Vietnamese investors rush to pour money into power projects

Vietnamese investors rush to pour money into power projects

At present, the Electricity of Vietnam (EVN), its subsidiaries and
state-owned enterprises make up more than 70 percent of total electricity
output. However, the proportion will change in the future as the number of
privately run power plants has been increasing rapidly, and ie expected to
put out 46 percent of total output in 2016-2020.

The Vietnam Rubber Group (VRG) has announced it is looking for investors to
buy its 111 million shares in five hydropower companies. The starting
selling price is VND1.414 trillion.

Two of three shortlisted investors are the well-known names in the market.
These include Gia Lai Power JSC belonging to Thanh Thanh Cong Group (TTC)
owned by
Dang Van Thanh, a well-known banker and businessman, and REE, which is among
the 30 listed companies with the highest capitalization value.

Both TTC and REE have experience in the power sector. TTC, known as a sugar
producer, besides 19 hydropower plants, also runs seven thermopower plants
with the total capacity of 350 MW, which use bagasse.

REE now owns hydropower and thermopower plants with total capacity of 593
MW.

In an interview with Doanh Nhan Sai Gon last year, REEs president Nguyen Thi
Mai Thanh said power projects are projects REE is interested in. Since the
Vietnam economy has been growing well, the demand for water and electricity
is always high.

The enterprises 2015 financial report showed that REE holds 60 percent of
stake in Thac Ba Hydropower JSC which runs the 120 MW hydropower plant, one
of the 40 largest plants in Vietnam.

REE also invests in Thac Mo (150 MW), Srok Phu Mieng (51 MW), Song Ba Ha
Hydropower Plant (220 MW), Pha Lai Thermopower Plant (1,040 MW) and Quang
Ninh Thermopower Plant (1,200 MW).

By the end of 2015, REE had invested VND3.509 trillion in electricity
projects, accounting for 71 percent of its investment portfolio.

Many other private investors have jumped on the bandwagon. These include
Bitexco , Hung Loc Phat and Hoang Anh Gia Lai, the real estate developers,
Hung Hai Group, which owns 20 hydropower plants with the total capacity of
550 MW, and Trung Nam Group which develops a VND3.965 trillion wind power
plant in Ninh Thuan province and hydropower projects in other provinces.

Nguyen Du Luc, president of Hung Loc Phat, said power projects can bring
stable profit if investors can manage well and build plants with high
capacity of 150 MW and higher.

Hung Loc Phat said it was considering buying two hydropower plants in Laos
from Hoang Anh Gia Lai, which may sell the plants because of financial
problems.

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Ref:
http://www.energycentral.com/news/vietnamese-investors-rush-pour-money-power
-projects?did=39204294&utm_source=2016_10_12&utm_medium=eNL&utm_content=7196
5&utm_campaign=DAILY_NEWS

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com