CORPORATION INTRODUCTION
Introduction
Legal international name: CT LAND CORPORATION
Legal vietnamese name: CÔNG TY CỔ PHẦN BẤT ĐỘNG SẢN CT
Head office: 117 Nguyen Dinh Chieu, Vo Thi Sau Ward, District 3, Ho Chi Minh City, Viet Nam
Website: https://ctland.com.vn/
Email: info@ctland.com.vn
Charter capital: 4,200,000,000,000 VND (in words: four thousand two hundred billion Vietnamdong)
Business sectors: Multi-industry development company, service with 4 main industries including:
1.2 Brief history and development of CT Land
CT Land Corporation was established as a corporation in charge of real estate under
CT Group aims to be a leading urban developer, with CT Land specializing in Transportation Oriented Development (TOD) This approach integrates real estate development with transport infrastructure, forming a foundation for comprehensive urban planning Backed by over 30 years of continuous evolution and support from CT Group, CT Land has established itself as a premier and unique real estate developer in Vietnam, focusing on Transportation Oriented and Integrated Townships Development.
From the initial registered charter capital of only 6 billion VND, until now CT Land's charter capital has reached 4,200 billion VND.
To support its rapid growth, the company has implemented a centralized cost center system alongside multiple profit centers, leading to a significant reduction in operational costs In line with international best practices, CT Land has also adopted the latest IFC Corporate Governance standards.
CT Land operates nationwide, with its headquarters situated in Ho Chi Minh City and over 30 branches and transaction offices spread across various provinces and cities.
Mission – Core values
CT Land aims to develop sustainable cities powered by 3 key factors:
Deliver the dream working environment, the basis for comprehensive human development
CT Homes, also known as "DIYAS," is pioneering a technology-driven housing solution aimed at the affordable housing sector To meet the significant demand for affordable housing, CT Land aims to deliver 100,000 studio apartments between 2021 and 2025, with a long-term goal of providing up to 1,000,000 units by 2045.
CT Town specializes in projects covering land sizes of under 3 hectares, strategically situated in prime areas within Ho Chi Minh City’s districts These locations include key arterial roads like Pham Van Dong Avenue and Ha Noi Highway, as well as proximity to Ring Road 2 and Metro Lines No 1 and 2.
CT World is the strategic product line of CT Land, leveraging over 30 years of expertise from CT Group This initiative combines master planning proficiency, in-depth market understanding, and extensive development experience to create a comprehensive long-term strategy.
COMMERCIAL REAL ESTATE different scale retail establishments (i.e retail chains, Mega Mall, Commercial Food and Entertainment Centers ) fostering a successful ecosystems for its townships and mega townships
CT Com provides customizable commercial assets with flexible layout designs to meet various business needs, ranging from 10 m² to 200,000 m² in floor area Our offerings include commercial, office, and logistical spaces situated along prominent commercial and financial corridors in major cities Additionally, we present tourism projects that reflect a philosophy of solidarity and harmony between people and nature.
Business Structure
Playing a powerful role of real estate segment of CT Group, the scale and organizational structure of CT Land is extremely clear and professional.
General shareholders: the owners of CT Land, provide financial backing for potential dividends (profits) of the corporation.
Board of directors: to recruit, keep track, direct the company’s plans.
CEO/President: to be responsibilities for their major department in a whole, manage the operation.
To advise and assist the Directors in synthesizing, developing and implementing work programs and strategies; Synthesize planning, finance, investment in development of science, technology and innovation.
Manage revenue, quantity, liabilities, inventory, fixed assets
To monitor and check the quality of work and products of other departments to provide customers with high quality service.
Building PR and marketing strategies for products in each segmentation…
3.2 Position during the mid-course internship and duties undertake
The financial force is primarily divided into two departments: Finance and Accounting, with a focus on the Finance department The Back office plays a crucial role in preparing company statements, recording transactions, and setting product pricing, while also supporting the Front office in customer interactions.
Right from the beginning of the internship at CT Land Corporation, the author was assigned by the Finance Manager – Nguyen Thi Minh to undertake the following tasks:
To have basic understanding of legal brief of Real Estate projects, the author would regularly research the relevant documents and related laws/regulation.
To get enough documents to standardize a dossier, the author had the opportunity to contact other departments.
The Head of Department will evaluate the author's knowledge and research skills to ensure they can effectively manage and communicate information about specific company projects and products During this process, the author will gain direct access to essential data, including sales performance, financial statements, and relevant regulatory procedures.
The author gained valuable insights into the corporate bonds issued by CT Land Corporation through assigned tasks, which significantly contributed to the completion of this report.
Business situation period 2018 – 2021
Between 2019 and 2021, the economy, particularly the real estate sector, faced significant fluctuations due to the COVID-19 pandemic, which notably affected business conditions The accompanying table illustrates these impacts.
Source: Consolidated Financial Statements in 2018,2019,2020,2021 of CT Land
In 2019 City Land witnessed remarkable growth in Total Assets revenue and profit Total Access were recorded at 7167.3 million VND, 33.11% higher compared to
2018 this increases due to a series of mergers and Acquisitions of its subsidiary companies Consequently, the company makes significant progress concerning operating revenue.
By the end of 2020, CT Land's bank loan to total assets ratio stood at a mere 6%, with no outstanding bonds, reflecting the outstanding loan balance of its Member Companies for project implementation According to the Credit Information Center (CIC), CT Land has maintained a clean credit record with no outstanding debts in the past five years, significantly lower than the industry average of approximately 60% This indicates strong financial potential and substantial room for growth in the upcoming period.
CT Land has experienced an astounding revenue growth rate of 2121.9%, driven by the launch of new projects and the operationalization of existing ones, which have significantly contributed to the collection of short-term receivables from customer sales and services.
In 2020, CT Land faced significant challenges, experiencing a revenue decline of over 57.6% and an 85% drop in profit before tax, totaling only 95.78 billion VND, primarily due to the adverse effects of the COVID-19 pandemic on the broader industry Despite these setbacks, the company has leveraged its experiences from 2020 to develop contingency plans and closely monitor market conditions As a result, 2021 has shown signs of recovery for CT Land, indicating a positive outlook, albeit modest.
CORPORATE BONDS ISSUANCE PROCEDURE IN CT LAND CORPORATION
Analysis of corporate bonds issuance procedure in CT Land Corporation
Issuance agency: Bao Viet Security ar value: 100,000,000 VND/bond
Approvement Adj ust me nt
Step 1 Fin Dep cooperates with the Issuer to develop and submit the plan of issuance corporate bonds
In alignment with the business plan and development strategy for CT Land projects, we aim to implement a corporate bond issuance plan to raise capital essential for project construction and reinvestment.
FD will present the corporate bond issuance plan to the Assistant General Director and Board of Directors (BOD) If deemed unsuitable, the BOD will request adjustments; however, if the plan meets their criteria, it will receive approval.
Step 2 Conduct bond issuance procedure
FD registers business information on the Stock Exchange (HNX or HOSE):
+ Issuer registers email of the Stock Exchange.
+ The issuer registers to use the corporate bonds specialized website.
FD and Issuance agency directly work together (consultants and issuance agency) FD will collect company information (the Issuer) for the disclosure.
+ Securities company advises on the organization and implementation of procedures related to bond issuance.
+ FD prepares full legal procedures for projects related to bond issuers.
FD/Issuers signs a number of contracts with securities companies:
+ Consulting contract and bond issuance agency.
+ Agency contract for registration, depository, payment and management of Bond transfer.
Securities company plays the role:
+ Consult and review necessary legal procedures.
+ Consulting on the release plan.
+ Underwriting of Bonds Issuance / Intermediaries for buying and selling Bonds.
+ Distributing Bond products thanks to a diverse network of institutional and individual customers.
+ Prepare bond purchase and sale documents and guide the issuer of the procedures after the bond issuance.
FD/Issuers collaborated with the Bank to establish multiple contracts, including an Account Management Contract for handling funds from bond issuances, a Guaranteed Asset Management Contract, and a Mortgage Contract for securing collateral, which involved notarization and registration of transactions with relevant authorities.
Step 3 Disclosure before the offering
The Corporation has announced the issuance of Bonds for investors, with relevant information disclosed to the Stock Exchange The enterprise is required to complete the distribution of these bonds within 90 days from the date of disclosure.
- Securities companies and FD/Issuer conduct a research and make a list of investors wishing to purchase Bonds.
Bonds can only be purchased by professional investors, which include commercial banks, financial firms, and securities companies Additionally, companies must have a charter capital exceeding 100 billion VND or be listed or registered for trading Individual investors are required to hold listed or registered securities valued at a minimum of 2 billion VND or possess a taxable income of at least 1 billion VND in the most recent year.
Provide and clarify information for investors, guide the procedure for buying Bonds for investors When an investor decides to buy a bond, processing as follow:
+ Bond purchase and sale Contract.
Investors contribute funds to purchase bonds based on an agreement established between the investor and the issuer, as well as the terms set by the bank managing the creditor's account.
Securities Company confirms ownership of Bonds and sends depository information an issue the Certificate of Bond ownership to the Buyer after the Buyer has completed the payment.
Step 5 Report on Bond Issuance Results
Report the results of bond issuance to the Stock Exchange within 10 days from the end of the bond issuance The official report would be notified on the specialize website.
Step 6 Follow up after bond issuing
The FD/Issuer conducts quarterly monitoring and reporting to the Stock Exchange, while collaborating with the account management bank to effectively manage the proceeds from bond issuance and ensure project disbursement occurs only when sufficient and appropriate payment documentation is available.
Step 7 Summarize and save documents
The FD/Issuer regularly oversees and fulfills bond principal and interest payments as per agreements, while providing essential disclosures and reports to bondholders, depository institutions, and the Stock Exchange Additionally, the Issuer, FD, and AD collect and maintain all pertinent records in compliance with CT Land regulations.
A commitment involves agreeing to pay either the full or partial interest and principal upon maturity, utilizing the issuer's assets or third-party assets, in compliance with legal regulations governing secured transactions.
The collateral for the Léman Cap Residence project in Vung Tau includes land use rights and future assets, with a contract value assessed by Viet Nam Assessment and Evaluation Assets Joint Stock Company (VAAE).
Additional measures: payment guarantee by CT Land Corporation.
The evaluation of corporate bonds issuance procedure in CT Land Corporation 22 1 Strengths
The bond issuance process is crucial for companies looking to raise capital effectively By leveraging their reputation and offering attractive yields, the company successfully attracted significant investment from bond buyers in the market This strategic move not only enhances corporate profits but also supports major projects like the Metro Star initiative Looking ahead, the company anticipates a revenue surge, projecting earnings of 8,600 billion by 2025, despite a potential impact on the asset-to-capital ratio.
The Finance Department operates with a balance of independence and collaboration, empowering committee members with self-determination in task assignments Members are encouraged to connect flexibly for assistance and are authorized to address incidents within their capabilities They can also seek support from colleagues before escalating issues to senior management, including the department head or CFO.
In 2021, real estate companies issued bonds valued at approximately 200 trillion VND, representing around 33.16% of the total corporate bonds issued Furthermore, the real estate sector holds a significant market capitalization of about 1.56 quadrillion VND, which is equivalent to 21% of the overall market value.
In April 2022, the real estate industry faced significant challenges, exemplified by Tan Hoang Minh's mobilization of VND 10,000 billion from bonds Despite the banking sector dominating the domestic bond market with a 90.7% share, there were no new bond issuances from real estate companies Consequently, the total value of bonds in the market fell to VND 16,472 billion, marking a 23.2% decrease from the previous month.
As a real estate company, relying solely on bond issuance has proven insufficient to meet financial demands Given the industry's significant capital requirements, it is essential to diversify funding sources Consequently, strict regulations on bond issuance are necessary to ensure proper utilization of funds and prevent market manipulation.
Tightening bonds issuance regulations: Decree No 153/2020/ND-CP dated December
On December 31, 2020, regulations were established that limited the private offering and trading of corporate bonds in the domestic market, as well as the issuance of corporate bonds internationally These restrictions affected various aspects, including the issuer and the intended purpose of the bond issuance A common method of mergers and acquisitions (M&A) involves either the acquisition of shares or the purchase of a project.
CT Land, a private issuer of corporate bonds, faces challenges due to Decree 153, which impacts its financial stability Currently, the company is focused on two main projects that remain incomplete, leading to revenue fluctuations tied to construction progress and a low liquidity ratio The tightening of state bond issuance regulations is likely to exacerbate these difficulties for CT Land in the future.
CHAPTER 3: LESSON LEARNED AND RECOMMENDATIONS FOR
IMPROVING THE EFFECTIVENESS OF CORPORATE BONDS ISSUANCE PROCEDURE IN CT LAND CORPORATION
Lesson learned from the practice study and the internship period
During my internship at CT Land Corporation as a finance intern, I gained valuable insights into business operations and had the chance to apply my university knowledge in a practical setting The supportive staff provided enthusiastic guidance, offering important tips and sharing their own work experiences, which helped me feel comfortable and confident throughout the internship.
Accordingly, the author has accumulated a number of lessons for himself as follows:
During the university lecture, the author gained theoretical knowledge on bond analysis, evaluation, and issuance, but the internship at a real estate company provided practical insights into the issuance process Initially, the author faced challenges in understanding the procedural steps and struggled with professional report writing The complexity of real-world bond issuance contrasted sharply with academic theory, leading to confusion However, with the enthusiastic guidance of Team BO, the author acquired valuable experiences in various operations, including M&A, IPO, DD, and FS, enhancing their understanding of the real estate sector and the role of industry experts.
Recommendation for improving the effectiveness of corporate bonds issuance
Phuong Dong Garment Joint Stock Company has demonstrated strong management support and effective interdepartmental collaboration, which facilitates the delivery service for forwarders However, to enhance efficiency and effectiveness further, the implementation of specific solutions is necessary.