Vietnam's Hoa Binh Construction Wins Backing for Major Financial Overhaul

Hoa Binh Construction Group (HBC) has secured shareholder approval for a comprehensive internal restructuring as the company shifts its focus from aggressive growth towards financial rehabilitation.

At an online Annual General Meeting held on June 26, investors approved all management proposals, including a three-pronged overhaul of the company's operations, debt, and human resources. The move follows a difficult 2025 for Hoa Binh, a year characterized by project delays, escalating material costs, and compressed margins throughout the construction sector.

In a strategic pivot, the board has opted to shrink its project pipeline, renegotiate supplier contracts, and divest non-core assets to strengthen its balance sheet, moving away from a strategy of pursuing revenue targets at all costs.

The group’s total assets at the end of 2025 were recorded at VND16.1 trillion ($619.23 million), a 4.48 per cent increase compared to 2024, with equity reaching VND1.96 trillion ($75.38 million). Net revenue for 2025 reached VND4.62 trillion ($177.69 million), achieving 51.34 per cent of the company's target. Management attributed this performance to both objective market challenges and the group’s deliberate prudence in project selection and risk control to support its long-term restructuring goals. For 2026, the group is targeting total revenue of VND10 trillion ($384.62 million) and a net profit of VND250 billion ($9.62 million).

A key component of the approved plan is the issuance of shares to swap for debt. The group will issue over 51 million shares to settle debts with a total value exceeding VND514 billion ($19.77 million). This measure is designed to alleviate liability pressure, improve the capital structure, and bolster long-term financial capacity. The decision by creditors to participate in the swap is seen as a vote of confidence from long-standing partners who have collaborated with Hoa Binh on hundreds of projects over many years.

Regarding the company's stock price, the Board of Directors stated its belief that the 2025 profit results do not fully reflect the firm's intrinsic value. The board anticipates that its management efforts and strategic execution, particularly its expansion into international markets, will help restore the stock price to a level more aligned with its underlying worth.

The 2026 strategy is centered on balancing growth with efficiency to enhance operational quality and build a foundation for sustainable development. Hoa Binh is focusing its resources on three core pillars: enhancing cash flow, improving profit margins, and consolidating core competencies. As part of this long-term vision, the company has established Hoa Binh Invest Holding, a strategic entity to directly manage investments in sectors such as technology, education, and finance.

Speaking at the meeting, Le Viet Hai, Chairman of the Board of Directors, said, "Hoa Binh has passed through the most difficult period without losing its core capacities and values. Gold is tested by fire, and hardship is tested by strength – Hoa Binh has undergone another trial to prove its resilience and has been tempered into an even more solid collective."

On the same day as the AGM, Hoa Binh was recognized for its environmental, social, and governance initiatives, earning a place in the Top 10 ESG Vietnam. The company views ESG not merely as a compliance standard but as a foundational value and a critical 'passport' for its international expansion.

Reflecting positive market momentum, Hoa Binh has been appointed general contractor for construction, mechanical and electrical (M&E), and fire protection systems at a mixed-use apartment project in Hanoi's Dam Lieng Area. The project is developed by Tan A Dai Thanh Development Investment JSC, which had previously selected Hoa Binh for its Galia project in Hanoi and Meypearl Harmony in Phu Quoc.

Additionally, Hoa Binh has continued to win bids for M&E and technical infrastructure packages for the Thanh Phu residential and commercial services area, the Viet Tien LB headquarters project in Hanoi, and the H55 project in Quang Ninh province. The combined value of these new packages is nearly VND1.5 trillion ($57.69 million). These contract wins in the first half of 2026 affirm the company's market reputation and general contracting capabilities as it pursues new development opportunities.