On September 18, the State Securities Commission (SSC) issued a certificate of registration for share issuance in exchange for the merger contract between HRT and SRT.
Specifically, the merged company, Joint Stock Railway Transport, will issue nearly 130.4 million shares to swap all shares of HRT and SRT shareholders, corresponding to a total issuance value of nearly VND 1,304 billion at par value. The exchange ratio is 1 HRT share for 1.09071 shares of the merged company, and 1 SRT share for 0.85565 shares of the merged company. These shares are not restricted from transfer.
The merger of the two companies is part of the Restructuring Plan of Vietnam Railways (VNR) by the end of 2025, as determined by the Prime Minister in Decision No. 562/QD-TTg dated June 26, 2024.
HRT and SRT are the largest members of VNR, with charter capital of VND 800.6 billion and VND 503.1 billion, respectively. Currently, VNR owns 91.62% of HRT‘s capital and 78.44% of SRT‘s capital.
HRT manages routes from Hanoi to Ho Chi Minh City, Lao Cai, Dong Dang, Hai Phong, and two routes Yen Vien – Quan Trieu, Kep – Cai Lan. Meanwhile, SRT manages routes from Ho Chi Minh City to Hanoi, Nha Trang, Tuy Hoa, Danang, Hue, Vinh, Lao Cai, Hai Phong, Lang Son, etc.
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According to VNR‘s leadership, the merger of the two units will increase revenue for the company, increase employees’ income, and especially make the most efficient use of the physical facilities of both units.
VNR is expected to register the business of the merged company in the early fourth quarter of 2024, ensuring the completion of the merger within 2024, in line with the Prime Minister’s direction.
In terms of business results, in the first half of 2024, both HRT and SRT exceeded the full-year profit plan by several times due to “sold-out” train tickets during the Tet holiday. Specifically, HRT recorded a net profit of over VND 40 billion, while SRT earned approximately VND 38 billion.
Previously, both enterprises had gone through a long period of continuous business losses. As of June 30, 2024, HRT‘s accumulated loss decreased to VND 329 billion, while SRT‘s accumulated loss was nearly VND 344 billion.
Burdened by costs, the railway industry’s profits eroded in the second quarter
In the stock market, both HRT and SRT have been traded on UPCoM since 2016 and have low liquidity. After a long adjustment period from mid-July, the two codes continuously hit the ceiling price in the two sessions of September 23-24.
In the afternoon session of September 25, SRT shares were in a “sell-side freeze” status and continued to rise to the ceiling price of VND 13,400 per share. Meanwhile, HRT shares hovered around the historical peak of VND 16,000 per share, more than 2.5 times higher than the beginning of the year.
 Stock price movement of HRT and SRT since the beginning of 2024
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Railroad stocks suddenly “surfed” right after the news that the Central Committee agreed on the policy to invest in the North-South high-speed rail project (350km/h), which is expected to be submitted to the National Assembly for consideration and decision on investment policy approval at the 8th session, opening in October 2024.
Important contents agreed upon at the 10th Conference
Previously, at the Conference on Solutions to Contribute to the Socio-Economic Development of the Country on September 21, Prime Minister Pham Minh Chinh highly appreciated the enterprises’ proposals and assigned specific tasks in constructing the North-South high-speed railway, urban railways, steel production, and building expressways…
The North-South High-Speed Rail Project has a total investment of 70 billion USD. The route is 1,541km long, with a maximum speed of 350km/h, starting from Ngoc Hoi Station (Hanoi) through 20 provinces and cities and ending at Thu Thiem Station (Ho Chi Minh City). The entire line will have 23 passenger stations, with an average distance of 67km between stations, along with 5 cargo stations located in major trading areas.
The Early Bird Catches the Worm: Get Your Tet Train Tickets Now and Avoid the ‘Chair Scramble’
To meet the high travel demand during the 2025 Lunar New Year, the Vietnam Railways Corporation has initiated an early sale of train tickets for the Lunar New Year, with a special emphasis on not offering any auxiliary or convertible seats.
The Rail Revival: Restoring Connectivity on the North-South Railway Line Post-Storm
The Vietnam Railways Corporation (VNR) has successfully recovered from the disruptions caused by Typhoon No. 3 on the North-South railway line. With swift and efficient efforts, the railway line is now fully operational, ensuring a return to normal train services as of today, September 8th.
“Free Transport of Relief Goods to the North by Rail and Air”
From September 11th, the railway sector and domestic airlines will offer free transportation for relief goods to those affected by Storm No. 3.
The Rail Route Through Vietnam’s Most Scenic “Heritage Path”: What’s the 19,000 Billion VND For?
The Railway Authority has proposed an exciting initiative to renovate the country’s most renowned heritage rail line.
The Iron Road Enters a New Age, Partnering with a Pure Vietnamese Super App
“Vietnam Railways (VNR) has reported a significant rebound in rail travel demand, with figures almost reaching pre-COVID-19 pandemic levels. This surge in rail travel signifies a promising recovery for the industry, indicating a strong return to normalcy for Vietnam’s transport sector.”
