The updated business results for the whole year of 2024 of the 30 largest listed real estate investors by revenue conducted by VIS Rating show that in the fourth quarter of 2024, investors recorded a significant revenue growth, up to 183% over the same period in 2023, contributing to an increase of 8% in revenue for the whole year of 2024.
However, total net profit is still down 7% due to higher interest costs as well as operating losses of investors facing legal problems.
In 2024, total debt of investors increased by 20% over the same period, to VND208,000 billion, mainly to finance project development costs and supplement working capital or restructuring maturing debt. This increase in debt leads to a 41% increase in interest expenses over the same period.
Notably, the industry's cash flow increased by 46% over the same period in 2024, reaching the highest level in the past 5 years, thanks to strong cash flow from investment and financial activities. This growth is driven by expanding access to capital through bank loans and project restructuring activities such as mergers and acquisitions, business cooperation contracts and share transfers.
However, according to VIS Rating experts, the ability to repay debts of listed real estate enterprises is still weak, reflected in increased leverage ratio and negative operating cash flow.
Most investors have negative operating cash flow in 2024, as many investors have increased disbursement to speed up project development after legal approval and are expected to open for sale in 2025, while other investors are still facing late payment of principal, interest on bonds and project legal issues.
In the current context, listed real estate businesses expect cash flow from business operations to gradually improve. The main driving force comes from the prospect of opening for sale of projects in 2025, along with financial cash flow earned from the successful issuance of capital mobilization stocks and M&A projects transfer in 2024.
Credit flows are also being directed more by banks to projects to increase real estate supply in the future, thereby promoting the demand for loans to buy houses for housing as well as investment. Notably, the value of the prepaid item of the buyer has increased significantly in recent quarters.
VietstockFinance statistics show that the value of buyers paying short-term in 2024 of residential real estate businesses increased by more than 77% compared to 2023, reaching nearly VND 240,000 billion, while unrealised revenue reached more than VND 8,000 billion, equivalent to 2023.
This development will help businesses partly solve liquidity pressure related to debt maturity and bond maturity. Analysts from DSC Securities Company expect that investment cash flow will return to the real estate market in the South from 2025 for many reasons. Firstly, new legal regulations are guided and implemented in localities, thereby having a direction to resolve about 70% of projects in difficulty.
Second, real estate prices in the South are quite reasonable after a period of stagnation. Third, reputable developers are "launching" again, helping to diversify supply and have many options.
The above action resones with the "Southward" trend of cash flow that DSC predicts can create psychological momentum and attract better liquidity to the market, bringing a positive impact on sales of these businesses. Therefore, revenue and profit in the 2025 - 2026 period can grow at a double-digit level compared to the 2023 - 2024 period.
