In Q3 2024, TDG plans to offer 1,000 bonds with a face value of VND 100 million each to professional securities investors. The interest rate for the first two interest periods (corresponding to the first 12 months) is 12.5% per annum. The remaining periods will be the sum of 4.5% and the reference interest rate (savings deposit interest rate applied to individual customers with a term of 13 months of HDBank).
The bonds are non-convertible, non-warrant, asset-backed, and establish a direct debt obligation for TDG. The issuance plan will be reported by the Board of Directors to the General Meeting of Shareholders at the upcoming meeting.
The first secured asset includes the future assets of the Bac Son 2 Industrial Cluster project, valued at over VND 217 billion according to the valuation certificate dated August 16, 2024, of Dong Duong Investment and Valuation Joint Stock Company, with HDBank as the asset management representative. In addition, the secured assets will also include 946,379 shares of TDG, worth more than VND 4.9 billion, according to the valuation certificate dated August 21, 2024, of International Audit and Valuation JSC, owned by TDG‘s General Director, Le Minh Hieu, with HD Securities (HDS) as the management representative.
The company plans to use all proceeds from the bond issuance to invest in and build the Bac Son 2 Industrial Cluster project in Bac Son district, Lang Son province, with TDG as the investor, according to the provincial People’s Committee of Lang Son’s approval in principle and the approval of the investor for the project last April. The disbursement is expected in Q3 and Q4 of this year.
The Bac Son 2 Industrial Cluster is located on a 25-hectare land area and will be invested in the construction of a complete and synchronous technical infrastructure system. The project will attract industries such as agricultural and forestry product processing and preservation, building materials, industrial services, garment and footwear, electronic component manufacturing, mechanical processing, biomass power production, warehouse leasing, wood and paper production and processing, gas bottling, etc. The total investment capital is about VND 286 billion. The operation time is 50 years from the date the investor is decided to lease the land.
 Bac Son 2 Industrial Cluster Project Perspective. Source: TDG
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The Bac Son 2 Industrial Cluster has been approved for a detailed construction planning at a scale of 1/500; approval of the environmental impact assessment report; notification of land recovery for project implementation, approval of compensation, support, and resettlement, and approval of land price to serve as a basis for compensation calculation when the State recovers land.
According to TDG, the project may face risks in the real estate business in general and industrial cluster real estate in particular. Completing the legal procedures and documents can take a long time and incur additional costs, not to mention the dependence on many factors, including administrative procedures at competent state agencies. The cash flow generated from business and lease activities depends on the progress of completing the legal procedures and the construction progress of the technical infrastructure. Delays in completing the legal procedures may lead to delays in the project progress, affecting revenue plans, and increasing costs.
The company stated that it had no violations of the law on corporate bond issuance in the three consecutive years before the upcoming offering. Currently, TDG‘s bond debt balance is VND 40 billion in the TDGH2326001 batch. Bond interest paid since the issuance date is over VND 5.5 billion.
Previously, TDG raised VND 40 billion (at par value) from the TDGBH2223001 batch issued on January 18, 2022, with a term of 12 months. The report on principal and interest payment in 2023 shows that the company has been agreed by the bondholders to swap the entire principal into bonds coded TDGH2326001, extending the maturity by three years to March 24, 2026, with an interest rate of 13.7% per annum.
In June 2024, Nguyen Tin Investment Group Joint Stock Company, a company with the same Chairman, Mr. Truong Dinh Hai, as TDG, together with TDG, HDBank, and HDS, signed a memorandum of understanding on arranging a bond issuance of more than VND 2,700 billion for investment in real estate and industrial cluster projects. Of which, the Bac Son 2 Industrial Cluster project is expected to borrow VND 260 billion.
Besides the Bac Son 2 Industrial Cluster, TDG‘s development plan also includes the Bac Son 1 Industrial Cluster, also located in Lang Son province, with a total expected investment of about VND 250 billion.
Signing of a memorandum of understanding on arranging VND 260 billion bond issuance for the Bac Son 2 Industrial Cluster project between HDBank, HDS, and TDG. Source: Nguyen Tin Group
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