TNR Holdings must pay more than 2.2 billion VND in bond interest per day in 2024

Paying more than VND819 billion in bond interest

According to the 2024 bond principal and interest payment report of TNR Holdings Vietnam Real Estate Development Investment Joint Stock Company (TNR Holdings), in the past year, the enterprise has paid interest to 141 bond codes, with a total amount of more than 819 billion VND. On average, TNR Holdings has to spend more than 2.2 billion VND per day to pay bond interest.

Notably, in the bond portfolio of TNR Holdings, some stocks have large issuance values and recorded quite high interest payment levels. For example, the bond code TNR.L.20.27.002 has an issuance value of VND 400 billion, interest rate of 8.7%/year. As of the end of 2024, the principal balance of this code remained unchanged at VND400 billion. In 2024 alone, the company paid VND34.8 billion in interest for this bond lot.

Codes such as TNR.BOND.01.2020.01, TNR.BOND.01.2020.02, TNR.BOND.01.2020.03, TNR.BOND.01.2020.04, TNR.BOND.01.2020.05... are all bond lots with a fixed interest rate of 12.6%/year, belonging to the highest interest rate group in the entire issuance portfolio of enterprises. This is also an interest rate that is among the top in the corporate bond market, showing great capital cost pressure of enterprises.

Most of the remaining bond lots have values ranging from 45-50 billion VND, with common interest rates at 12.6% and 8.5%, 8.7%, 9.1%. In 2024, the interest that TNR Holdings will pay for each bond code ranges from several billion VND to more than 10 billion VND, depending on the interest rate and issuance time.

The above figures show the significant financial pressure that businesses are facing in the context of the bond market going through a difficult period, forcing issuers to balance cash flow cautiously to ensure their obligations to investors.

The above 141 bond codes are only a part of the total of tens of thousands of billions of VND of corporate bonds that TNR Holdings has mobilized in the market, showing a large capital scale and a significant challenge in maintaining liquidity.

Continuously extending bond debt

In the period of 2019-2020, TNR Holdings issued nearly 300 bonds to the market, successfully mobilizing tens of thousands of billions of VND. These lots are mainly for 3-5 year terms. Many lots have expired, some have been extended for payment and the successful extension period.

In 2021, the enterprise will continue to issue 5 more bonds including: TNRCH2128001, TNRCH2128002, TNRCH2128003, TNRCH2128004, TNRCH2128004, all issued in the last quarter of the year with a term of 7 years, interest rate of 10%/year, total issuance value of VND 2,300 billion. Since then, TNR Holdings has not issued new bonds.

In 2024, TNR Holdings continuously negotiated with bondholders to extend the repayment period and extend the bond debt by 2 years. A series of bond lots were successfully extended by enterprises.

Debt to be paid is 11 times higher than equity

TNR Holdings' financial report for the first 6 months of 2024 recorded that as of June 30, 2024, the company's payables were at VND 28,678 billion, a sharp increase of 50% over the same period last year and 11 times higher than equity. It can be seen that the enterprise is using a huge financial leverage, for each equity, TNR Holdings owes more than 11 VND.

Bond debt alone is VND9,308 billion, down slightly by VND9,424 billion in the first 6 months of 2023.

Meanwhile, the business results in the first 6 months of 2024 recorded a serious decline, with after-tax profit from nearly 85 billion VND in the same period last year decreasing to just over 5.6 billion VND, or about 93%. The return on equity (ROE) also decreased sharply from 3.86% to only 0.22%, showing very low capital efficiency.

In general, TNR Holdings is facing financial pressure, with a large debt burden in the context of declining profits.