IDICO CORPORATION - JSC

The subject - Idico is one of the largest industrial park developers in Vietnam. According to the annual report 2023, by the end of that year, Idico invested in and managed 10 industrial parks in Vietnam with a total area of about 3,267 hectares, comprising 7 Industrial parks in the South and 3 industrial parks in the North stretching across the Dong Nai, Ba Ria - Vung Tau, Long An, Vinh Phuc, Bac Ninh, Thai Binh Provinces. With a focus on developing industrial real estate, Idico plans to expand an additional 2,430 - 2,820 hectares of industrial park land in the upcoming years. In addition, electricity generation and distribution is also an important business segment of Idico. With the orientation of being autonomous in power sources in industrial parks, Idico has been continuing to invest in the construction of 110/22 kV transformer stations and 22 kV power grid systems to distribute and trade power to meet customer demand. Among them, 110/22 kV transformer stations in Tuy Ha and Nhon Trach 5 Industrial Parks have been operated and Idico is continuing to invest in a 110/22 kV transformer station in Huu Thanh Industrial Park. In 2023, the Huu Thanh electricity substation and distribution network project began to record revenue by distributing 1,782 MWh of electricity to customers. Most prominently, Idico has also developed renewable energy sources, especially solar energy in industrial parks and hydropower plants. In 2023, the subject completed 2 solar power projects with a total capacity of 2.3 MWp. By 2026, via its subsidiary - Idergy, Idico will develop 100 - 120 MWp of rooftop solar power for its industrial park infrastructure. Besides these aforementioned main business segments, residential & commercial real estate (residential area, social housing projects, etc.) and other industrial park services provision (clean water provision, wastewater treatment, construction, etc.) are also business segments but only account for low proportion in Idico’s revenue structure.
At the Annual General Meeting of Shareholders 2024, Idico's Board of Directors also evaluates 2024-2025 as a favorable time to prepare conditions to seize opportunities to develop industrial park projects in potential locations. Mr. Phan Van Chinh - Deputy General Director also said that this is the golden time to develop industrial park projects. The goal in 2024 for Idico is to lease 145 hectares of industrial park land (this is all the area to attract new investment in 2024) and about 50,000 square meters of factory for rent. In addition, Idico focuses on completing the legal framework to gain approval for Tan Phuoc 1 Industrial Park (470 hectares in Tien Giang Province) to deploy in 2024 and create motivation for development from 2025. In addition, the company is going through legal procedures to prepare to create a land fund of about 2,000 hectares in Hai Phong, Ninh Binh Provinces, and some other localities. The total investment value for the year is expected to be VND 3,134 billion, an increase of 140% compared to 2023, focusing on industrial park projects at the parent company and urban housing projects, industrial parks, hydroelectric power, and energy projects at its subsidiaries in which Idico holds over 50% of charter capital.
Also at the Annual General Meeting of Shareholders, Idico approved the dividend plan for both 2023 and 2024 at a rate of 40%. The subject has a business plan with an expected revenue target of VND 8,466 billion and a pre-tax profit of VND 2,502 billion, an increase of 17% and 22%, respectively compared to 2023 performance. According to the assessment of a number of financial institutions, Idico could completely exceed its set business plan with strong growth momentum from the industrial park real estate business segment, along with a potential residential & commercial real estate business segment. For industrial park real estate, Idico signed MOUs (Memorandum of Understandings) for land lease at 5 industrial park projects with a total expected lease area of ​​100 hectares. This is the foundation to ensure the subject’s handover and revenue recognition of industrial park real estate in 2024. With a large backlog base from officially signed MOUs and contracts, the period 2024 - 2025 will be a "boom" period for Idico’s land handover at most existing projects. At the same time, in the context that rental demand continues to exceed supply, industrial park land rental prices in the company’s projects have shown an increase in recent years. The industrial park land rental price this year may increase by 7% - 10% compared to the average level of 2023. For residential & commercial real estate business segment, the revenue from this segment is forecasted to increase 4 times compared to 2023, thanks to the growth momentum from the handover of 2.2 hectares of commercial land in Tan An City, Long An to Aeon Vietnam.
At present, Idico is planning and has submitted full documents to transfer the listing of Idico shares from the Ha Noi Stock Exchange (HNX) to the Ho Chi Minh Stock Exchange (HOSE), and will follow closely to accelerate this plan.