Ia Pet Dak Doa 1 Wind Power Plant. (Photo: iapetwind.com) Xuan Thien Group is one of the major investors in the energysector, with two clusters of solar power projects in Ninh Thuan and Dak Lak. Inaddition to solar power, this group also invests in hydropower, with 20projects with a total capacity of 400MW developed to date.
According to Nguyen Van Thien, Chairman of the Xuan Thien Group,the group has more than 80 member companies in the country and abroad, with atotal charter capital of more than 100 trillion VND, specialising in investingin energy production, high-tech agriculture, construction materials, bankingand finance and a number of other service industries. Currently, the group'smember companies own many power plants and produce construction materials, withannual revenue of 20 trillion VND.
In Dak Lak, the Xuan Thien Group invested in Xuan Thien Ea Supsolar power plant cluster, with a total investment of more than 50 trillion VND,design capacity of 2,000 MWac (equivalent to 2,800 MWp). Phase 1 of thisproject includes four factories: Ea Sup 1, Ea Sup 2, Ea Sup 3 and Ea Sup 5,with a total investment capital of 16.5 trillion VND, completed in 2020. Phase2 includes 10 factories. The factories are under construction, with totalinvestment capital of 33.5 trillion VND.
This project cluster is built on a total area of about 4,180hectares of land and is considered one of the solar power projects with thelargest capacity in Southeast Asia.
Recently, a number of companies under the Xuan Thien Group haveannounced financial information according to regulations on private offeringand trading of corporate bonds. In particular, Ea Sup 1 Joint Stock Companyshowed a decrease in profits and an increase in the debt to equity ratio.
In 2021, Ea Sup 1 profit after tax reached 42.6 billion VND. In2022, it only recorded a profit of 10.6 billion VND, down 75.1% compared to theprevious year. In the first half of 2023, the company reported profit after taxof 15.5 billion VND, down 27.9% over the same period last year.
Ea Sup 1's 2023 semi-annual financial report showed that thecompany's equity at the end of June 2023 was 823.8 billion VND, a slightincrease compared to 819.2 billion VND in the same period last year. However,the debt to equity ratio also increased from 1.91 times to 2.25 times,corresponding to liabilities of more than 1.85 trillion VND.
Ea Sup 3 Joint Stock Company reported a profit of 31.4 billion VNDin 2021, but in 2022 it lost nearly 3 billion VND. In the first half of thisyear, it lost 7.5 billion VND. As of June 30, 2023, Ea Sup 3's equity reached 5.55trillion VND, the debt to equity ratio was 0.35 times, equivalent to aliability of more than 1.9 trillion VND.
Similarly, Ea Sup 5 Joint Stock Company recorded an after-tax lossof 24.8 trillion VND in the first half of this year, while in the same periodlast year, it recorded an after-tax profit of 33.5 billion VND. As of June 30,2023, the company's equity reached 1.07 trillion VND, the debt to equity ratiowas 3.14 times, corresponding to the amount of debt payable of about 3.35trillion VND.
In 2021, the company's profit after tax was 551.2 million VND, asharp decrease compared to the figure of 33.9 billion VND recorded in 2020. Asof December 31, 2021, the company had 3.4 billion VND in liabilities, the sizeof equity was 1.09 trillion VND, equivalent to a debt-to-equity ratio of 3.15times, a sharp increase compared to 2.19 times at the end of 2020.
Like many other businesses, the Xuan Thien Group has mobilisedlarge capital through the bond channel to invest in solar power projects.
According to the Hanoi Stock Exchange (HNX), in August 2020, Ea Sup1 issued 11 lots of bonds with terms ranging from 2 years to 12 years, with atotal value of 1.63 trillion VND.
Also in August 2020, Ea Sup 3 issued 11 lots of bonds with termsranging from 2 years to 12 years, with a total value of 1.63 trillion VND.
Ea Sup 5 issued 11 lots of bonds in June 2020, with a total valueof 2.39 trillion VND.
Ia Pet Dak Doa Wind Power Plant Number One Joint Stock Company (IaPet Dak Doa WPP No1) and Ia Pet Dak Doa Wind Power Number Two Joint StockCompany (Ia Pet Dak Doa WPP No2), respectively, are the investors of the Ia PetDak Doa 1 Wind Power Plant and Ia Pet Dak Doa 2 Wind Power Plant. These are twoprojects whose planning was approved in June 2020 and are the two largest windpower plants built in Gia Lai province.
According to the latest financial situation announcement of Ia PetDak Doa WPP No1, the company's equity as of June 30, 2023 reached 518.3 billionVND, down 18.4% over the same period last year. Liabilities were estimated at 3.3trillion VND, 6.45 times higher than equity. Outstanding bond debt was 416.7billion VND, down 10% over the same period last year.
In the first half of 2023, the company reported a loss of 71billion VND, a sharp decrease compared to the loss of 160.4 billion VND recordedin the same period last year. However, this result was down sharply compared tothe profit of 7 billion VND in 2021.
The situation at Ia Pet Dak Doa WPP No2 is similar. The companyreported a loss of 75 billion VND in the first half of this year, a loss of 154.4billion VND in the same period last year. At the end of the second quarter of2023, the company's equity was 466 billion VND, down 20.7% over the same periodlast year. The company had 3.26 trillion VND in liabilities, 6.99 times morethan equity.
In the first half of this year, outstanding bond debt of Ia Pet Dak Doa WPP No2 decreased from 448 billion VND to 403.2 billion VND. However, dueto losses and decreased equity, the company's outstanding debt to equity ratioincreased from 0.76 times at the end of the second quarter of last year to 0.86times at the end of the second quarter of this year.
According to ACBS Securities Company, the poor business results ofrenewable energy businesses stem from many reasons, including businesses usingfinancial leverage by mobilising large amounts of capital through bondissuance. Many businesses have a debt-to-equity ratio of more than four times.In the context of high interest rates, businesses have to use many resources topay bond interest./.
VNA
