Novaland (HSX: NVL) is a large listed company on the Vietnamese stock exchange, which, following a review in July 2020, continued to be included in the VN30 index of the 30 largest companies.
The share once again made it onto the Vietnam Sustainability Index (VNSI). VNSI targets standardising sustainable development for listed companies, supporting organisations and individuals in identifying good companies for investment, boosting the sustainable development of the economy, and providing a new tool to foster the development of stock markets and the economy.
In the first half of 2020, pro-forma consolidated net revenue, including revenue from sales of goods and rendering of services and transfer of projects was VND4.361 trillion ($189.6 million). The group posted VND1.487 trillion ($64.65 million) in pre-tax profit and VND1.177 trillion ($51.2 million) in net after-tax profit, up 12 and 48 per cent on-year, respectively. Its gross profit margin reached 35 per cent, surging by 8 per cent on-year.
As of June 30, the developer’s total asset value increased to VND98.78 trillion ($4.3 billion), up nearly 10 per cent year-to-date. The group has reported high liquidity, attested through current ratio reaching 3.52x, equal to the figure in 2019 and nearly 1.8-fold higher than in 2016-2018. The quick ratio reached 0.8x.
In parallel to expanding investment into its land bank in areas with rosy development potential and an upsurge in price in the future, the group has been proactive with its divestment plans once its expected profit ratio has been met.
The proceeds of project transfer will be channelled back into new projects with high profitability or spent on payment of loans before they are due and ensuring stable capital sources for production business activities in the forthcoming time.
Accordingly, in June, Novaland finalised the transfer of the entirety of stakes in a joint-stock company in the form of capital contribution and picked up more than VND1.7 trillion ($73.9 million) in profit. Another transaction that the company made in the first half of 2020 also brought VND795 billion ($34.57 million) to its profit.
|The Grand Manhattan, an upscale project of Novaland |
Since this second quarter, Novaland has teamed up with a slew of distribution agents to ramp up the exposure of its products to customers and investors across the country.
The group hosted diverse sales promotion events for Aqua City – an appealing urban metropolis located in the eastern gateway to Ho Chi Minh City – after the social distancing period. The project received positive feedback from the market with the sales ratio of townhouse, shophouse, and villa units reaching 95 per cent in each launching event. A new phase of the Aqua City project is expected to come onto the market within this month, featuring modern tropical-style architecture that promises to create a stir in the market.
|In the medium and long term, Novaland will focus on expediting projects that are in high demand and are within an affordable range for customers. |
In the hospitality real estate segment, Novaland has continued to launch a series of outstanding projects, such as the new phase of NovaWorld Ho Tram named Wonderland which consists of more than 270 second homes (shophouse, beach villas). Earlier, its first phase named The Tropicana has also introduced to the market over 100 beachfront villas and a 5-star MGallery hotel operated by Accor.
In the first half, Novaland completed payment of its debts’ principal amounting to VND8.359 trillion ($363.43 million). Its financial leverage ratio was assessed by the investor circle as stable, fully meeting commitments to domestic and international credit institutions.
According to Novaland’s Board of Management, albeit 2020 is a thoroughly challenging year, the group’s long-term development strategy remains unchanged. In the medium and long term, the group will focus on expediting projects that are in high demand and are within an affordable range for customers.
Novaland envisages developing 22 additional projects across the southern region such as Ho Chi Minh City, Dong Nai, Binh Thuan, Khanh Hoa, and Ba Ria-Vung Tau, and ensuring the hand-over of 10 projects.