Specifically, Vietourist Holdings JSC (UPCoM: VTD) will use approximately VND 10 billion to supplement its working capital. This includes spending nearly VND 3.9 billion on air tickets, VND 4.1 billion on hotel services, and nearly VND 2 billion on catering services.
Previously, the Company intended to use this VND 10 billion as a deposit for purchasing Mr. Doan Xuan Tien’s capital contribution at Doan Gia QB Investment Co., Ltd. The reason for this change, according to VTD, is that they reassessed their capital usage and business plans and concluded that it is not the right time to proceed with the expansion plan through the acquisition of Doan Gia QB. As a result, the plan has been canceled, and the entire amount will be recovered and utilized for working capital as mentioned.
In early July, VTD executed the contract termination with Mr. Doan Xuan Tien and successfully recovered the full deposit of VND 10 billion.
Doan Gia QB Investment Co., Ltd. was established in 2016 with an initial charter capital of VND 10 billion, of which Mr. Doan Xuan Tien contributed 80%, and Mr. Pham Minh Hoa contributed the remaining 20%. The company has since increased its capital to VND 150 billion. They own the Doan Gia Resort project, a 3-star resort in Quang Binh, spanning over 13,000 m2. The resort includes 25 smart bungalows, 22 Hoi An-style villas, 2 Asian restaurants, 2 European restaurants, a conference hall, a swimming pool, and more.
Additionally, the company has the right to operate and manage two caves, Hang O Ro and Hang Hoan My, located within the forest area managed by the Phong Nha-Ke Bang National Park Management Board. The total expected purchase value is VND 145 billion. As of September 2022, the value of Mr. Doan Xuan Tien’s capital contribution was VND 80 billion, representing 100% of Doan Gia QB Investment Co., Ltd.’s charter capital.
 A glimpse of Doan Gia Resort. Source: FB Doan Gia Resort Phong Nha
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The remaining funds will be used according to the adjusted plan from March 2023. This includes investing over VND 39 billion in the Vietrip vehicle fleet and nearly VND 11 billion as a deposit for purchasing a boutique hotel at the Regal Legend Quang Binh urban and tourism complex project (also known as Bao Ninh 1) in Dong Hoi city, Quang Binh province.
Initially, VTD intended to purchase five boutique hotels for a total of nearly VND 61 billion and an area of 2,400 m2 to invest in assets serving the tourism ecosystem. However, they have since reduced the number to three hotels and will spend a maximum of VND 45 billion.
The developer of the Regal Legend Quang Binh project is Central Land JSC (now known as Regal Group JSC, a subsidiary of Real Estate Service JSC (HOSE: DXS), which owns 55%).
Regarding additional capital raising, VTD is in the process of implementing a share offering to existing shareholders, aiming to double the number of circulating shares and raise VND 120 billion. Subsequently, the chartered capital will increase to VND 240 billion.
The offering is scheduled to take place from Q3 2024 to Q2 2025, and if successful, VTD‘s management plans to use the entire amount to purchase 32 47-seat Huyndai vehicles. This includes spending over VND 116 billion (including VAT) on vehicle purchases and VND 3.6 billion on license plate fees, registration, inspection, road maintenance, dashboard cameras, insurance, and more.
Viet Nhat Auto Co., Ltd. will be the vehicle supplier for VTD. Each car is priced at approximately VND 3.65 billion. In Q3 of this year, the Company plans to purchase one car, followed by five more in Q4. In Q1 and Q2 of the following year, they will add ten and sixteen vehicles, respectively. The timing and quantity of these purchases may vary depending on actual business needs and available capital.
VTD’s tourism vehicle fleet. Source: VTD
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In the event that all shares are not distributed and the amount raised falls short of expectations, the Board of Directors will request an extension for the offering to sell the remaining shares. Additionally, they will seek capital from bank loans, financial institutions, bond issuances, idle funds from customers, or other funding sources to make up the difference.
The tourism company anticipates a business recovery during the 2024-2026 period and has decided to invest significantly in the Vietrip vehicle fleet to enhance its capacity to transport tourists. This aligns with their plan to expand their domestic and international tourism market segments.
In April, VTD‘s Board of Directors decided to sell the property located at 154 Ly Chinh Thang, Vo Thi Sau Ward, District 3, Ho Chi Minh City, with the intention of investing in other assets. The real estate is situated on a land area of approximately 46 m2 and consists of four floors and a mezzanine. The expected selling price is VND 25 billion.
| Chart: VTD‘s Chartered Capital Changes from 2017 to 2023 |
