The total revenue in 2023 of 15 industrial park real estate enterprises with the largest total assets on the floor reached VND 52.767 billion.
Profits are pulled back
Statistical data from the Analysis Center, Agribank Securities Company (Agriseco Research), the total revenue in 2023 of the 15 industrial park real estate enterprises with the largest total assets on the floor reached VND 52.767 billion, Profit after tax recorded 10.418 billion VND, up 12% over the same period in 2022.
Entering the first quarter of 2024, data from Agriseco Research shows that the total revenue of the above 15 businesses recorded 11.484 billion VND, a slight increase of 1% over the same period last year. Meanwhile, total profit after tax reached 1.740 billion VND, down 17% over the same period last year. The reason for the decrease in profits is mainly because Kinh Bac Urban (code KBC) reported a loss of nearly 77 billion VND in the first quarter, while the same period in 2023 had a profit of 1.056 billion VND. If not including KBC, businesses in the industry recorded revenue of more than 11.332 billion VND and profit after tax reached 1.817 billion VND, growth of 24% and 75% respectively compared to the first quarter of 2023.
Explaining the business results, KBC said that in the first quarter of 2024, the Company lost more than 76,7 billion VND, mainly because in this period the Company reduced recording revenue from industrial park business activities and did not record revenue from industrial park business activities. Record financial income from investment transfer compared to the same period last year.
In addition, data from Agriseco Research shows that, for rubber businesses with industrial park segments including (GVR, PHR, DPR), business results in the first quarter of 2024 recorded a 25% decrease in profits compared to the same period last year. period last year due to a decrease in income from industrial park land compensation. However, unrealized revenue of industrial parks still remains high (11.659 billion VND) and will be the future revenue source of these enterprises.
Compensation prices for rubber plantation land are expected to increase from 2025
According to the perspective of the Analysis Center, SSI Securities Company (SSI Research), the cost of compensation for rubber tree planting land includes 2 components including the compensation price for rubber trees implemented according to the price prescribed by the Commission. Provincial People's Committee; and support costs of all kinds (including support for assets on land, support for remaining investment costs in land, support for severance allowance and support for ensuring housing and stabilizing life, production and fairness to those whose land is recovered). In particular, support costs account for 70-80% of the total cost of compensation for land on rubber trees.
According to the revised Land Law that will be applied in 2025, the valuation of land for perennial crops will be determined based on 4 methods close to market transaction prices. In particular, SSI Research believes that the income method most suitable for determining compensation prices for rubber tree planting includes factors such as revenue from garden exploitation in the last 3 years; Expenses for garden exploitation in the last 3 years; The discount rate according to the average 12-month deposit interest rate held by State Banks is over 50%.
In addition, SSI Research said they also compared past land compensation transactions on rubber trees in projects such as VSIP 3 - Binh Duong (unit compensation price of 2,5 billion VND/ha). , Nam Tan Uyen 3 - Binh Duong (compensation unit price 2,5 billion VND/ha), Minh Hung 3 - Binh Phuoc (compensation unit price 1,5 billion VND/ha), Hiep Thanh Industrial Park - Tay Ninh (compensation unit price of 1,3 billion VND/ha) is the basis for determining compensation for land on rubber trees for the following transactions.
“Based on current transactions and discussions with businesses in the industry, the cost of compensation for rubber plantation land is expected to increase by 30-50% compared to the cost of past transactions and applied according to Valuation methods from the revised Land Law. With increased site clearance compensation costs, we believe that gross profit margins of new industrial parks may decrease to 25-30% compared to more than 42% of currently operating projects", SSI Research commented.
