XDC once increased in price to 1 million VND/share, now 'evaporated' 780,000 VND

Construction stocks once skyrocketed 55 times in price in 2 months.

Tan Cang Construction Joint Stock Company (UPCoM Code: XDC) once caused a stir in the Vietnamese stock market when it continuously had shocking price increases.

In the first month of May 2023, XDC shares were only trading at around VND 18,000/share. However, by the trading session on June 26, 2023, XDC code had skyrocketed to VND 999,900/share. This means that this code has increased in price 55 times in just 2 months.

Construction company shares increased in price to 1 million dong, this stock lost 780,000 dong image 1 — Tan Cang Construction (XDC) shares once reached 1 million VND/share, now have reversed to a shocking decrease. (Photo TL)

In the following trading sessions, XDC shares were not traded or were traded in very small quantities. The stock price also gradually decreased. At the trading session on November 14, 2023, XDC was priced at VND 221,100/share and there had been no transactions for many sessions. Thus, after reaching a peak of VND 999,900/share, XDC turned around and fell sharply by 78% after 5 months.

XDC's shocking price increase series reminds investors of the most expensive stock on the Vietnamese stock exchange - VNG Corporation (Code VNZ). However, it is worth noting that the number of shares traded per session of XDC is only a few hundred to less than 2,000 shares, many sessions even have no transactions. Most notably, from June 30 to August 9, XDC code had no transactions. By August 10, 2023, XDC's price dropped shockingly to only 600,000 VND/share with liquidity of only 100 units.

In July, the Hanoi Stock Exchange (HNX) also put XDC on warning status for not holding the 2023 annual general meeting of shareholders as prescribed by the Enterprise Law.

Business has been going backwards for 4 years, but stock prices are still skyrocketing.

Tan Cang Construction's main business areas are construction, repair of water works, dredging of rivers, seaports and leasing of shore cranes. XDC started listing on the stock exchange in October 2022 with 3.28 million shares offered for sale, equivalent to 36% of charter capital. At the time of offering, only 3 investors registered to buy 8,200 shares at an average price of VND 15,502/share.

Regarding business performance, in the past 4 years, XDC has continuously recorded declines in both revenue and profit. Specifically, from 2019 to 2022, the company's revenue decreased from 523 billion to 279 billion VND.

Profit after tax also followed the trend of revenue, rapidly decreasing from 14 billion VND to just under 8 billion VND in 2022. The company's total assets also fluctuated greatly. Current assets dropped sharply from 564 billion to just over 204 billion VND in 2022. Owner's equity remained at 90 billion VND for 4 years.

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