Transport investors worry about incorrect information about financial situation

The appearance of incorrect information about the nature of credit loans for PPP road and highway projects is causing difficulties for many transport investors.

Transport investors worry about incorrect information about financial situation

The appearance of incorrect information about the nature of credit loans for PPP road and highway projects is causing difficulties for many transport investors.

Hai Van road tunnel is being operated and exploited by HHV.

According to statistics from the Ministry of Transport , in the period 2016 - 2020, the capital demand for investment in transport infrastructure development is about 1,010,000 billion VND, but the state budget only meets about 28%.

In that context, resources from the private sector have shared the burden with the state budget, contributing to the formation of large, modern transport infrastructure projects.

Specifically, successfully implemented transport infrastructure projects under the PPP method include: Phap Van - Cau Gie Expressway (VND 8,475 billion); Van Don - Mong Cai Expressway (VND 9,100 billion); Bac Giang - Lang Son Expressway (VND 12,188 billion); Ha Long - Van Don Expressway (VND 13,000 billion); Deo Ca - Co Ma - Cu Mong - Hai Van 2 road tunnel chain (VND 21,612 billion) ... have contributed to changing the face and promoting the socio-economic development of localities in particular and the whole country in general.

However, most of the above BOT projects were implemented before the PPP Law took effect (January 1, 2021), without the participation of state capital, so, in addition to the investor's equity capital as prescribed, which usually accounts for 10 - 15% of the total investment, the rest must be mobilized from credit loans.

Mr. Nguyen Quang Huy, General Director of Deo Ca Transport Infrastructure Investment Joint Stock Company (HHV), said that before receiving bank capital, the BOT transport projects invested by this unit must go through the process of legal assessment, investor capacity, feasibility and project efficiency. While the equity capital participating in the projects only accounts for 10 - 15% of the total investment, in reality, the equity capital/total assets of HHV is up to 24%.

In the recent past, the projects invested by HHV have been put into operation, creating stable revenue and growing steadily every year; the source of money, cash flow is stable, and the debt repayment schedule has also been arranged in accordance with the project's capital recovery fee collection period.

Therefore, loans and interest are paid in full and on time without affecting cash flow, production and business activities as well as shareholders' interests. This information is clearly stated in the project's financial plan, credit contracts and prospectuses publicly announced to shareholders and potential investors.

“Long-term debt is a very common problem in enterprises investing in transport infrastructure. Loans can last from 10 to 25 years, or longer depending on the project's payback period,” said a representative of HHV.

However, in recent times, not only HHV, but many transport investors have also faced inaccurate information about the nature of loans from capital mobilization for PPP projects, which has damaged the image, reputation and operations of businesses.

HHV is currently an investor in large-scale and total investment transport infrastructure projects in Vietnam. At the same time, it is a public company listed on the Ho Chi Minh City Stock Exchange with the stock code HHV. As of September 30, 2024, HHV recorded a long-term loan balance of approximately VND 18,900 billion.

This is a loan to invest in projects such as the Deo Ca tunnel chain, Cu Mong, Hai Van 2, Bac Giang - Lang Son ... The collateral for the loans is the right to collect tolls at the projects and currently these projects are all operating, collecting tolls with stable cash flow, growing steadily every year at 10-15% per year.

HHV representative said that HHV's production and business results in the period of 2019 - 2023 are very positive with revenue increasing 4 times and after-tax profit increasing 10 times compared to 2019.

Accumulated in the first 9 months of 2024, HHV recorded consolidated revenue of VND 2,298 billion, profit after tax reached VND 367 billion, up 25.9% and 18.8% over the same period last year, respectively.

Source: https://baodautu.vn/nha-dau-tu-giao-thong-lo-ngai-thong-tin-chua-dung-ve-tinh-hinh-tai-chinh-d229564.html