On the morning of April 24, Vinhomes Joint Stock Company held its annual General Meeting of Shareholders in 2024. At the meeting, a shareholder raised a question about Vinhomes’ use of funds, asking why the company made a large profit but did not pay dividends and whether Vinhomes was “supporting” another company in the Vingroup ecosystem, namely VinFast.
Responding to this shareholder’s question, General Director Nguyen Thu Hang stated that the shareholder could refer to the financial statements and would see that the balance of related party loans was very small, only about VND 1,200 billion.
“We affirm that VinFast has channels to raise capital on its own as a company, and we do not provide funding to other companies in the group,” said Ms. Hang.
Regarding the cash flow when Vinhomes lends to related parties, it is mainly related to treasury operations, with the purpose of optimization and has a very short term, up to 12 months.
Regarding the retention of profits without paying dividends, Ms. Hang said that in fact, in 2020 and 2021, Vinhomes had paid dividends to shareholders. However, the market situation was not good, and Vinhomes in 2022 and 2023 proposed to retain profits for two purposes.
“Firstly, to prepare a contingency plan, to proactively respond in case the situation from the market, capital sources, international and domestic bonds does not recover as quickly as expected.
Secondly, to prepare for a new growth cycle of real estate as well as many other tasks, Vinhomes needs medium- and long-term capital so that the company can be flexible and seize opportunities, thereby breaking through and maintaining its leading position in the market,” said Ms. Hang.
Also related to the medium- and long-term plan, CEO Vinhomes said that in the next 5 years, Vinhomes will continue to aim for the leading position in the market as the largest real estate developer in Vietnam. “In the next 5 years, we will develop ‘super projects’. To prepare for that, we are both designing, researching the market and preparing medium- and long-term capital sources,” said the female leader.
According to Ms. Hang, the legal issues, project locations, and land fund of Vinhomes are always ensured so that the company can develop stably and sustainably. In addition, the design team and the market research team are constantly researching to supplement the most suitable utilities for each resident community such as the Korean, Japanese communities… in order to enhance the living value and also raise the project’s value.
