Long Giang Land: Heart – Strength to become a professional real estate developer

25/05/2019

The strong and decisive encroachment to real estate sector of Long Giang Land has impressed investors when only in a short time, this brand has affirmed its position in the market as a professional real estate developer, with 2 projects completed in Hanoi and Ho Chi Minh City and a series of other projects going to commence.

The wind must blows, the boat will push off

Over the past three years, Long Giang Land has just officially listed its name on real estate owners possessing its own brand with the launch of Rivera Park Hanoi and Rivera Park Saigon project. But with customers and investors, Long Giang Land is not a strange name. It is because in fact, before being “included” in the list of real estate developers, Long Giang Land has been familiar as a reputable contractor, who “quietly” stands behind the well known works such as The Manor – My Dinh, Hanoi; Cherwood Residence Hotel, Rex Hotel, Grand Hotel in Ho Chi Minh City, etc.

After Xuan Thuy Tower Apartment Project – 173 Xuan Thuy, Cau Giay, Hanoi which is contributed capital successfully by Long Giang Land, it found that it is impossible to stand forever in the role of “hired labor” and must actively change prior to being forced to change if it wants to develop stronger and more sustainably, Mr. Le Ha Giang, Chairman of Long Giang Land decided to restructure his enterprise to move into the field of investment in developing real estate projects.

Despite of being experienced in construction, but in the eyes of the market, Long Giang Land is still a new rookie. However, Long Giang Land is determined to make itself a boat full of enthusiasm and determination to “set sail”.

And when Xuan Thuy Tower project – 173 Xuan Thuy, Cau Giay, Hanoi succeeded, it has demonstrated the its ability to build and develop, the chairman of Long Giang Land began to declare to completely encroach into real estate investment sector.

FROM THE STRATEGY
TRUE ORIENTED

Recalling, in 2014, when the real estate market started to “wake up” after a long “winter sleep”, Long Giang Land officially commenced the construction of Rivera Park Saigon project. Since the warming of the market, real estate has become vibrant, the housing demand has increased dramatically. Investors assess that this is a golden time to set foot in real estate.

However, opportunities always accompany with challenges, “where flowers bloom, where bees come”, in this attractive context, enterprises have caught the opportunity, landed massively on the real estate market, in addition to existing “names”. Mr. Le Ha Giang assessed that this is the time when there have lots of successful real estate businesses with big brands in the market. If taking into the mid-range and medium-quality segments, the profit margin is high but the competition is fierce, and it is difficult to solve the problem of brand affirming. Finally, chairman of Long Giang Land decided to choose a completely different direction. “I told myself, I have to make really good products, at cheaper prices. I decided to choose a difficult niche for not have to compete much and be on par with big names”- said Mr. Giang.

According to the old saying, Mr. Giang’s choice is based on the philosophy of “Profit – Harmony”. It is suitable for a long way but also a hard path!

Back to the story, in 2016, Rivera Park Saigon was officially launched. At this time, customers were still cautious about an “amateur” owner. It was not until the project was completed, to be able to “see” the project quality, just like in the advertisement, Long Giang Land really created resonance and prestige.

In 2017, the occupancy rate of Rivera Park Saigon apartment is up to 90%. The business results of an initial project have surprised investors because the success speed of Long Giang Land is so fast. Considering the time when the apartments supply is too abundant, the massive landfall of enterprises into real estate sector in addition to traditional names, it is the difference in the development orientation has brought about rapid success for Long Giang Land.

In 2018, Rivera Park Hanoi continues to launch on the market in the context of real estate is facing the condition of oversupply, lack of demand. At that time, frankly looking at Rivera Park projects, Mr. Le Ha Giang once said: “Our project is small in scale, not prime position, but has the advantage of low selling price and quality is certainly the best in the market”. However, what reassures investors and customers coming with Long Giang Land is its sincerity: “I know, with the reasonable price and the best quality, the profit margin will decrease, interest net decrease but that was the way in product series of Long Giang Land”.

Therefore, although appearing in the competitive time of the market, Rivera Park Hanoi is still becoming a project with the highest and fastest occupancy rate. With a large number of sold apartments, Rivera Park Hanoi is included in the Top 10 of projects mostly attracting cash flow organized by the Investment Newspaper.

The success of the 2 projects, Rivera Park Saigon and Rivera Park Hanoi has proved the orientation to make a difference in the market of Long Giang Land is absolutely right. The project quality must be standard – it is the first criterion that Long Giang Land determines that it must and surely achieve. Accompanied by 5-star quality, Long Giang Land offers a mid-range price, in line with the majority of investors’ funds. That brand positioning strategy, together with the commitment of “advertising is in line with reality”, it has made Rivera Park-branded projects to one of the biggest projects attracting cash flow.

…TO THE PERSON STEERING THE BOAT

A boat is hardly stand out to sea if it lacks an experienced and affirmed steering wheel. It is difficult for the boat to continue its journey as expected if lacking a deep philosophical foundation.

Those are absolutely true for Long Giang Land. The person behind the success of Rivera Park project as well as shaping the business brand is Le Ha Giang businessman.

Mr. Le Ha Giang once mentioned a core value that Long Giang Land has been pursuing, which is the “profit-harmony” philosophy. It is the sharing of benefit among the humanistic community of the enterprise itself, the sharing of benefits with investors and customers.

Sticking to that philosophy, Long Giang Land has gradually shaped its “5-star, 4-star” quality product series. And even when the project has been handed over, residents of Rivera Park are satisfied with what the developer is creating for the present and the future.

The bravery of the captain Le Ha Giang also lies in the mentality of an entrepreneur whose word is in line with action .

Recalling, at the time of newly appeared, Mr. Le Ha Giang announced his determination to bring the company into the Top prestigious owners in the market. His commitment is completely difference to real estate businesses in the market. It is not a commitment about the most prestigious real estate enterprise nor a dream to occupy the number 1 position in the real estate market. It is not also a shout of slogans for the public to see and celebrate. It is the commitment of a company leader to shareholders of Long Giang Land and its own investors. It is determining the right direction that you want to go, identify the destination you are ahead to based on the its own potential! Because of the view point of word is in line with action, “To know oneself is true progress”, Mr. Le Ha Giang firmly gave such commitment.

3 years later, with the constant growth from the report on business “health” of Long Giang Land, shareholders, investors and customers are assured of “partner”, “owner” that they have chosen.

Accordingly, in 2016, Long Giang Land’s revenue reached approximately VND 237 billion and VND 5.2 billion in after-tax profit. By 2017, Long Giang Land’s revenue has reached VND 830 billion, after-tax profit reached VND 96.9 billion. And 2018 is a year that marked a remarkable turning point of Long Giang Land. The 2018 income statement showed that LGL net revenue reached VND 1,294 billion (5.5 times higher than 2016’s revenue), completing 8% higher than the plan. After-tax profit reached VND 118 billion (22.7 times higher than 2016’s revenue). This is also the best growth fugure of Long Giang Land for nearly 20 years.

With continuous growth figures of 2018, the leader of Long Giang Land declared that: “Long Giang Land has officially affirmed its position in the real estate market as a professional real estate developer. Long Giang Land has also become member in the small group of real estate enterprises owning a series of projects in natiowide with 2 completed projects in Hanoi and Ho Chi Minh City ”.

From a new rookie stepping into the real estate market, the income statement figures of Long Giang Land are the clearest and most honest evidence of the maturity of this real estate business. This is also the answer to the three-year-old statement of Mr. Le Ha Giang when he decided to make Long Giang Land one of the most prestigious real estate enterprises with the best construction quality.

THE STEPS IN FUTURE OF LONG GIANG LAND

2019 is forecasted to be a difficult year for real estate businesses. Righ from January, 2019, credit for real estate began to tighten under the roadmap of the State Bank of Vietnam. Real estate businesses are forced to find alternative sources of capital.

Meanwhile, the present picture of the market is slow growth in demand but the continuous incrase of supply. The fierce competition among businesses, especially in the high-end apartments segment will continue to increase.

However, despite difficulties and challenges, the captain of Long Giang Land continued to affirm his determination to steer the boat.

Accordingly, regarding 2019 business plan, Long Giang Land set the target of parent company revenue to VND 1,400 billion, after-tax profit to VND 125 billion, company’s charter capital to VND 640 billion. Long Giang Land will accelerate the completion progress of investment legal procedures to start two new projects (Rivera Park Long Bien and Rivera Park Can Tho) in 2019 in Hanoi and Can Tho, continuing to expand the strategy of extending the Rivera Park brand along the S-shaped land. In order to achieve that goal, Long Giang Land will continue to maintain M&A strategy in real estate to increase land fund and new investment projects as well as restructuring HR apparatus.

Another centering point among targets set out by Long Giang Land in 2019 is to promote the liquidity of LGL stock. In fact, LGL shares were listed on the floor 10 years ago with 8 million stocks offered. At that time, LGL suddenly created a “fever” of prices for investors. However, at the time the stock market slowed down in the context of real estate crisis, prices of LGL stocks also went down as the general trend.

Responding to questions from shareholders, why LGL’s business is good but its shares have not been achieved result as expected, leader of Long Giang Land committed that it will attach importance to promoting relationships with investors.

According to the assessment of Saigon – Hanoi Securities JSC, in 2019, the consolidated after-tax profit of Long Giang Land reached VND 125.4 billion, the income per share (EPS) after dilution reached VND 2,134. With the present stock price, LGL is currently trading at a very low forward P/E, equivalent to 4.5 times. This means that LGL has not yet been evaluated its true value by the market.

Although this is a challenge and a long-term problem that Long Giang Land was forced to find a solution, but with the way this enterprise once steered the Rivera Park brand boat to the sea as more than 3 years ago, it is surely that, in the future, the commitment to a Long Giang Land leading in the construction quality as well as bringing LGL stocks into the list of good real estate enterprise stock will be clear.

Certainly, with a captain whose word is in line with action, Long Giang Land will gradually become a worthy real estate enterprise in the future.