Investors should focus on some of the most important factors such as clean land fund and legal status of the firms before buying their stocks. (Photo: ndh) Hanoi (VNS/VNA) - Though difficulties caused by COVID-19 were reflected in the businessresults of listed realty firms, experts are still optimistic about the market.
Le Nhi Nang, chief representativeof the State Securities Commission (SSC) in Ho Chi Minh City, told a recent seminar onrealty stocks that focused on investment strategy amid the pandemic that: “Therealty market's difficulties are only short-term.”
According to SSC, the pandemicwas a common challenge to the economy and real estate market whose businesseswere facing difficulties when projects were delayed, supply was declining andthe market was quiet.
SSC said those challenges werereflected in the business results of listed firms, causing their revenue in thefirst six months to decrease by 26 percent, while profit fell by 13 percent over the same period. Among the listed firms, 20 reported losses and 35saw profits drop.
Nang was still optimisticabout the local stock market, adding: “By now, the number of listed firms witha capitalisation of more than 1 billion USD each have reached 30 on bothexchanges, mainly in the banking and finance group and real estate.
“Listed realty firmswith market capitalisation of more than 1 trillion VND (43 million USD), accounted for 23 percent of the whole market.”
Nang said in the long term,buying demand for realty was still very large, especially in the context of thedecreasing interest rates of banks. Therefore, realty stocks are of interestto investors.
He added: “Realty stocks aredivided with strong gainers but strong losers. Investors should be carefulto choose good stocks.”
Vo Tri Thanh, Director of theInstitute of Branding and Competition Strategy, shared the same opinion,saying: “Among many investment channels, it is necessary to give priority tochoosing realty securities. In fact, although the economy is heavily affectedby the COVID-19 pandemic, statistics in 2020 shows that the number ofindividual investors has increased dramatically, the market liquidity is quitehigh, and the VN-Index has bounced up since its bottom in March.”
Truong Hien Phuong, seniordirector of KIS Vietnam Securities Corporation (KIS), said that thedifficult times of the market have gone and the market will soon open up withmedium and long-term opportunities for securities investors, including realtystocks.
Phuong said: “Analysing andselecting potential stocks makes up 50 percent of success in investing.The rest depends on when investors choose to sell.”
Lai Duc Duong, Head of RealEstate Industry Analysis Department, Rong Viet Securities (VDSC), said:“There are many opportunities for investors in realty stocks, especiallyshort-term investment opportunities. Investors should focus on some of the mostimportant factors such as clean land fund and legal status of the firmsbefore buying their stocks.”
Duong advised investors of realtystocks to check the land fund of the firms, saying: “The larger the land fundand the clearer the legal status is, the better the firms are as investments.”
“Currently, many businesses justput projects with full legal status on their financial statements anddon't update the projects that still have problems, making investors onlysee part of the picture, not the overall status of their firms.”
According to Netland deputygeneral director Nguyen Huu Quang, investors need to find out about thefinancial situation and capacity of the business. If some investor buys thestocks at cheap prices, unfortunately many of them will fall intobusinesses with bad financial situations, adding: “Collecting those shares isno different from collecting garbage.”
Differently, Nguyen Minh Khang,general director of LDG Company, said that only short-term investors needed topay attention to factors related to the development orientation and plans ofthe realty firms. Investors with medium and long-term trends should buy anystocks below par value, with the price of each share below 10,000 VND.
According to KIS VietnamSecurities Corporation (KIS), the real estate industry's outlook wasvery good as the Government was removing difficult policies for real estatebusinesses and realty loan rates were listed at an attractive rate, so realtystocks were considered with higher profit by investors./.
VNA
