Việt Nam Electrical Equipment Corporation's headquarters in Hà Nội. — Photo gelex.vn

HÀ NỘI — Việt Nam Electrical Equipment Joint Stock Corporation (Gelex) plans to issue nearly 293 million shares to increase charter capital.

The shares will be sold to current investors. Each share is equal to one purchase right and every shareholder will have the right to purchase six new shares for each 10 rights they have.

Gelex will set the price at minimum VNĐ12,000 (US$0.52) apiece, hoping to raise more than VNĐ3.5 trillion ($151.4 million) from the sale to raise charter capital to VNĐ7.8 trillion.

The deal will be discussed at the firm’s extraordinary shareholder meeting on December 29. If approved, it will be done by the end of June 2021.

In recent years, Gelex has continuously made borrowings to expand operations and enhance investments.

Those loans helped the company raise revenues annually from VNĐ8.6 trillion in 2015 to an estimate of VNĐ17.5 trillion in 2020.

Gross profit also rose from VNĐ1.1 trillion in 2015 to an estimated VNĐ2.5 trillion in 2020.

However, financial expenses soared from VNĐ75 billion ($3.24 million) in 2016 to an estimated VNĐ1 trillion in 2020, mostly because of the firm’s acquisition of Viglacera Corporation.

After the acquisition completes in 2021, total revenue and gross profit are expected to reach VNĐ33.4 trillion and VNĐ5.2 trillion in 2021, respectively.

Earnings per share (EPS) is forecast to rise to VNĐ1,500 apiece in 2021 from an estimate of VNĐ1,348 apiece in 2020.

The upcoming capital increase will serve the group’s planned projects such as two wind power projects in Quảng Trị Province and two hospitality projects in Hà Nội.

In addition, Gelex plans to widen its working capital by VNĐ415 billion and spend VNĐ800 billion restructuring and increase capital for its subsidiary Gelex Electrical Equipment JSC.

In July-September, Gelex reported nearly VNĐ4.75 trillion of net revenue, up 21 per cent on-year, and VNĐ218 billion in post-tax profit, down 5.2 per cent on-year.

In January-September, the corporation earned a combined net revenue of total VNĐ12.06 trillion, an annual increase of 9.6 per cent.

Nine-month post-tax profit dropped 7.89 per cent on-year to VNĐ641 billion.

Gelex is listing more than 488.2 million shares on the Hồ Chí Minh Stock Exchange with code GEX.

The company’s shares edged up 0.5 per cent to end Friday at VNĐ20,800 apiece.

Recently, Gelex has decided to sell 12 million treasury shares to employees at VNĐ12,000 apiece. — VNS