It is also the Covid pandemic that has squeezed the demand for investment real estate and is gradually being restarted.
Which group of real estate stocks is ‘breaking the top’?
In terms of long-term investment, Vietnam’s real estate is always a potential market. According to experts, real estate is still a safe “haven” during periods of economic crisis. That is also part of the reason why stocks of real estate businesses are having a strong breakthrough. A series of stocks maintained sustained gains, surpassing all-time highs, forming the biggest and longest tsunami in 2021. Many stocks increased 200%-300% in just a few months. Making a great contribution to the booming stock market, and closing the last session of October 2021 quite impressively when the VN-Index reached 1,444.27 points, setting a new record level after more than 21 years of establishment.
In the blue-chip group, shares of Vinhomes Joint Stock Company (VHM) are the brightest names when having the 6th consecutive increase in price after a period of “silence”. VHM’s market price has increased by 9.6% in just one week, which is considered a big increase in blue-chips.
In the midcap group HDC, NLG, IDJ, NTL, DTA… are bright names, attracting strong cash flow. Many real estate stocks also recorded their highest ever market prices. In which, the Third Joint Stock Company (DTA – Hose) in the third quarter increased by over 200% from the price range of 9,000 to nearly 27,000 VND/share. Or it can be mentioned that Dat Phuong Joint Stock Company (DPG) doubled its potential near the 3-digit price range – the highest market price ever.
This makes the market price level of all stocks raised at 40,000-100,000 VND. Currently, there are nearly a dozen stocks with a market value of over 100,000 VND, besides the “old” faces, there are new “big guys” joining such as Sunshine Homes (SSH), Hodeco (HDC), and most notably, Licogi 14 (L14)
In addition to commercial and construction real estate stocks, the group of industrial park real estate stocks also attracted quite strong cash flow. In this group, there are some prominent representatives such as SZC, PHR, VGC, LHG.
Closely related to the wave of real estate
According to a report by Batdongsan.com.vn, interest in peri-urban provinces such as Binh Duong, Long An, Ba Ria – Vung Tau all increased by 10% in September. The trend of real estate selection in areas The suburbs, where there are well-connected infrastructures, high urbanization rates, liquidity and capital are the big plus points that investors are aiming for.
Share the reason why real estate stocks “break the top”, according to Hello Group Co., Ltd.’s analysis, real estate companies, especially industrial real estate groups, can grow well. and maintain their form for a long time is thanks to 3 main reasons as follows:
The first is the need to move large factories, $23.74 billion of foreign investment flows into the market
Talking about the process industrial zone and starting with the US-China trade war caused a big wave of trade displacement. The world’s major factories began to move to Asia and Vietnam also benefited from this wave. The process of shifting supply chains from China to Southeast Asia will accelerate after the Regional Comprehensive Economic Partnership (RCEP), a free trade agreement involving 10 ASEAN countries and Australia, China, and Japan. Japan, New Zealand and South Korea, could come into force in 2022.
Most recently, from March, the American company Apple began to shift production from China to Vietnam and increase the production of headphones in Vietnam. Or Google and Microsoft are also moving some production lines from China to Vietnam… Especially recently, the world’s media reported that the US has identified Vietnam as a priority partner in the supply chain.
In addition, in September, Vietnamese businesses signed commercial agreements and contracts worth billions of dollars with leading US corporations. For example, Quantum Group (USA) and a consortium of Kinh Bac Urban Development Corporation and Saigon Telecommunications Technology Joint Stock Company (Saigontel) have also joined hands to invest up to 30 billion USD on the same day. 9/22. Recently, T&T Group and UPC Renewables Corporation (USA) also signed a cooperation agreement worth 3 billion USD in the field of renewable energy in Vietnam.
As of October 20, 2021, the total registered foreign investment capital in Vietnam (FDI) reached $23.74 billion, up 1.1% over the same period. This shows that Vietnam continues to be a safe and attractive destination.
The second is the growth engine that comes from the upgrade of infrastructure thanks to the promotion of public investment and untangling legal procedures.
Promoting public investment is considered a key focus of the government in developing the country’s mainstream GDP in 2021. Upgrading infrastructure, convenient connections, airports and seaports creating conditions for the development of production activities, housing demand, making real estate activities more active and vibrant in terms of both selling price and demand.
Previously, legal procedures were cumbersome, overlapping and causing trouble
Perhaps after the Asian Financial Crisis (1997) and the World Economic Crisis (2008), market research companies and securities organizations have come across a situation where they have to constantly change their economic forecasts. macroeconomic as in the past. Of course, Covid-19 is a socio-economic event that turns everything upside down.
In mid-August, Rong Viet Securities (VDSC) downgraded Vietnam’s economic outlook for the second half of 2021 to 4%, reflecting the negative effects of the fourth outbreak on domestic activities as well as on domestic activities. lasting effects of Covid-19 prevention measures on economic activity. National economic growth is said to depend on the effectiveness of disease prevention and vaccination progress.
Statistics of VDSC and Fiinpro show that securities, steel and real estate are the three leading industry groups in semi-annual revenue growth. The growth index is 82%, 51% and 47% respectively. While steel and securities still maintained their performance in terms of profit growth, the real estate industry dropped to 5th place with an increase of 75%. In general, most industries reported strong growth in both revenue and net profit in the first 6 months of 2021 but mainly based on last year’s lows.
Regarding the domestic market outlook, this securities company believes that along with retail, F&B and technology, real estate will be the main beneficiary when the social distancing order is gradually eased in the near future. . The unit holds a positive view for the industry’s long-term growth potential. In particular, industrial real estate received more positive points than residential real estate.
In the second half of this year, residential real estate is forecasted to have better business results. Specifically, this sector is forecasted by VDSC with revenue of 12,555 billion dong, net profit of 4,097 billion dong, up 25% and 69% compared to the second half of 2020. Meanwhile, industrial zones can record received a total of 3,826 billion VND in revenue and 487 billion VND in profit after tax. Over the same period, industrial park real estate can accumulate 36% more revenue but lose 47% profit.
“In the second half of 2021, we believe that promoting public investment focusing on transport infrastructure in line with the Government’s policy will be the key factor leading the real estate industry. Besides, the legal conditions will be more favorable from positive changes in the revised Construction Law 2020, Investment Law 2020 and Decree 148/2020/ND-CP. In addition, the fact that home loan interest rates are still maintained at low levels will support stable demand in the coming time. However, the main concern still comes from the increasingly complicated development of the Covid-19 epidemic,” the report stated.
