Dragon capital boosts ownership in Đức Giang chemical group, eyeing major project expansion

April 12, 2024 - 02:34
This move has resulted in Dragon Capital's ownership stake in Đức Giang Chemical Group increasing from 4.99 per cent to 5.03 per cent of the company's charter capital.


Workers of Đức Giang Chemical Group JSC (DGC) pack products at their Hà Nội factory.  — Photo Đức Giang Chemical Group JSC

HÀ NỘI Foreign investment fund Dragon Capital has revealed its successful acquisition of an additional 150,000 shares of DGC stock from Đức Giang Chemicals Group JSC.

The transaction involved its two member funds, Amersham Industries Limited purchasing 100,000 shares and Vietnam Enterprise Investments Limited, acquiring 50,000 shares.

This move has resulted in Dragon Capital's ownership stake in Đức Giang Chemical Group increasing from 4.99 per cent to 5.03 per cent of the company's charter capital, making it a significant shareholder in the chemical conglomerate.

Dragon Capital's increased ownership comes at a strategic time as Đức Giang Chemical Group is preparing to commence the construction of the Nghi Sơn Plasticiser Chemical Plant Complex in Nghi Sơn Industrial Zone, Thanh Hoá Province, scheduled to begin in June.

The project's total investment is estimated at VNĐ12 trillion, with VNĐ10 trillion allocated for the initial phase, making it the largest investment project in Đức Giang Chemical Group's history.

Once operational, the plant complex is projected to produce annually 150,000 tonnes of concentrated sodium hydroxide (NaOH), 150,000 tonnes of PVC resin, 34,000 tonnes of calcium hypochlorite (OCI) bleach powder, 1,000 tonnes of Chloramin B disinfectant, 30,000 tonnes of polyaluminum chloride (PAC) water treatment chemicals, 15,000 tonnes of 31 per cent hydrochloric acid (HCI) and 10,000 tonnes of Javen 10 per cent bleach.

Đức Giang Chemical Group has highlighted the significance of this project, as many of its output products are in high demand and currently face supply shortages in the domestic market. Additionally, the project benefits from its strategically advantageous location near the deep-water Nghi Sơn Port and abundant limestone mines, which serve as the primary raw material source for PVC resin production.

Đào Hữu Huyền, Chairman of the Board of Directors of Đức Giang Chemical Group, has emphasised the project's importance, referring to it as the company's "trump card" for the foreseeable future.

According to a recent assessment by KB Securities Vietnam (KBSV), the Đức Giang-Nghi Sơn Chemical Complex is expected to be completed in the second quarter of 2025. It is projected to contribute approximately VNĐ670 billion to Đức Giang Group's revenue in 2025, with a gross profit margin of 12 per cent. Subsequently, revenue is anticipated to steadily increase, reaching approximately VNĐ1.5 trillion per year once the complex reaches its maximum production capacity.

Đức Giang Chemical Group has set a target of achieving a total revenue of VNĐ10.2 trillion in 2024, representing a 4.7 per cent increase compared to the previous year. The estimated post-tax profit for the year is VNĐ3.1 trillion, a 4.4 per cent decrease compared to 2023, with an anticipated dividend payout ratio of 30 per cent. VNS