicate that there are many problems in the
process of farming and harvesting sugarcane badly affecting yield and quality
of sugarcane at home. For example, local sugarcane growers set the space
between sugarcane rows at 0.8-1.4 meters while practices elsewhere in the
world set it at 1.8-1.9 meters. With bigger space, local farmer can save on
farming costs while enjoying an increase of 5-10% in productivity, he said.
For
weed control, the combination between mechanization and chemistry will help
cut chemical substance expenses by up to 50% and raise sugarcane productivity
by 15-20%.
Dang
Van Thanh, chairman of Thanh Thanh Cong Group holding stakes at many sugar
companies in the nation, told the seminar that the sugar industry now was
struggling with cheaper Thai sugar smuggled into the country due to the root
cause of the poor sugarcane productivity problem.
Competent
authorities would not face much hardship in fighting smuggled sugar like now
if both sugar plants and farmers could improve sugarcane productivity and
harvesting and production technologies, Thanh noted.
Poultry
meat, egg supplies exceed demands
Livestock
supply is expected to meet market demands during the 2014 traditional Lunar
New Year holiday, or Tet, while poultry meat and egg supplies may exceed
demands prior to the vacation, according to the Livestock Production Department
under the Ministry of Agriculture and Rural Development.
Speaking
at the conference in
Commenting
on the local husbandry industry in 2013, Nguyen Xuan Duong, deputy director
of the department, said there were a lot of difficulties in the year’s first
half as livestock prices tumbled while feed prices soared and enterprises’
stockpiles increased due to the influx of smuggled goods. Enterprises and
farmers suffered losses and reduced investment in the sector.
The
sector also faced huge losses due to diseases while animal health service
fees stood high, accounting for around 5-10% of product values.
Deputy
Minister of Agriculture Vu Van Tam said that domestic husbandry products,
especially meat, will see tougher competition with imported goods in the
coming time because
Participating
in the TPP, the husbandry industry will be the first sufferer, especially
beef and poultry providers.
Domestic
prices are still higher than those in the international market. If local
enterprises fail to prepare for new rules and the Government fails to adjust
development policies, local firms will lose the market to foreign companies,
Tam added.
According
to the department, livestock production has recovered since July, 2013 thanks
to strong consumption and higher sale prices. The nation exports around 6,000
tons of pork to
As of
last October, the nation’s total meat output was estimated to rise by 2.5%
year-on-year.
SOEs
restructuring still at snail’s pace
The
Government’s State-owned enterprises (SOEs) restructuring scheme is still
moving at a snail’s pace as restructured firms have yet to make clear
improvements while eight out of 91 units have yet to present their
restructuring plans to the Government.
The
Government, the Ministry of Finance, the Ministry of Planning and Investment
and the Government Office last year urged SOEs to speed up their
restructuring plans but the restructuring process was still far from the
finish line, said the Ministry of Finance at the summarizing conference in
Four
central SOEs, namely Vietnam Vegetable Oils Industry Corporation, Cuu Long
Corporation for Investment, Development and Project Management of
Transportation Infrastructure, Vietnam Medical Equipment Corporation, and
Vietnam Post Corp., have yet to present their restructuring schemes to
administering agencies. Meanwhile, four companies under
According
to a report of the Finance Ministry, some 83 out of 91 groups and
corporations (excluding 18 corporations under the Ministry of National
Defense) have finished their restructuring plans. Of which, 63 plans,
including 57 of central firms and six of local firms, have been approved.
The
Government has approved plans of 17 firms. Meanwhile, ministries approved
plans by 40 firms and local authorities approved 57 others.
Another
report of the Government showed that as of September 30, 2013, among 109
groups and corporations (including equitized firms in which the State still
holds a majority stake), only 83 units had realized restructuring plans that
had been approved by administering agencies.
Explaining
the slow restructuring, the Government and the Finance Ministry said that
ministries and SOEs have yet to take drastic actions for the restructuring
process. Meanwhile, given the economic recession, enterprises have still met
challenges in business and production while non-core divestment and
equitization have come to a standstill due to hardship of the local stock and
real estate markets.
Petrolimex
posts massive profits behind closed doors
Reporters
were not invited, and those who insisted on entering were politely yet firmly
rejected.
A
representative from the reception board told Tuoi Tre that the meeting was
intended for Petrolimex members only, although the Deputy Prime Minister and
officials from the Ministry of Industry and Trade were in attendance.
A
brief financial report of the company was posted on its website on Monday.
Petrolimex’s
total revenues in 2013 topped VND196.33 trillion (US$9.26 billion), dropping
slightly by 2.25 percent from 2012, according to the report.
However,
its pretax profits surged 97 percent from VND978.17 billion in 2012 to
VND1.93 trillion, or $91.04 million, in 2013.
Profits
from fuel trading activity alone accounted for VND768 billion of the sum.
The
state-run fuel utility increased fuel prices a half dozen times last year. In
all cases, Petrolimex defended the increase by citing a common explanation:
global fuel prices were rising and it would incur losses if prices in
Petrolimex
deputy general director Tran Ngoc
The executive
also noted that Petrolimex earnings should be viewed objectively. Petrolimex
sold as many as 8 million tons of fuel in 2013, and its return on equity
ratio is around 10 percent,
“Petrolimex
only enjoys a modest profit of VND96 per liter of fuel it sells,” he said,
adding that the profit is not so large compared to the company's capital.
Petrolimex
adjusted fuel prices 11 times in 2013, including six cuts and five increases.
Fuel
prices gained VND3,220 per liter, but lost only VND2,160 per liter following
the adjustments.
EVN
throws $5.75 bln into fields outside power sector: state inspectors
The
total investment that the Electricity Group of Vietnam (EVN) has sunk into
sectors other than its core business is as huge as VND122 trillion, or US$5.75
billion, the Government Inspectorate of Vietnam said in a report released
Friday.
The
GIV has been assigned to probe the capital and asset management of the
state-run power utility.
According
to the inspector’s conclusion, EVN has invested nearly VND122 trillion into
the “outside investments,” while its chartered capital is only VND77
trillion.
Nearly
VND2 trillion have been put into the finance, banking, insurance, and
securities sectors, according to the report.
“The
huge disparity of VND45 trillion is against the regulations, while these
non-core investments do not bring economic effectiveness,” the inspectors
concluded.
The
state inspectors also found a number of violations at the EVN subsidiaries.
The
GIV said the Ministry of Industry and Trade has also gone against the
regulation when it allowed EVN to count the VND596 sum to set up an apartment
block as one of the investment expenses of six power supply projects.
EVN
declared the sum was to build the houses to serve the maintenance and repair
tasks for its power projects, while the construction in fact include a series
of villas, apartments, attached houses with features like swimming pools and
tennis courts.
Deputy
general government inspector Ngo Van Khanh said following the inspection
conclusion, EVN must divest from the outside investments.
EVN
and its subsidiaries must also review its operation and provide sanctions on
those responsible.
An EVN
chief told Tuoi Tre on Friday that the company will “strictly follow the
inspection orders.”
Second
SMEs Development program to be approved
The
Government has proposed that the State President approve the Second Small and
Medium-Sized Enterprise Development Program – Subprogram 2, which is financed
by the Asian Development Bank (ADB).
The
Governor of the State Bank of Viet Nam (SBV), authorized by the PM, on
November 22, 2013 signed the Loan Agreement for the program with the
representative of ADB.
Accordingly,
ADB will provide a credit worth US$50 million for
The
program will be monitored by the Ministry of Planning and Investment.
The
program includes 11 policy commitments from the Ministries of Planning and
Investment, Finance, Justice, Labor-Invalids and Social Affairs, Industry and
Trade and the SBV.
It
will support the Government in realizing the Small and
Medium-sized-Enterprises Development Strategy.
Property
firms in upbeat mood
With
positive market developments seen last year, property companies expect the
market to return to a growth path this year.
Last
year saw a pickup in activity at the low-cost housing projects. Good sales
were reported at land lots projects like
According
to a survey of Savills
Talking
about the prospects of the property market, an investor involved in numerous
projects under way in districts 7, 2 and Phu Nhuan said 2014 would be a
defining year for enterprises in the sector.
He
also expected much from the market in the new year. The company is involved
in several major projects and is exploring opportunities to secure land in
convenient locations to serve its long-term business strategy.
Nguyen
Vinh Tran, general director of Nam Long Investment Corporation, said that in
addition to ongoing projects, Nam Long would be developing three more EHome
projects this year. The capital needed for those projects has been arranged
as more than ten local and foreign organizations have recently shown interest
in the issuance of over 25 million NLG shares.
“Housing
demand is still huge. If project investors provide suitable products with
reasonable prices and financial support for customers, they can see good
sales,” Tran said.
Similarly,
Phung Van Nang, general director of Nam Viet Company, is also optimistic
about this year. He said that some low-cost projects distributed by Nam Viet
in last year’s final months sold well, especially small apartments priced at
around VND1 billion a unit. “This segment is promising this year,” he said.
In the
land lot segment, Kim Oanh Company has four projects supplying around 2,000
lots for the market this year, general director Dang Thi Kim Oanh said.
Oanh
said that despite the difficulties faced by the market, the low-cost land lot
segment in Binh Duong and Dong Nai provinces remained liquid. This year the
market may be busier as market conditions are forecast to be more favorable
with the economy improving, interest rates declining and major infrastructure
projects being completed.
Nhon
Trach Investment Company is pinning high hopes on this year. According to
deputy director Phan Thanh Vinh Toan, the opening of HCMC-Long Thanh-Dau Giay
Expressway and forthcoming construction of
“If
there in no change in the last minute, we will launch the first products of
According
to Luu Thi Thanh Mau, general director of Phuc Khang Company, the market now
has favorable factors to make headway.
“The
stable marco economy, interest rates and exchange rate will help the property
market recover and become more attractive to local and foreign investors,”
Mau said.
Mau’s
view sounds sensible. According to a recent report of the Foreign Investment
Agency of the Ministry of Planning and Investment, together with positive
signs of the economy, foreign investors believe in a recovery of the local
property market.
Foreign
direct investment (FDI) capital poured into the property sector was US$884.01
million, helping the sector secure the third position in attracting FDI.
Speaking
at a recent meeting, Deputy Minister of Construction Nguyen Tran
New
expressway hits nearby tollgates’ revenues
The
opening early this month of a stretch of HCMC-Long Thanh Expressway has cut
into revenues of two tollgates on the way between HCMC and Ba Ria-Vung Tau
Province, the operators of the toll stations said.
Many
vehicles traveling between HCMC and Vung Tau now prefer the 20-kilometer
section of the expressway to the longer route via
Tran
Duy Nhan, deputy general director of the Bien Hoa-Vung Tau Expressway Corp.
that operates the Long Thanh Toll Station, said his company’s revenue from
the station has plummeted by one third to VND400 million a day from the
previous VND600 million.
Nhan
predicted the daily revenue would fall further in the coming time when more
transporters opt for the expressway, which is now open to passenger vehicles
and medium-sized trucks only. In addition, once the whole expressway is
completed with an additional section from Long Thanh to Dau Giay, the
station’s revenue would slide strongly.
The
operator of the Hanoi Highway Toll Station is in the same boat, although the
impact is less severe.
Le
Quoc Binh, general director of CII as the tollgate operator, said the firm’s
revenue has fallen, but he declined to give specifics. Binh, however, said
that the impact was not big since the whole expressway project has not been
completed, and vehicles could now run to Long Thanh only.
Data
from the Vietnam Expressway Corporation as owner of the expressway project
show around 8,000 vehicles use the expressway a day, with passenger vehicles
accounting for 80%. The lowest toll fee is VND2,000 a kilometer, meaning at
least VND40,000 for the 20-kilometer section compared to the lowest fee of
VND15,000 charged by the other two toll stations.
Leather
shoe exports aimed at US$11 bil.
The
nation expects to obtain around US$11.3 billion in leather shoe and handbag
exports this year with an average growth rate of 10%, according to the
Vietnam Leather, Footwear and Handbag Association.
Last
year, the industry reported export revenue of US$10.3 billion, rising by 18%
against 2012 and exceeding last year’s target by 3%. Of the figure, exports
of handbags and suitcases hit over US$1.9 billion, while footwear export
value reached US$8.4 billion.
The
This
year, local enterprises will also develop the domestic market, raising the
localization ratio in products to 60-65%. Businesses will also reduce
dependence on material imports by using locally-made products and attracting
investment in material production.
In
2013, material imports for the leather shoe and handbag industry reached
US$3.7 billion, up 18% year-on-year.
In the
near future, local enterprises will face huge challenges when import tariffs
will be lowered to 0% given free trade agreements. When the Trans-Pacific
Partnership (TPP) and a free trade agreement with the EU are realized, local
firms will see tough competition with other member countries due to a lack of
capital, poor production capacity and outdated technologies.
Vietnamese
footwear producers have found it hard to penetrate Eastern Europe, the Middle
East and
Last
year, domestic shoe consumption also fell given competition with sub-quality
imported products. In addition, the nation has yet to control counterfeit and
sub-quality products on the market.
Several
groups earn profits thanks to rising power price
Vietnam
Coal and Mineral Industries Group (TKV), Vietnam Oil and Gas Group and
Vietnam Electricity Group (EVN) reported profits after the electricity price
was adjusted up last year.
According
to TKV, its revenues earned last year from selling 8.5 billion kWh were
VND9.394 trillion, or 2% higher than the target and a rise of 77% over 2012.
The group attributed the better results to electricity price increase to an
average of VND1,498.8 per kWh and coal-fired thermal plants operating
smoothly last year.
Nguyen
Van Bien, deputy general director of TKV, said that selling electricity
helped TKV earn a profit of VND200 billion last year, accounting for 6.6% of
its total profit of VND3 trillion. “If the exchange rate is stable, TKV may
make a higher profit this year,” he said.
According
to Nguyen Sinh Khang, deputy general director of Vietnam Oil and Gas Group,
the group’s subsidiary PV Power generated VND659 billion in profit last year
due to joining the competitive electricity market. The total electricity
volume PV Power sold was 16.16 billion kWh.
Both
TKV and PV Power incurred losses in 2012 as EVN owed debts of electricity
purchases while those selling electricity to EVN had to borrow loans to
maintain their activity. EVN earned VND4 trillion last year and a large
amount of such profit was used to pay debts.
Due to
the rising electricity price, the coal price had been adjusted from August 1,
2013 and followed the market price from this year, ending the prolonged
losses borne by TKV.
SBIC
yet to make gains
Shipbuilding
Industry Corporation (SBIC), successor of the heavily indebted Vinashin, has
yet to gain profits as reported, but its loss has been reduced by VND7.9
trillion after financial restructuring, said SBIC chairman Nguyen Ngoc Su.
Vinashin
had incurred a loss of VND86 trillion as of November, 2010. Therefore, the
news that SBIC obtained a profit of VND7.9 trillion as of the end of 2013 has
raised questions.
SBIC
general director Vu Anh Tuan on December 30, 2013 said that the company’s
revenue was expected at VND5.7 trillion in 2013. So the VND7.9- trillion
profit, which is higher than revenue, is an illogical figure.
Speaking
to the Daily on Wednesday, Su confirmed that SBIC’s 2013 financial statement
was not negative any more while loss was slashed by VND7.9 trillion. If
financial restructuring had not been conducted, SBIC would have had to pay
VND7.9 trillion worth of original debts and interest sums last year.
As
announced by Minister of Transport Dinh La Thang on the website
giaothongvantai.com.vn, SBIC reported over VND24.6 trillion worth of large debts
borrowed from domestic credit institutions before the financial
restructuring. It had foreign debts worth US$600 million and took over US$135
million worth of debts due to contract termination.
However,
SBIC reduced nearly VND22 trillion of original debts and interest sums for
three large loans after conducting financial restructuring, cutting 70% of
domestic debts, 52% of financial obligations from the overseas debt of US$600
million, and VND2 trillion of debts caused by contract termination.
Last
year, SBIC reduced VND7.9 trillion worth of original debts and interest sums,
helping secure capital flow balance, Su said.
In
2014, SBIC targets to earn nearly VND7.6 trillion in revenue but there is no
profit target.
Previously,
the enterprise was asked to obtain around VND11 trillion in revenues to
secure profit for debt payment. However, the Ministry of Transport said that
the figure was unobtainable.
State
agencies requested for concentrated procurement
State
agencies and organizations will have to make concentrated public acquisition
of a large number of commodities rather than making scattered procurements if
the Government gives nod to a proposal on this issue.
The
Ministry of Finance has finished concentrated procurement mechanism and
submitted it to the Government. Accordingly, State-owned units will have to
follow concentrated procurement for a wide range of goods such as
automobiles, office appliances, projectors, audio devices, furniture and stationery.
The
ministry will announce the list of specific goods required for concentrated
public acquisition and revise the list in each period.
Given
this model, a purchasing unit will gather demands for commodities, select
contractors and either directly sign sale contracts with contractors or let
State-owned units to sign such public acquisition contracts.
The
draft on public acquisition aims at securing goods quality, effective
purchase and lawful auctions. Purchases will be made following yearly State
budget estimation with transparency secured.
The
draft also prioritizes online biddings during public acquisition.
The
model has been piloted at the ministry and 24 other agencies under the
Government’s Decision 179, and the concentrated public acquisition has help
cut spending by VND467 billion compared to estimation.
Foreign
retailers face difficulty opening second stores
The
new regulation on setting up the second stores is posing unnecessary
administrative procedure to foreign retailers and making them miss
opportunities, according to HCMC Vice Chairman Le Manh Ha.
Ha
said at a meeting held on Wednesday that the city government would present an
official proposal on the issue to the Ministry of Industry and Trade to
adjust the policy.
According
to Ha, Circular 08/2013/TT-BCT on goods purchasing and relevant activities of
foreign-invested firms in Vietnam which took effect on June 7 requires one
more procedure, which will also cause retailers to waste more time.
Under
the circular’s article No. 7 on opening retail facilities, firms have to
submit the discussion results of the economic needs test (ENT) councils.
The
council consists of the provincial government, the provincial department of
planning and investment or the authority of economic zones, the provincial
department of industry and trade and relevant agencies.
Such a
procedure, according to Ha, is redundant as it is obvious that provinces and
cities have to discuss the matter when considering issuing the licenses of
opening second stores. Requiring firms to present the discussion results is
unnecessary and a waste of time, he said.
Siemens
to commercialize fuel-saving bus project this year
Siemens
Vietnam is pinning high hopes that commercial production of the
energy-efficient buses using the Siemens ELFA hybrid technology will be
translated into reality this year after completing test of the first such bus
prototype.
“Production
of the bus is planned for this year,” Pham Thai Lai, chief executive officer
of Siemens Vietnam, responded to a relevant question raised by the Daily in
HCMC on Wednesday, when he met reporters to provide an overview of the
company in Vietnam in 2013.
The
bus prototype is now being tested on fuel consumption and emission reduction
among others. Lai said that Siemens Vietnam was working with its partner
Vietnam Motors Industry Corp. (Vinamotor) over the project but stressed that
the number of such buses to be manufactured had not been decided.
Siemens
Vietnam has also introduced the environment-friendly bus model to the
authorities of HCMC, the economic hub of Vietnam where more than 3,200
commuter buses of different sizes are currently in service.
Siemens
Vietnam and Vinamotor launched the first hybrid-drive prototype bus in Hanoi
in June 2013, a year when it celebrated the 20th anniversary of its official
presence in Vietnam. The bus was the result of nine months of close
collaboration between the two sides.
In
September 2012, representatives of Siemens Vietnam and Vinamotor clinched a
contract for manufacturing the bus prototype, three months after the two
sides initialed a cooperation agreement for applying the Siemens ELFA
hybrid-drive technology to city buses in Vietnam.
As the
technology enables fuel consumption reduction by up to 50%, operators of
those buses using this technology will be able to save significant costs and
contribute to environmental protection.
Lai
said 2013 was a successful year for Siemens Vietnam as the company saw its
revenue increase by 25% over 2012 as the result of many major contracts it
won in the areas of energy, healthcare, industry, infrastructure and urban
development.
The
contracts included extension maintenance and equipment supply services for
Phu My 3 combined-cycle power plant in Ba Ria-Vung Tau Province, equipment
supply for the Pho Noi 500kV station and its electricity transmission lines,
and the comprehensive Aptio Automation solution for the medical center Medic
in HCMC to ease workload and offer better healthcare services to patients.
Lai
said that this year Siemens Vietnam continued identifying more opportunities
in the energy, healthcare, industry, infrastructure and urban development as
these were strongly expanding market segments in this country.
Lai
hoped that the company would achieve a double-digit growth in revenue in 2014
although many challenges remained in this market this year.
Numerous
apartments await buyers this year
Though
HCMC’s property market warmed up a little last year, project investors still
have much to do as there are dozens of thousands of unsold apartments
awaiting buyers.
According
to statistics of market research firms, HCMC still has 17,200 unsold apartments,
with high-end apartments located in districts 2 and 7 and low-cost ones in
the outlying districts of Binh Tan, Tan Phu and Binh Chanh.
The
selling prices of high-end and low-cost apartments fluctuate around VND30
million and VND15 million per square meter respectively.
To
stir up the market last year, investors had to offer many special promotions
to attract buyers instead of providing direct discounts.
Offering
financial support with longer payment terms was the solution used by many
enterprises to reduce pressure for customers. The payments were made in tiny
installments to make the scheme more affordable to buyers.
For
instance, Novaland offered a payment method over a long period of up to 50
months to buyers of Sunrise City apartments in HCMC’s District 7 and buyers
would pay around VND32 million each month. Similarly, with the Tropic Garden
project in District 2, buyers could pay VND22.9 million monthly in 49 months.
Besides,
paying installments in 2-5 years with no interest rate was another solution
used by such property firms as Thu Duc House with the TDH Truong Tho
apartment project and Him Lam Land with the Him Lam Riverside project.
One of
the home buyers’ concerns was the volatile interest rates that caused
difficulties to buyers when planning bank loan payments. To ease such
concern, some enterprises coordinated with banks to launch the selling
programs with interest rates kept unchanged during the payment period.
Phu My
Hung Corporation in coordination with some banks offered a stable rate of 8%
per year to buyers of Happy Valley apartments, and customers of the EHome 3
project invested by Nam Long Corporation also enjoyed a similar rate.
Meanwhile, at Him Lam Riverside, buyers could pay half of the value to
receive apartments and the remaining amount would be paid in five years with
a rate of 6% per year.
In
addition to financial support programs, some enterprises pledged to help
buyers lease out their apartments in a couple of years.
Him
Lam Land pledged to rent Him Lam Riverside apartments from buyers in two
years at up to VND24 million per month.
According
to Him Lam Land, the renting pledge helped buyer to exploit their apartments
in the first two years and ensured the apartment values amid current
situations.
At Le
Thanh Twin Towers invested by Le Thanh Company in Binh Tan District, tenants
gave VND350 million to the project owner to earn the right to stay in an
apartment in up to 49 years.
Some
investors reduced the service fees to attract potential customers.
With
the SunView Town project in Thu Duc District, Dat Xanh Group offered free
management services in 3-10 years, helping buyers to save around VND3 million
each year.
In the
land lot segment, some enterprises gave construction materials, or even built
the foundations free of charge for buyers. Buyers of land lots in Tay Bac
Saigon urban area, for example, were given five tons of cement and 5,000
bricks.
Various
solutions taken by property enterprises created certain vibrancy on the
market last year, with the number of apartments sold much higher than in
2012.
According
to Savills Vietnam, among 6,400 apartments offered for sale last year, around
5,800 units found buyers, up 46% from the previous year.
Source:
VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Tư, 29 tháng 1, 2014
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