Like most real estate businesses, during the outbreak of the Covid-19 pandemic, Danh Khoi has faced many difficulties. However, thanks to the careful preparation of plans, Danh Khoi could still introduce projects to customers by online methods and achieved certain success.
According to real estate investors and traders, this is a great effort of Danh Khoi, and partly shows their potential and high adaptability to difficulties. Danh Khoi also prepared a plan to accelerate when the market moves into the new normal.
TheLEADER.vn discussed this situation with Nguyen Huu Quang, member of board of directors and vice general director of Danh Khoi Group.
Applying technology to business activities
The third quarter of 2021 has ended but the real estate market is still heavily affected by the Covid-19 pandemic. How does this impact on the business plan of Danh Khoi Group?
Nguyen Huu Quang: 2021 is considered a tough year for our economy due to the Covid-19 pandemic. Very few businesses can perform well. Most businesses faced the negative effects of the market.
Real estate is considered one of the industries being the most affected by the Covid-19 pandemic. From the beginning of the year to this moment, real estate companies have only been operating normally for about two months because of the Tet holiday period and the Covid-19 which has caused social distancing for months.
Many projects have had to postpone sales plans. The strict social distancing of Ho Chi Minh City and other provinces has caused business plans to be scrapped.
For corporations with strongly financial condition, they can still make progress if they have a contingency plan, but it is very difficult to survive for small ones and there are thousands of companies that have closed since the beginning of the year.
For Danh Khoi Group, like other companies in the industry, the Covid-19 pandemic has significantly affected our business plan. However, Danh Khoi had got a backup business plan that it has not only reduced some of the difficulties, but also achieved good results in the past time.
Can you elaborate on the backup business plans?
Nguyen Huu Quang: Danh Khoi saw the difficulties and predicted that the pandemic situation might last long, so we initiated a backup business plan. Typically, Danh Khoi has focused on transforming the business from direct sales to online product introduction during these times.
Empathy and Sharing is the message which has been expressed clearly from Danh Khoi staff to customers.
This is a message of humanity during the pandemic period, so customers have a trust in Danh Khoi and they have bought our products then during online launches.
Also, hundreds of products have been booked by customers through the online form at each time they are introduced. For example,in August 2021, we had an online introduction of Astral City - Binh Duong and Aria Block B - Vung Tau with very positive results.
In September 19th, Danh Khoi continued to introduce online to customers the Takashi Ocean Suite Ky Co - Quy Nhon, an apartment product with several positive effects on the market. We think these are unexpected successes in the circumstances of the intense pandemic in Ho Chi Minh City and the southern provinces.
Currently, Ho Chi Minh City and other localities are planning to reopen. How does Danh Khoi plan to accelerate in the last quarter of the year?
Nguyen Huu Quang: Now, more than 90 per cent of Danh Khoi's employees have been vaccinated that we are ready for the reopening date. We usually talk to each other that “This is the plan for the new normal period”.
Projects such as Lagi New City – Binh Thuan, Astral City - Binh Duong, The Aston - Nha Trang, Takashi Ocean Suite Ky Co - Quy Nhon, Aria - Da Nang, The Royal - Da Nang, and Aria Block B - Vung Tau … are all ready for the next online presentation to customers in the near future.
However, depending on the pandemic progress as well as regulations of the government on controlling it, Danh Khoi may organize more events and introduce projects directly to customers.
Or we could flexibly combine online and direct product demonstrations. In short, depending on the situation as well as the control of the pandemic, Danh Khoi will choose the most suitable method and give the best conditions to customers that help them can get access to our product chain easily.
Profit in the third quarter may reach more than VND100 billion
Recently, Danh Khoi's stock (HOSE: NRC) was listed as an ineligible stock for margin trading. Could you tell me more about this?
Nguyen Huu Quang: The business of real estate companies has been greatly affected by the epidemic. Some companies are quite passive and almost difficult to prepare well. This has affected the business income of companies.
For Danh Khoi, we expected to launch products and projects to customers in May and June 2021 but it’s fail because the epidemic caused social distancing in Ho Chi Minh City and other provinces from the end of April 2021.
Instead of direct product launching, Danh Khoi tries to use online platform to launch. However, it requires a transforming period. That's why Danh Khoi's business was interrupted in the second quarter of 2021.
In addition, Danh Khoi did not book the remaining revenue from the previous year in the first and second quarters of 2021. So, it generates a loss in financial reports in the past two quarters. However, according to the regulations, when Danh Khoi’s business is profitable, HNX will consider and grant margin trading back to our stock code.
Therefore, with our achieved profit and the remaining revenue from previous years in third quarter of 2021, NRC will certainly be considered and approved by HNX for margin trading.
Currently, the online transactions are in the rush to record the data, if it is quick and in time, our profit can reach about VND100 billion.
We will try to recognize the revenue from our biggest sales in the third quarter of 2021. After Ho Chi Minh City and other provinces are gradually stop social distancing, we expected to achieved higher profits in the fourth quarter of 2021. We expect and try to achieve the best of profit target at the end of December 31, 2021 to meet investors' expectations.
Ready for announcement of big deals
At the 2021 annual general meeting, Danh Khoi's representative said that he would implement large plans of restructuring and merger of the Danh Khoi Group's ecosystem for NRC. So, how is this plan currently being implemented?
Nguyen Huu Quang: This year's general meeting of shareholders set a task for the board of directors (BOD) and the board of management (BOM) to implement plans of the restructuring and merger the ecosystem of Danh Khoi Group into NRC. This is still being worked on.
Our BOD directed BOM to do that plans immediately after the resolution of the general meeting of shareholders was issued. However, it will take time to appraise and review our group's member companies.
The complicated epidemic and the social distancing are the causes for the interruption of review work. Our BOM and BOD are still actively implementing and try to achieve the target in 2021.
However, the epidemic situation is an important factor for the completion of the plan and the organization of the general meeting of shareholders to report the results and obtain opinions from our shareholders.
We always hope that the epidemic situation will be controlled soon and people's movement will be normal so that our business and plans can do normally to achieve our goals set by the general meeting of shareholders.
It is said thats Danh Khoi is in the final steps before announcing a deal with a large Japanese real estate corporation. If it’s right, can you tell me more about this deal?
Nguyen Huu Quang: The scooperation with foreign partners is still going very smoothly despite the complicated epidemic situation in Ho Chi Minh City in particular and our country in general.
NRC's cooperation with foreign partners in recent years has been very good and we have always been trusted by investors. We has focused on domestic and foreign IR activities. That's why NRC is known by foreign investors, especially large corporations.
In fact, we have completed about 80 per cent of the deal. We hope to complete remaining works in October or early November.
Since we are still in the process of cooperation and the two parties have signed a confidentiality document, please allow me to keep confidential until it is completed or officially announced.