VSF shares skyrocketed thanks to expectations of good rice export prices, and Mr. Hien's investment in Vinafood 2 also jumped to nearly VND5,000 billion.
Rice stocks have recently become the focus of cash flow on the stock market, in which VSF of the Southern Food Corporation (Vinafood 2) is the biggest bright spot when its market price skyrocketed nearly 5 times in less than 2 months.
Profit by times
Previously, VSF was one of the stocks with "low" liquidity in the market because few investors were interested, the trading volume per session was only a few hundred to a few thousand shares, and there were even periods when this stock code had no transactions.
However, when investors began to pay attention to Vietnam's rice exports benefiting from the tightening of global supply, VSF shares were quickly mentioned as a leading enterprise in the domestic food industry.
From a price of only around VND 8,000/share at the end of July, VSF quickly climbed to a historical peak of more than VND 40,000/share, before being slightly adjusted by the market to VND 38,800/share in the most recent trading session.
The capitalization value of this rice exporting company in the South accordingly skyrocketed to about 20,000 billion VND, creating "estimated profits" of thousands of billion VND for shareholders, especially major shareholders.
Currently, this corporation has 500 million shares in circulation, equivalent to a charter capital of VND5,000 billion. Of which, the Ministry of Agriculture and Rural Development is the largest shareholder, accounting for 51.43% of the capital, T&T Group holds 25% of the shares, and the rest are small shareholders.
When Vinafood 2 was equitized in early 2018, Mr. Do Quang Hien's T&T Group participated in the auction to become a strategic investor by purchasing 125 million VSF. The amount this group spent was more than 1,200 billion VND, equivalent to a price of 10,100 VND per share.
T&T's shareholding ratio has remained unchanged, but the value of the shares has skyrocketed. From the initial capital of VND1,200 billion, Mr. Hien's investment in VSF is now worth VND4,850 billion, temporarily recording a profit of more than VND3,600 billion.
Vinafood 2 is T&T’s first major investment in the rice export sector. Previously, Mr. Hien’s group also had investments in forestry, vegetables and agricultural materials.
Gradually recovering after many bad years
Vinafood 2, formerly known as Southern Rice Corporation, was established in 1976. It has operated as a single-member LLC since 2010 and has officially converted to a joint stock company model since 2018.
In over 45 years of operation, the corporation has become a major rice trading enterprise in the world with an average annual processing and export volume of about 2.8-3 million tons of rice. The export turnover in some years reached over 1 billion USD, contributing significantly to the consumption of food commodities for farmers; developing the domestic market, stabilizing prices, ensuring national food security.
Despite its high position in the Vietnamese rice industry value chain, Vinafood 2's business results have been ineffective, especially in the post-equitization period (after 2018) due to problems left over from the old management period. The company continued to suffer huge losses of hundreds of billions of dong afterwards.
In 2022, with a series of good news for the rice industry, Vinafood 2's business activities also gradually had positive changes, the biggest turning point was that the company made a profit for the first time after equitization.
According to the 2023 semi-annual financial report, the corporation continued to record positive results with revenue of VND 11,340 billion and after-tax profit of nearly VND 10 billion, 60% and 100% higher respectively over the same period last year.
Explaining the improved business performance, Vinafood 2 leaders said they have accelerated restructuring, reduced costs, closely monitored market developments and promptly seized business opportunities.
However, it must be noted that this corporation still has many outstanding problems left over from the previous period. Most notably, the accumulated loss by the middle of this year is still more than 2,800 billion VND, making it one of the enterprises with the largest accumulated losses on the stock market.
The company's total assets reached over VND8,800 billion, of which the majority was inventory value of over VND3,000 billion. In terms of capital, this rice exporting company is recording a total financial debt value that has skyrocketed to VND4,264 billion (VND2,560 billion at the beginning of the year).
Mr. Hien's T&T Group is doing business in many fields such as banking, securities, insurance, real estate, energy, environment, agriculture, services, retail, seaports, transportation, healthcare, sports...
In which, the agricultural sector recorded large member companies such as Vinafood 2, Vietnam Forestry Corporation (Vinafor), Vegetable and Fruit Corporation (Vegetexco), Vietnam Agricultural Materials Corporation (Vigecam), T&T Green Life Agricultural Development Company Limited (T.Vita).
