Owning a series of real estate projects in potential locations, Tecco Group operates ineffectively and only earns a small profit, not equivalent to the scale of assets up to trillions of dong.
Continuously increase charter capital and assets
Tecco Group Joint Stock Company was established in late 2001 with an initial charter capital of 100 billion VND by Mr. Nguyen The Manh (born 1953) as Chairman of the Board of Directors (BOD). The company is headquartered in Thu Duc, Ho Chi Minh City and operates in a multidisciplinary manner, but is mainly known in areas such as construction investment - housing and resort real estate.
By December 2016, the company increased its charter capital to VND 200 billion and by the end of 2017 it was 500 billion. The most recent increase in equity to VND 2,000 billion was changed in June 2018.
In recent years, the size of this group has continuously increased with total assets at the end of 2019 reaching VND 3,346 billion, an increase of 35% in a year and a half times compared to the end of 2017.
The equity of this business also doubled to 805 billion by the end of 2019, but this number is only equivalent to a quarter of the size of total assets. This shows that most of Tecco Group's assets are financed from debt capital with the ratio of liabilities to total assets up to nearly 77%.
The scale is up to trillions of dong, but Tecco Group only made a profit of 22 billion dong in 2019, even 2 years ago, it still had consecutive losses. Return on total assets (ROA) and return on equity (ROE) are only 0.6% and 2.7% respectively, indicating that business performance is not high for this business. .
A remarkable positive point is the high growth in revenue each year. In 2019, Tecco Group's revenue reached 805 billion VND, an increase of 32% compared to the previous year. This figure in 2018 even went up to 78%.
The "centipede" is ineffective
Tecco Group currently has projects in 18 provinces and cities nationwide, notably Tecco Thanh Tri, Tecco Do Son Hotel Spa, Tecco Lao Cai, Tecco Towers Thanh Hoa, Tecco Complex Thai Nguyen, and Green View 3 cities. Vinh City, Tecco Hanoi, Tecco EverGreen Resort - Da Lat, hotel and villa chain tourism project Nam Hung (Cam Ranh - Khanh Hoa), Sunbay Park Hotel & Resort (Ninh Thuan), Dak Lak hydropower ...
With the spread scale, Tecco Group has divided the tasks into the "centipede" as member units in each locality to focus on implementing projects in the area. However, most of these companies are ineffective, leading to poor overall results of the group.
One of the largest member units of the group is Tecco Hanoi with total assets up to the end of 2019 of up to VND 1,559 billion, although the equity is only VND 9 billion. In 2019, Tecco Hanoi will start generating 587 billion VND in revenue, thereby earning a net profit of 14 billion VND. It can be seen that this is quite a modest number if looking at the series of projects that these businesses have been implementing in Hanoi such as Tecco Hanoi, Tecco Skyville Tower, Tecco Skyville Tower or Tecco Diamond.
Some of the member units in other localities of the group such as Tecco Thanh Hoa, Southern Tecco, and Tecco Truong An ... all underperformed in the past year, leading to loss eroding equity. .
