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Graduation Thematic Lecturer: Master Pham Thi Phuong Loan
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Phm Tun Anh
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Table of Contents
I. Literature review ........................................................................................................................................ 5
The financial operations and analyzing financial report. ................................................................................ 5
1. Definitions: ......................................................................................................................................... 5
2. Revenue ............................................................................................................................................. 5
3. Expenditures ...................................................................................................................................... 5
4. Profits ................................................................................................................................................. 5
5. Purposes, signification and obligation of analysis of financial statements ........................................... 7
6. Methods ............................................................................................................................................. 7
II. Documentations ...................................................................................................................................... 10
1. Balance sheet .................................................................................................................................. 10
2. Income statement ............................................................................................................................. 10
3. Cash flow statement ......................................................................................................................... 10
C. Risks ...................................................................................................................................................... 11
4. Definition .......................................................................................................................................... 11
5. Risks Classiffication ......................................................................................................................... 11
a. Can and can not calculating risks.................................................................................................. 11
b. Active and Inactive Risk. ............................................................................................................... 12
c. Fundamental risk and separately risk. ........................................................................................... 12
6. Some ways to handle risks ............................................................................................................... 12
a. Advoiding ...................................................................................................................................... 13
b. Suffering ....................................................................................................................................... 13
c. Accept risks suffered a computer failure, a speculative risk. ......................................................... 13
d. Minimize risk - Minimize losses ..................................................................................................... 14
e. Conversion ................................................................................................................................... 14
f. Risk Reduction.............................................................................................................................. 15
II. The actual situation ................................................................................................................................. 16
A. General about the Real Estate Market from 2007 to 2012 ................................................................... 16
B. General Introduction about Thoi Dai House Development and Investment joint stock Company. ......... 17
1. The process of formation and development. ..................................................................................... 17
2. Objectives and strategy of development ........................................................................................... 17
3. Organizational Structure. .................................................................................................................. 18
4. Business Activities. ........................................................................................................................... 18
5. Investment & construction activities. ................................................................................................. 19
III. Analyze companys situation ................................................................................................................ 19
A. Business Analysis ................................................................................................................................ 19
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1. SWOT analysis ................................................................................................................................ 19
a. Strengths ...................................................................................................................................... 19
b. Weakness ..................................................................................................................................... 19
c. Opportunities ................................................................................................................................ 20
d. Threat ........................................................................................................................................... 20
2. PEST analysis: ................................................................................................................................. 22
a. Political factors.............................................................................................................................. 22
b. The Economic Factors: ................................................................................................................. 22
c. Social factors ................................................................................................................................ 23
d. Technical: ..................................................................................................................................... 24
3. Revenue analysis ............................................................................................................................. 25
4. Expenditure analysis ........................................................................................................................ 26
5. Profits analysis ................................................................................................................................. 27
B. Financial Analysis ................................................................................................................................ 27
1. Dupont analysis: ............................................................................................................................... 27
2. Ratio analysis: .................................................................................................................................. 30
e. Liquidity: ....................................................................................................................................... 30
Receivables: ............................................................................................................................................... 30
Payables: .................................................................................................................................................... 31
Cash Ratio: ................................................................................................................................................. 31
Current Ratio: ............................................................................................................................................. 32
Quick Ratio: ................................................................................................................................................ 32
f. Asset Utilization: ........................................................................................................................... 33
Inventory Turnover: ..................................................................................................................................... 33
Receivable Turnover: .................................................................................................................................. 33
Payable turnover: ........................................................................................................................................ 33
Cash Conversion Cycle: ............................................................................................................................. 34
Current Asset Turnover: .............................................................................................................................. 34
Long term asset turnover: ........................................................................................................................... 34
Total asset turnover: ................................................................................................................................... 35
g. Capital and structure solvency. ..................................................................................................... 35
Times Interest Earned Ratio: ...................................................................................................................... 35
h. Financial Leverage: ...................................................................................................................... 36
i. Profitability: ................................................................................................................................... 37
Profit margin On Sales: ............................................................................................................................... 37
Return On Total Assets: .............................................................................................................................. 37
Return On Common Equity: ........................................................................................................................ 38
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3. Comparation between 4 companies: ................................................................................................ 39
j. Liquidity: ....................................................................................................................................... 39
Cash Ratio: ................................................................................................................................................. 39
Current Ratio: ............................................................................................................................................. 39
Quick Ratio: ................................................................................................................................................ 39
k. Asset utilization ............................................................................................................................. 40
Inventory Turnover: ..................................................................................................................................... 40
Receivable Turnover: .................................................................................................................................. 40
Account Payable Turnover: ......................................................................................................................... 40
Time earned interest ratio: .......................................................................................................................... 41
l. Financial Leverage: ...................................................................................................................... 41
m. Profitability: ............................................................................................................................... 42
Profit margin On Sales: ............................................................................................................................... 42
Return On Total Assets: .............................................................................................................................. 42
Return On Common Equity: ........................................................................................................................ 42
4. Financial Risks and Recommendations: ........................................................................................... 43
n. Risk: ............................................................................................................................................. 43
i. Asset Utilization: .................................................................................................................................. 43
o. Recommendations: ....................................................................................................................... 44
i. Social house: ....................................................................................................................................... 44
Finance leasing: .......................................................................................................................................... 44
Links to the bank: ........................................................................................................................................ 45
Manage accounts receivable: ..................................................................................................................... 45
Payment discounts:..................................................................................................................................... 45
C. Risks Analysis .................................................................................................................................. 45
1. From the outside .............................................................................................................................. 45
2. From the insides ............................................................................................................................... 47
3. Some specific risks and Solutions. ................................................................................................... 47

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Literature review
The financial operations and analyzing financial report.
Definitions:
Business analysis is the process of evaluating a company's economic prospects and
risks. In business analysis, financial statement analysis is an integral and important part.
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Financial analysis is the application of collecting and processing of accounting information
and other management information in order to assess the financial position of a business,
risk assessment, quality level and effectiveness of business operations. It helps the
information users to make financial or management decisions consistently.
Revenue
Gross sales of merchandise: sales revenue is the total value of products, goods and
services that the business has sold in the period.
Net sales revenue: Net sales revenue equal to gross sales revenue except ice deductions,
tax credits, this indicator reflects the value of goods sold of the business during the
reporting period.
Expenditures
Cost of goods sold: a manifestation in cash full cost of the business to complete the
production and consumption of certain types of products.
Selling expenses: including costs incurred in the process of sale of products, goods and
services, salaries and allowances payable to staff sales, marketing, product packaging,
store , depreciation and amortization, packaging, material costs, costs of purchased
external, storage costs, advertising, ..
Business management costs: are costs that spending related to the organization,
management, production operations business. Management costs include different types:
Cost management personnel, material costs, tooling depreciation. These are costs that are
fixed in nature, yet for expenses should rise against plan is unusual, need to consider the
specific cause.

Profits
Profits is the sum of net income of the enterprise after deducting all expenses. In other words
profit is the amount of revenue the difference between sales and service provider minus
deductions, cost of goods sold, operating costs, rent.

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Financial statement analysis K.R.SUBRAMANYAM &John.J.Wild McGraw Hill 2009, p.27
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Any organization has a target to look forward to, the target will be different between
organizations of different nature. The goal of the nonprofit organization's administrative work,
social, humanitarian purpose, non-business nature. The goal of enterprise in market economy is
profit comes along. All business activities revolve around profit targets, profit-oriented and all
for profit.
Profitability of business include:
Gross profit: profit earned by the company from total revenues after subtracting the deductions
as Sales rebates, returns of sales, special consumption tax, export taxes, and minus Cost goods
sold.
Net profit from business operations: net profits earned from business activities enterprises' . This
indicator reflects the results of operations of the enterprise business in the reporting period. This
indicator is calculated on the basis of gross profit revenue sales and service provider except cost
of sales and business management costs attributable to goods and services provided during the
reporting period .
Profits from financing activities: reflecting the effectiveness of financial operations of the
business. This indicator is calculated by dividing operating income minus financial costs arising
from this activity. Profits from financial operations including:
- Profit from the joint venture capital contributions.
- Profit from investing activities, buying and selling securities short and long term.
- Profit on property rental.
- Profit on entrepreneurial activities.
- Rate differentials profits from bank deposits and bank loan interest.
- Profit from loans.
- Profit from foreign currency sale.
Other profit: is the business profits unintended or premeditated but less likely to occur. But
other profits may be caused by subjective unit or by objective to.
The irregular incomes of the business including:
+ Collection of sale or liquidation of fixed assets..
+ Fine collection breach of contract.
+ Income from bad debts has been treated, cleared up.
+ Debts that not be identified.
+ Business earnings of previous years were omitted or oblivion of accounting entries this year
discovered.

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Purposes, signification and obligation of analysis of financial statements
The executing of financial analysis regularly will provide information to users, to identify
and timely judgments to make the right decisions, as appropriate. Demand for information
from financial analysis derived from multiple objects: Creditors, Equity investors,
Managers, Technical analysis, Fundamental analysis, Customers,.
o The goal of administrators and business owners is profit. They must maintain the
operation of the business and ensure its solvency.
o Lenders are interested in money, taking into account liquidity and equity of the
company, to ensure the safety of their loans.
o The payback period, return on equity is of concern to investors, so they need
information about financial viability, effectiveness and potential of the company.
Obligations of financial statement analysis is to evaluate the financial position, business
performance, effective use of corporate funds through specific data, thereby making
appropriate policies to solve problems &capacity, in order to maximize the profit.
Methods
The strategic management tool, Strengths-Weaknesses-Opportunities-Threats, or SWOT
analysis, is useful for planners in developing strengths to take advantage of opportunities,
realizing the threatening weaknesses to proposed overcoming measures.
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Helms, M. M., & Nixon, J. (2010). Exploring SWOT analysis - where are we now? Journal of Strategy and Management, 3(3),
215-251. doi:http://dx.doi.org/10.1108/17554251011064837
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Porters five major forces shaping all industries and structures are: the bargaining power of
buyers, the bargaining power of suppliers, competitive rivalry in the industry, threats of new
entrants and threats of substitutes (Porter, 1 979). The purpose of developing a model of
environmental threats is to aid managers in evaluating these threats so they can become
more successful in creating strategies to neutralize them
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The DuPont Model of Business is almost 100 years old. It provides a classic
template for the decomposition process that can be used to build integrated systems of
performance metrics 4. This is a powerful financial analysis tool allowing analysts may be
full overview of the basics of business to make the right decision. Dupont model ratios are
simple to compute, easy to interpret, and likely to be around for a long time.
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3
Rice, J. F. (2010). ADAPTATION OF PORTER'S FIVE FORCES MODEL TO RISK MANAGEMENT. Defense AR
Journal, 17(3), 375-388. Retrieved from http://search.proquest.com/docview/722692551?accountid=39958
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Mitchell, T., Mitchell, S., & Cai, C. (2013). Using the DuPont decomposing process to create A marketing model. Journal of
Business & Economics Research (Online), 11(11), 485. Retrieved from
http://search.proquest.com/docview/1458944503?accountid=39958
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Mangiero, S. M. (2004). WHY THE DUPONT MODEL IS IMPORTANT. Valuation Strategies, 7(3), 24-31. Retrieved from
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Pest analysis supplies us the factors that are important to the specific industry sector and
companies operating in that sector. PEST is an acronym for political, economic, social and
technological analysis".
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o Political factors include government policies relating to the industry, tax policies,
laws and regulations, trade restrictions etc.
o The economic factors relate to changes in the wider economy such as economic
growth, interest rates, exchange rates and inflation rate, etc.
o Social factors often look at the cultural aspects and include health consciousness,
population growth rate, age distribution, changes in tastes and buying patterns, etc.
o The technological factors relate to the application of new inventions and ideas such
as R&D activity, automation, technology incentives and the rate of technological
change.
Conceptual framework

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Research and markets; PEST ANALYSIS - renewable energy sector in canada. (2010). Energy Weekly News, , 418. Retrieved from

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II. Documentations
1. Balance sheet
A balance sheet is one of two accounting reports that every company produces on a regular
basis. It provides a snapshot of the company's finances at a given point in time and is based
on the simple fact that net worth equals what is owned-assets-minus what is owed others-
liabilities. The balance sheet must follow the following relationship:
Assets = Liabilities + Shareholders' Equity
Income statement
The income statement shows the balance between revenue and expense, its reflect the
overall situation and the results of business operations in specific period. Its divided into
two parts: the operating and non-operating sections.
Cash flow statement
Cash flow statement represents inflows and outflows cash of an organization in a certain
period of time. This report is a tool that helps organizations manage the cash flow of the
organization. The report cash flow typically include:
Inflows cash:
The customer payments
Interest from deposits
Returns on investment
Investment of Shareholders
Outflows cash:
Payment for the purchase of stock, raw materials, fuels, goods, tools
Accrued salaries, rent and other operating expenses
Payment for the purchase of fixed assets, machinery, office
equipment, ....
Paying return
Payment of tax

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C. Risks
In daily life and daily production, like it or not, at one time or another, and despite scientific
and technical progress to where to go anymore, people still suffer losses - the
consequences of risk , in the impact of the risk taken to. Risk of loss arises many, if not so
much to make the word "risk", "risk", "loss" ... has become common in everyday language.
However, not so that anyone can understand, and can use the "from" and "term" which
correctly without confusing them with each other.
Definition
As in the beginning mentioned, the word "risk" is often used in daily speech, but few people
sit down to find a definition for it. Especially, with few people (economists, who study the
insurance ...), the definition of the word "risk" is putting out a lot, in many different angles
even very different. Maybe record some definitions as follows:
According to Knight Frank: "Risk is a measure of uncertainty can be"
According to Irving preffer: "Risk is a combination of the randomness can be measured by
probabilities"
According to Allan Willett: "Risk is uncertainty regarding the specific event occurs not
expect" & "Risk is definitely not a malfunction occurs or happens time and date uncertain.
To combat this, it may require insurance "
The above definition though somewhat different, but both refer to the same two problems: -
The uncertainty, uncertainty; - A bad possibilities: an unexpected event, losses.
Risks Classiffication
a. Can and can not calculating risks
People try to clearly define and separate from two types of risk: calculated and can not be
calculated.
The risk can be calculated or financial risk: is the risk that the frequency of occurrence and
the severity of it can be predicted.
Risk can not be calculated or non-financial risks: people can not (or can not) find the rules
so athletes can not (can not) predict the probability of occurrence of future events .
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In fact, it seems that there is no clear boundary for the above two types of risk because they
can even determine the probability of the event occurring in the future, that number is only
correct level relative to a certain level of reliability.
b. Active and Inactive Risk.
It is also classified into two types of risk: active and inactive risk.
Active risks: the risks both can lead to impaired both can lead to an ability to make a profit.
Also the ability to make a profit because it is also known that this risk is the risk of thinking
or a speculative risk.
Inactive Risk: the risk is only likely to lead to losses or losses not likely to make a profit.
Because it is always and only associated with a bad ability, impaired should we call pure
risk (or risk net). Static risk incurred losses can occur for all three subjects: - assets; - Man;
- Responsibility.
Similar calculations of risk and may not be calculated, it is difficult to clear boundaries
between active and inactive risk. However, it was pointed out three basic differences
between them are as follows: - Inactive risk often associated with physical damage, and
risks related to changes in price, value, - Active risks still exist but for the overall
development affecting only a few elements, in contrast, when launched risks will affect all
elements of that overall; - terms of time time, inactive risk is more common then active
risks.
c. Fundamental risk and separately risk.
Fundamental risk: the risk that comes from the mutual impact of economic, political, social
and sometimes purely materialistic. The consequent loss due to fundamental risks caused by
not only the individual and affect the entire group of people in society. Distinct risks: risks
that stem from individual human beings. The impact of these risks not greatly affect the
entire society that only affects a few people.
Some ways to handle risks
Risk is uncertainty, uncertainty about losses. Risk exists everywhere, all fields associated
with active social life. Will no one can be completely freed from the risk, therefore, in one
way or another, positive or negative, they are confronted with a number of specific risks
do.Cho far, economists, scholars insurance, along with the understanding of the risks, and
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has launched several manners for risk, and the risk of loss. Some treatments may include
the following :
a. Advoiding
This behavior is most evident because of course would better if they avoid as much risk and
loss. According to the researchers, the main risk is to avoid the implementation of good
choices, taking decisions adaptation in daily life. For example: After 11.9.2001 events in
the U.S., some people not to travel to terror risk aversion. Some people want to avoid the
risk of respiratory infections due to contaminated environments industrial fumes may be in
rural areas or in sloping song.Tren fact, can only avoid the financial risks can have a choice
and that the acceptance of this risk, avoid other risks are reasonable. In terms of a market
economy, the rational (or irrational) avoidance method is determined by the cost of that
choice in comparison with the cost of other options. For example: One can not avoid the
risk of fire by selling home and ... wandering in the streets, can not answer questions
someday will die by suicide can not be applied immediately khac.Khi avoidance method, it
is forced to find other ways to solve.
b. Suffering
This may seem like an easy way of handling the most to embrace uncertainty about a
certain event. However, not quite that simple because there are many reasons for people to
accept the risks incurred: a. The decision to bear the risk when there is no better method to
solve. Like the example above, we are required to reside in the immediate risks incurred
accept house could be on fire at some point. We accept to bear the risk of fire, explosion,
fall means moving from one place to another, can not avoid it by walking Haye .. wonder
lamp Alladin.b use. Risks suffer by people can not comprehend that risk. Some people
avoid the risk of respiratory illness to live in the hills, there can always be a victim of a
landslide caused by collapsing houses he accidentally take on complex geological regions,
wrong dinh.c. Risks suffer by inertia, passivity became customary practices (habits not only
of an individual but of a group of people in society). A person must be aware of insurance
to deal with the risks themselves but he was not going to buy auto insurance if employee
insurance operators not to take the offer. This is by far still popular in Vietnam.
c. Accept risks suffered a computer failure, a speculative risk.
It is easy to find in this business field. High level of risk, can yield profits greater. A truck
owners, risk tolerance infractions penalized, deliberately overloaded cargo to be higher food
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words. A stuntman stunt accept the role of the "stunts" to receive generous salary, here
accept to bear the risk that a decision will be considered, after contemplating judge fairly
accurately the risks certain risks. And the level of risk is the basis for evaluating a particular
business venture or just know desperate than not, not poorly produced business, the risks
incurred as the one that led to the incident create a fund to make up for the loss. This mode
is also called "self-insured Although small scale can (large losses can occur while the fund
has not accumulated much) but it is also very important, at least, it demonstrates the ability
of an administrator, an entrepreneur.
d. Minimize risk - Minimize losses
The risk that a condition to increase impaired. No risk still exists, risk, ability to launch
higher risk. Therefore, to minimize the risk can only reduce the probability of the event not
reduce the level of risk or eliminate risks. Today, science and technology development for
human help a lot in reducing risk. For example, electronic detectors capable of detecting
cracks in deep shaft to avoid the risk of disruption to the system occurs while operating
machinery, automatic circuit breaker when there is a hit circuit ... A generalization, to
minimize the risk factor is eliminated existence can increase the likelihood of loss, making
stable and nearly risk probability was judged before hon.Khi risk was launched, the object
has been damaged, this measure is to minimize time losses to a minimum. Fire extinguisher,
shovel, sand is fully rational layout of the plant not prevent the onset of fire, but useful for
quickly extinguished the fire, avoiding the spread. Road Rescue Cu butt does not make the
car off to avoid risks to win, but when problems occur, it significantly reduces the number of
injuries vong.Giam least minimize losses and risk are two measures closely related to each
other. The periodic health examination not only kill disease detection and timely treatment
for sufferers. But the periodic health examination that can serve as a reminder to everyone
complies with the principle of prevention leads to some sufferers will be less so.

e. Conversion
Risk can not be avoided, but if you accept to bear the entire risk ... it would be too risky. In
this case, we seek to move a part, there all the time to other people. Some form of conversion
risks may include the following:
Retrograde: As participation in two opposite direction of the same and so the risk is disabled
.. In this case the rise and decline of risk is transferred from producers to buyers of goods , to
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the subcontracts (in whole or in part). Main contractor to build a winning buildings may
subcontract all or some of the parts (electricity, water ...). Now, a part of risk will move from
the main contractor to the subcontractor.
Insurance: Insurance Technology will enable us to gather a large number of people, there will
only be a handful of people at risk and lost. They will be the insurance compensation and the
amount of compensation that is derived from the insurance fund by the same crowd
participation and contribution in the form of insurance premiums. In this way, the risk may
be incurred both communities in other words it is converting small portions through each
khac.Nhu Thus, insurance is a form of conversion risk, but need to see that's the way it
swapped its treatment is thoroughly than before. Since that conversion of insurance risk is
swapped for the majority of people are not enough to each risk impact severely affected,
while in the form of conversion of other risks, the conversion only solve benefit of a local,
risks still continue to threaten the interests of others and the interests of the social economy.
f. Risk Reduction
All of the above methods, in addition to insurance, do not do this. Insurance is therefore not
only a method of conversion risk but also a risk mitigation method. Indeed, by focusing the
majority, digital statistic insurance can accurately calculate the relative ability of future
losses. The higher level of precision, reducing the level of uncertainty as well as to lower
your risk theo.Tuy course, should be stressed that not all risks are insurable. And among
these risks can be insured, the insurer guarantees to select risk is also dependent on the ability
and professional stature of the company minh.Nhu so, risks always exist and survive in many
different forms. Depending on the characteristics of each type of risk that people may have
separate processing way. Good judgment, wrong, or not fully, or not properly handle depends
on the ability of each person, each holder of socio-economic. Once the identity of human
conduct and a way to handle risks voluntarily, consciously, at that time, a new function - the
function of risk management - born.

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The actual situation
A. General about the Real Estate Market from 2007 to 2012
From 1/1/2007,Business Law of Real Estate take effects, with the introduction of business
of real estate policies such as real estate Registration Law, Tax Law, Land Use Tax,
Housing Law helps investors more confident to participate in market.
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In late 2007 and early 2008, the housing market crashed in price boom, housing prices rise
continuously. The boom in 2008 ended because of the monetary tightening policy and the
supply from banks was cut off. After 6 months of continuous decline, by 2008 the housing
market has lost 50% of the average value for the peak numbers.

By 2009, a new age of the Real Estate market opened again, appearing as light booming in
the second half of 2009, signaling the recovery and created expectations for investors.
Market has changed positively.

By 2010, the policy of the government in an effort to curb inflation in 2011 has made the
market more difficult. Due to rely heavily on loans from the easy credit growth, the
difficulty of forcing banks to tighten credit growth in the real estate industry, it also began
struggling to find loans.

2012-2013: High bad debt ratio, which is most of real estate
Because the characteristics of the real estate industry in Vietnam is only focused on the
premium segment and forget to affordable normal segment, it has caused inventories in the
premium segment increased as the economy and the purchasing power reduced. Meanwhile,
the central bank also said it would release 30,000 billion loan cheap interest rate of 6% in
order to support for low-income people, public officials and employees to purchase social
housing.
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2013, is projected to be in low-cost housing boom when investors and companies
Real Estate segment focuses fully exploit this fertile but neglected for so long, home buyers
can also selection the house suitable with his earnings.

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http://vietbao.vn/Kinh-te/Tu-ngay-112007-Luat-bat-dong-san-se-co-hieu-luc/65057438/87/
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http://kinhdoanh.vnexpress.net/tin-tuc/bat-dong-san/them-2-du-an-nha-o-duoc-vay-goi-30-000-ty-dong-2932172.html
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B. General Introduction about Thoi Dai House Development and Investment
joint stock Company.
1. The process of formation and development.
Thoi Dai company was founded on 13/12/2005 with an initial chartered capital of VND 30
billion. The principal activity of the company is to build different types of housing.

In 2009, catching the opportunities, the Company has increased its charter capital to
VND150 billion to meet the evolving needs of the Company as well as the implementation
of the Project.

With over eight years of operation, the company has gradually affirmed its brand in the field
of construction of tall buildings. Some typical projects under construction companies such
as luxury residential area of Thoi Dai (Nha Be, Ho Chi Minh City), luxury apartment coastal
resort Furama Resort Ho Coc (Xuyen Moc District, Ba Ria Vung Tau) , Phu My
resettlement area (District 7 Ho Chi Minh City), ...

Objectives and strategy of development
The target which company is striving to:
o Building the strong Brand.
o Being professional supplier of products, perfect service to customers.
o Being a perfect member for the development and building social communities.

The development strategy to diversify and improve the quality of products and services
based on customer requirements, the company has developed a comprehensive management
system, efficient and professional in addition to using and training of human resources to
ensure the development of sustainable and company always effective, and development
through the expansion of the scope of activities, collaborative alliances with strategic
partners.

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Organizational Structure.

Business Activities.
The primary business activities of Thoi Dai House Development and Investment joint stock
Company are investing in business and construction of high-rise buildings.
The company has been known as a professional unit in the field of investment and
construction of buildings. Right from its inception, the company has continuously developed
strong investment aims to bring the highest benefit to customers.
In addition, the company also conducted a financial investment by investing in real estate
companies have strong financial position, business performance satisfactory.

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Investment & construction activities.
With over eight years of operation, the company has gradually affirmed its brand in the field
of investment, construction of tall buildings. Some typical projects are performing
companies: Apartment Sesort Furama Resort Ho Coc coast, Phu My resettlement area, high-
end residential area of Times, ....
Analyze companys situation
A. Business Analysis
1. SWOT analysis
a. Strengths
Thoi Dai Company has strong position in the field of construction, real estate, machinery
and equipment served for building with the amount of equity reached 150 billion.
Company has modern technology (Top-down: basement construction, Floor technology
Bubble Deck, ..) to ensure the construction process, high competitiveness. Construction
works have been certified with high quality assurance.
The company headquarters is located in Nha Be District, which near the administrative area
of the city, has always received help attention and direction of the Department of
Construction and agencies of central and local authorities in the process of building and
development.
The company has a team of dedicated leaders whhich have qualified, experienced in
management. Staff corporations in recent years have been continuously strengthen and
improve both quantity and quality, ensure adequate expertise, project management skills.
b. Weakness
The company has large liabilities. In addition, while being the contractor during
construction and installation performed, the Company is also regularly occupied the capital,
the huge accounts receivable.
Revenue and profit are not stable. During project implementation, revenue is lower and
increased only when the project completed, go to work or be sold.
The company is currently a lack of high quality human resources to meet the needs of
developing and implementing business strategies for the coming years.
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Lack of staff with expertise in the management and supervision of works, dedicated team
looked at the situation and plan the strategy for the company.
Marketing activities are weak. Currently, the company has not yet fully developed
marketing activities to increase competitiveness in the market.
c. Opportunities
After equitization, the equity of the Company will increase, getting large amounts of capital
from outside investors. Large equity will help the company to implement large projects in
the present and future. The involvement of external stakeholders helps enhancing the
transparency and independence of the Corporation, thereby higher the operational efficiency
of enterprises.
Growth of Vietnam's economy in coming years expected at high speeds led to urbanization,
opens up great opportunities for the construction industry and real estate business.
Lower prices of construction materials would be favorable for investment.
The government's plan for a number of larger cities will make urbanization continues to
expand.
Home prices have fallen 20% - 30%, a number of projects decreased to 50% compared to
2011 when open sales. Declining real estate inventory, as of May 10/2013 dropped by
nearly 25% compared to the quarter I/2013. The real estate market in 2013 and has traded
back.
9

d. Threat
The real estate market is recovering but still slow. This is a great influence to the project's
real estate business corporation, especially when these projects play a large role in the
business activities of the Corporation during the period of 05 years.
Fierce competition from other businesses in the construction and real estate.

The loan conditions imposed tighter financial constraints for construction companies and
real estate business. Both policy of the Government and from banks, credit tightening real

9
http://vtv.vn/Kinh-te/Bat-dong-san-Viet-Nam-se-hoi-phuc-dan-trong-nam-2014/105054.vtv
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estate is certain. New Report of Vietnam Report shows 60% of banks participating in the
survey that will further tighten procedures and processes for real estate loans.
10

10
http://vef.vn/2011-03-23-60-ngan-hang-se-that-chat-cho-vay-bds
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PEST analysis:
a. Political factors
Revised Land Law with many new features in land acquisition, land valuation, land use
planning is adopted. The Ministry of Finance also allows people to self-determination of the
personal income tax when the property transfer ... has contributed to the new dynamics for
real estate.

Social Housing Policy is quite popular in the world. This policy is supported by the State,
providing secure housing with affordable rates but is the social component in low and
middle income. Throughout the world, many countries have adopted this policy.

30,000 billion support package will create the conditions for people to access markets and at
the same time forcing investors to change strategy in the design and construction.

Homeownership Law for foreigners will have strong appeal of foreign investment capital
into the real estate market of Vietnam.

Government committed to support equality in policy between domestic enterprises and
foreign enterprises will increase the competitiveness of Vietnam compared to neighboring
countries. In 2014, opportunities for foreign investors in Vietnam expanding real estate
market and can expect a good progression.

In 5/2012, the Government issued Resolution No. 13/NQ-CP with policies that are directly
related to the real estate market is a 50% reduction of land rent payable.
11

Expectations from VAMC debt trading activities: End of 2013, VAMC has actively
implemented the purchase of bad loans at banks. It is known that in 2014, VAMC will begin
deploying handling bad debt purchased, including sale of NPL consideration. There are
many foreign organizations are looking to buy back bad loans from VAMC.
b. The Economic Factors:

11

http://www.chinhphu.vn/portal/page/portal/chinhphu/hethongvanban?class_id=509&mode=detail&document_id=158875
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Japan and South Korea have tended to invest heavily in Vietnam. since the beginning of
2011 the number of new and additional grant funds is $ 4 billion. Japan is also the largest
ODA provider for Vietnam (over 30%).

The process of restructuring (merger) banks will greatly impact the real estate investors,
especially businesses depend on banks. The difficulties of the global financial markets
continue to put pressure on the profitability of all segments of the real estate market.
Accordingly, the investment is still flowing into the emerging markets of Asia countries.

Vietnam has favorable position to maximize the competitive advantage in the market of
areas, it is one of the urbanization rate is the lowest in the country with a housing density
highest. This is a good sign for future housing development.

Funds from bank accounts for approximately 70% of the money flowing into the property
market. So tightening or loosening monetary policy will affect survival in this industry.
VN deposit rate has dropped sharply in 2012 from 12% to 8%, this is a positive move
from the government to loosen monetary policy to support the development of real estate
market.

The first six months of 2012, the unemployment rate of workers age was 2.29%, of which
3.62% was urban and rural areas was 1.65%. Compared to the same period of 2011, the
general unemployment rate was 2.58%, urban unemployment was 3.96% and 2.02% in rural
areas, the unemployment rate in the first six months of 2012 was relatively low , especially
in the context of the economic crisis continues to impact on the economy of Vietnam.
12

c. Social factors
Population: 68% of 89 million people in Vietnam are under the age 40. Vietnam population
is forecasted to increase by 16 million people from 2000 to 2020. Housing demand will
increase sharply in the period 2010-2020.
13

Vietnam real estate industry is just focused on the premium segment and forget to
affordable housing segment , it has caused inventories in the premium segment increased as
the economy and declining purchasing power. Meanwhile, the people who has real demand

12
http://www.vietnamplus.vn/6-thang-dau-nam-ty-le-that-nghiep-ca-nuoc-la-229/150759.vnp
13
http://vfpress.vn/threads/tong-quan-thi-truong-bat-dong-san-tu-2011-den-nay.41906/
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for housing cannot buy the house because of the amount of affordable housing on the
market is limited.

The value and interests of the property associated with each specific location: the location
factor is not only determined by the geographical criterion measure but also assessed
primarily by the distance to the central center, the point of public services, public works,
such as trade, culture, health, education and dependent on access...

Demand for real estate in every region, every country, every ethnic strongly influenced by
elements habits, tastes and social psychology, even while including elements of belief,
religious, spiritual of nearby residential.
d. Technical:
Specifically, for the National Road System, from now to 2020 will put into operation about
2.400km, 407 bridge replacement construction on the main highway, total demand for
capital needs about 316.400 billion. Currently the Ministry of Transport has prepared 107
investment projects to upgrade and renovate a number of highways, building a bridge
replacement at a cost of about 163 833 billion. Particularly with National Highway 1,
between now and 2016 completed 4-lane expansion up to 1.050km from Hanoi to Can Tho
with a budget of 91,000 billion, divided into 18 BOT projects. For highway system, to be
completed around 2020 on the 1.900km, which has so far completed 150km. Have
identified funding sources for 452km with 117,138 billion.
14

"The National Urban Development 2012-2020 period " has identified the viewpoints is to
develop a national urban system to ensure conformity with the strategy of economic
development - social background towards green economy , motivating restructuring the
local economy , and the country during the period of industrialization and modernization ;
Urban Development to meet the requirements of sustainable , efficient use of natural
resources to support the development of regional mountainous and coastal areas , islands ,
distribution of responsibilities and coordination mechanisms between the urban spread and
exert enhance competitiveness , associated with effective urban management levels.

14
http://cpv.org.vn/cpv/Modules/News/NewsDetail.aspx?co_id=30489&cn_id=522913
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It also set a target for the period 2015 urbanization rate reached 38 % nationwide ; urban
system includes two special urban , 195 urban from type I to type IV and 640 in urban t ype
of V. ..

The goal in 2020 is the urbanization rate reached 45 % nationwide ; urban system includes
two types of special urban , 312 urban type I to type IV and type V 620 Urban Urban
Quality follow the standard steps and strategies to meet the requirements of development
and international integration.

Real estate often has great value, includes many categories so managing them quite
complex, therefore, it requires the manager to have high capacity and, cost of management
also must be higher than the row normal good. Specialy, the issuing of investment in the
construction of the building is quite complex, business problems or lease land, buildings,
houses, offices ... also requires specific research and management costs are also very high.

Real estate isnt sold on the market like other commodities, the purchase and sale of real
estate does not have enough opportunities and information to choose the right market for
real estate transactions needs. Therefore, when making transactions on the real estate
market, there should be a consultant, broker, which is the basic training, business
knowledge, legal knowledge, more experience experiment. With their participation, real
estate transactions will become easier.

Currently our country does not have a unified legal system, and the management of the real
estate market. The management and use of land is regulated by the Law on Land (1993,
1998, 2001.2003); housing management is regulated by the Law on Construction 2003,
Housing Act 2005, the Law on Real Estate Business 2006 land relations, housing in civil
transactions are regulated by the Civil Code. It still makes the real estate transactions more
difficult.
Revenue analysis
Revenue is an important financial element because it reflects the scale of the business
process. Revenue is also an important source unit to defray expenses incurred in the
course of business and to facilitate the process of re-investment, so the realization of
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revenue targets influential great financial situation, here is one of the indicators determine
the success or failure of the unit. Position to revenue expenditure review the balance going
into the analysis of the fluctuations of revenue over time.
The situation of companys revenue is shown in the following table:

It is seen from the table above, the company's total revenues stabilize in second in 2010
and 2012 on 100 billion. Meanwhile, total revenue in 2011 surged to more than 300 billion.
specific:
Sales of goods and rendering of services in 2011 increased over 2010 dollars VN
175,034,802,463, equivalent to 152%. Revenue sales and service provider company has
been operating business houses, purchase of machinery and equipment in service for site
construction, building material, interior decoration. 2011 is the year many customers the
company payment shield simultaneously increasing revenue. Therefore, by 2012, this item
was back stable reduction VN 171,441,845,439, equivalent to 145%.
Revenue from financial operations of the company rose sharply VN 1,078,559,489 to
3,579,363,712 in 2010 to 3,965,826,700 VN VN 2011 and 2012. 1 the company spent
large funds to invest in the financial sector, helps support the the process of construction
contracting, project investment and diversify payment method for customers.
Expenditure analysis
Cost is one of the factors that directly affected the profitability of the company. Doing an
increase, decrease in costs will lead to the increase or decrease of the profit. Therefore,
we need to consider the implementation costs to be so careful to limit the increase and
may reduce the costs to a minimum. This means that increase profits, improve efficiency of
company operations.

The above table we can see, the total cost in 2011 increased, consistent with increased
revenues, as discussed above. In particular:
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Cost of good sold in 2011 increased VN 169,863,268,425, equivalent to 157%; 2012
discount 169,006,577,513, equivalent to 61% compared with 2011.
Financial expenses increased to 427% in 2011, up to 9,131,266,698 VN shows that
companies need to consider an investment or finance, this will greatly affect profitability -
was analyzed in the following.
Business and administration expenses increased from approximately 3.5 billion in 2010 to
more VN 6 billion in 2011 and 2012. Particularly in 2012, the company's revenue stable
level but management costs still remain high . Companies need to review the management
of more appropriate.
Profits analysis
Profit is a general indicator to assess the effectiveness of business operations of the
company. Margins can be tangible, such as money or property, and intangible ... as the
reputation of the company with customers and market percent gain company. Analysis of
general situation profit fluctuations review of the entire company, interim vs., purport to
outline the situation but profits and causes initial affecting the image above.

The above table let us found:
Net profit from business activities of the company in a loss of 23,120,877 in 2011. This is
due to: the company's gross profit in 2011 reached 11,981,980,723 VN - at a high level.
However FINANCING ACTIVITIES losses to more than 6 billion, plus the cost of
business management in the well above 6 billion, making loss-making enterprises. In 2012,
the business situation improves significantly, financial activities less profitable, along with
a large collection of gross profit from the sale of goods and rendering of services to help
companies with high profit.
On the other hand, the profit after corporate income tax completely opposite. This was due
to other income of large companies in 2011, to 7,595,802,996 VN, helping post-tax profit
grow to over 6 billion. In addition, other income of the company in 2012 was 2,427,349,854
VN plot. Shields post-tax profit reduced to 868,161,414 VN.
B. Financial Analysis
1. Dupont analysis:
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The company's ROE reached 1.7% in 2010, fell sharply to below 0% in 2011 and increased
to 2.21% in 2012. This shows that the business situation of the company was at low level in
2011, and its was strongly revived in 2012.

On Sales Profit margin in 2011 was less than 0%, reduction from 2.28% in 2010. Though
sales in 2011 reached 289.938.755.424 VN, up to 152.33% (corresponding
175.034.802.463VND) compared with 2010, but due to administrative costs nearly doubled,
and increased 5.27 times in financing costs (from 1.732,677.796VND 2010 to
9.131.266.698VND in 2011) has made a net profit in 2011 was negative (23,120,877 VND
loss).
However, this index was positive in 2012, reached 2.94% due to profit from financial
activities (758,311,034 VN - profit) so net profit increased to 3,479,666,720 VN (2012).

In 2011, company was affected by the downturn in the stock market and tightening credit
policies of the state, making it difficult for the company, leading to losses in financial
activities.

Besides, Asset turnover ratio v Leverage ratio of companies were positive in 2011, namely
0.59 and 3.14 compared with 0.33 and 2.2 average of 2 in 2010 and 2012. The company had
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effectively utilized its assets to generate the revenue, and better use of capital owners. This
has helped losses just small (-0.00015).
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Ratio analysis:
e. Liquidity:
Receivables:

Rate of the receivables to total assets increased from 0.3% in 2008 to 43.35% in 2009,
dropped to 14.97% in 2010, then increased to 33.71% and 40, 03% in 2011 and 2012. This
is due to changes in the proportion of 3 main items: Trade accounts receivable, prepayments
to suppliers and other receivables:

Based on the table above we find: the 2008-2009 period, the company does not have any
debts from customers, so the proportion is largely from other receivables. Over the 2010-
2012 period, the customer receivables accounted a large proportion of the receivables,
particularly in 2010 (77%) and 2011 (64%). Overall the company is trying to expand the
business, attracting customers and building projects. However, the conmpany should pay
attention in trying recover debts on time, more efficient use of capital.

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Payables:

The proportion of the company's accounts payable in the period 2008-2012 were
maintained at high levels over 50%. In 2009, it reached 46.13%, and the highest was in
2008 with 74.69%. We can see, in 2008 the capital of the company was still low, so the
proportion of loans and occupied the capital of the company was high. Since 2009, the
additional capital of company was up to 150 billion VN, debt ratio was maintained at
around 50%.
Over the 3 years from 2010 to 2012, we find that the proportion of higher accounts payable
and accounts receivable, so the company should beware of loans, because if business is not
good, they can become overdue.
Cash Ratio:

The cash solvency of the the company was low, even 5 years were less than 5%. This
shows the company hold just a few cash. The 2008 and 2009, the company's activity was
mainly construction, only some possibility of payment in less than 0.5% (from 0.0287 to
2008 and from 0.0259 to 2009). Over the 2010-2012 period, the company must hold a
certain amount of cash to service the real estate business. The index was elevated, isolated
in 2011 was 6.75%, due to the amount of cash up to 22,609,686,857 VN, ensuring the
ability to cover the money for the operation of the company.

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Current Ratio:

Current Ratio of company in 2008-2012 period wass quite high and stable. Specifically,
the ratio of 5 years was all greater than 1, which means a short-term asset value of the
company is greater than the value of short-term debt. In other words, short-term assets of the
company was enough to ensure the full payment of short-term debt. Thus, the situation is
quite good for company.
Quick Ratio:

Just some quick solvency of companies in 2008-2012 were below 1 (the highest in 2010
and 2012 to .944 and 0.9). So that short-term assets can be used immediately by the
company can not guarantee short-term debt if creditors demanding money at the same time.
If the creditor does not require the same time, the company can still run normally. In
general, companies need to find customers, reduce inventory and reduce accounts
receivable, ...

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f. Asset Utilization:
Inventory Turnover:

Because the company is in the fields of real estate, the inventory turnover of companies
was very small. Specifically, in 2010 and 2012, the index was about 0.7. Particularly in
2011, despite the company in losing business, but the cause was due to poor financial
activities effectively, the company's turnover was quite high, leading to a rotation index
gained 1.78 - equivalent to 205 days, less 268 days compared with 2012 and 305 days with
2010 compared. Overall the company had not really focused on the real estate sector,
making high time inventory, leading to costs associated with inventory arising big impact on
profits. Long Inventories synonymous with the reduction of cash of company, will cause
difficulties if the debt coming due at the same time.
Receivable Turnover:

Overall, the ratio of accounts receivable turnover of the company plummeted from
2010-2012, from 6.14 in 2010 to 4.05 in 2011 and 1.82 in 2012 only. This shows the ability
of the company to recover debts fell sharply, the average collection period increased from
60 days in 2010 to 90 April 2011 and up to 200 days in 2012, the company synonymous
with capital appropriated by customers, loss the profitability from this amount.
Payable turnover:

Payable turnover ratio declined from 4.9 in 2010, 2.55 in 2011 and this ratio in 2012
was only 0.6. Average number of days from 2010 to 2012, increased to 7.1 times (74.3 days
to 602 days). This means that the level of prestige of enterprises was higher, the confidence
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of partners & suppliers in payments, working capital is an opportunity to reduce the cost of
capital, pushing strong construction activity and real estate sales.

Cash Conversion Cycle:

Cash flow is a measure used in the financial analysis of the business, in order to assess
the ability to manage the cash flow of the business. In general, from 2010 to 2012, cash flow
dropped sharply, from 71.8 days to 495.8 days, equivalent to 85.65%. Cash flow decreased
primarily due to the average number of days payable decreased.
This explains the trend shifting from construction to professional investment in real estate
business of the company. In 2010 and earlier, due to prolonged construction process,
businesses need cash to construction so the debt was high. In other words, company
managed working capital effectively, well capital rotation, ready for re-investment.

Current Asset Turnover:

The turnover of current assets of the company in 2010, 2011 and 2012 is respectively,
about 0.38, 0.75 and0.3; it means every dollar of current assets of the company was only
created 0.38 0.75 and 0.3 in revenue over three years. This suggests that the efficiency of
current assets of the company was quite low, it is necessary to reconsider the purchase of
assets useful service for business operations.
Long term asset turnover:

Long term asset Turnover of the company fell sharply from 103.56 in 2010 to 3.15 in 2012,
shows the revenue generated from the long-term assets of the company decline. This was
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because long-term assets of the company increased from VND 2,177,482,902 in 2010 to
more than 37 billion VND in 2011 and 2012. The company should consider the efficient use
of long-term assets.
Total asset turnover:

Total Asset Turnover of the company in 2010, 2011 and 2012 was respective, about
0.38, 0.71; and 0:28; it means every dollar of company assets only generate 0.38; 0, 71 and
0.28 in revenue over three years. The index difference is quite small compared to the short-
term asset turnover, because the proportion of current assets to total assets of the company
are quite high:

Thus, it can be seen in terms of asset utilization, due to activities in the two areas of
business development and real estate, so optimal efficient use of companys assets was not
good.
g. Capital and structure solvency.
Times Interest Earned Ratio:

The index time interest earned ratio of company in 2010 and 2012 was relatively good,
especially in 2010 amounted to 3.93, which means every dollar of borrowing costs, the
company had 3.93 in profit from operations production business for payment. This index
was 2.97 in 2012 - was also quite good. Particularly in 2011, due to a focus on strong
financial operations, high borrowing costs had resulted in this index decreased to 1.31.
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Activity of the company was quite risky in this year, because although the high revenues
and profits, but losses from financial activities also strongly affected.

h. Financial Leverage:

The financial leverage of the company in 2011 reached up to 4.2, higher than in 2010
and 2012 (1.34 and 1.5). Combined with Dupont model above, we find company was
strongly affected by the financial situation, which is not in professionality (construction and
real estate). The proportion of financing costs compared to profit before interest and tax
amounted to 76.2% (a total of 9,131,266,698 VN in total 11,981,980,723 VN), while the
proportion of 2010 and 2012 is only 25.44% and 33.59% . This had increased the losses in
financial activities, heavy pressure for profit after interest costs, though revenue and profits
in 2011 are quite high. The company needs to look back in 2011, improving the situation
financial performance, leverage more effectively.

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i. Profitability:
Profit margin On Sales:

Profit margon on sales ratio of company in 2010 and 2012 reached over 2%, namely
2.28% in 2010 and 2.94% in 2012. That means for every 100 VND in revenue, the company
achieved profit of VND 2.28 in 2010 and 2.94 in 2012. Particularly in 2011, for every 100
VND in revenue, the company lost 0.01 VND. As we can be seen, in 2011 the company
engaged in financial activities effectively and without damage, but then the situation had
improved and went to stable development.
Return On Total Assets:

Because in 2008 and 2009 company had losses, so ROA was negative (-0.0078 and -
0.004). In 2010-2012 period, ROA decreased from 0.8% in 2010 to -0,005% in 2011, then
up to 0.945% in 2012. This suggests that for every 100 VND invested in the property, the
company was just only getting about 1 VND in 2010 and 2012, and loss 0,005 VND in
2011. Compared to asset Turnover above is suitable. As stated above, the utilization
efficiency of company assets was still not good.

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Return On Common Equity:

The company's ROE ratio was quite low, especially negative in the years 2008, 2009, 2011
(-0.03, -0.0075, -0.00015 respectively). Particularly,this ratio in 2010 and 2012 reached
1.7% and 2.2%. That means for every 100 VND equity co-investment in the company, is
recognized in profit was 1.7 in 2010 and 2.2 in 2012 is the same. 2010-2012 Period shows
that although inefficient business of company in 2011 but it was quickly restored and
improved in 2012 with stable profits.

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Comparation between 4 companies:
j. Liquidity:
Cash Ratio:

Generally in all 3 competitors company, the amount of cash of of Companies holds are quite
low, cash ratio of Phat Dat and Hoang Quan was 0.01 and of An Khang was 0.02.
Compared to them, Thoi ai kept cash ratio of 0.04. This means the amount of money was
enough to cover even the operational business of the company, but it should be reduced to
make a profit from this idle cash.
Current Ratio:

Current ratio of Thoi Dai Company in 2012 was quite stable. Specifically, compared with
large of Companies is Hoang Quan, Thoi Dai reached 1.71 compared to 1.2 Hoang Quan,
meaning short-term assets of the of Companies to ensure full payment of short-term debt.
Thus, the situation was quite good. Separately, Phat Dat and Khang Ans index was high in
current ratio of approximately 4. 2 shows plenty of Companies on the purchasing of short-
term assets, this will affect business performance.
Quick Ratio:

Quick ratio of companies were less than 1. At the general level, Thoi Dai Company
achieved pretty good index: 0.91. Although short-term assets can be immediately used by of
Companies wasnt enough to guarantee payment if the creditor demanded the same time, but
of company's receivables were quite high, up to 40% in 2012. This means that the financial
situation of the company in 2012 was quite stable.

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k. Asset utilization
Inventory Turnover:

In case of analyzing Thoi Dai company separately, we can see the inventory management of
the company was not really effective. However, compared with three competing companies,
Thoi Dai had maintained the index in good situation. Day inventory of Times reached 473
days compared with 187 days of Hoang Quan Comp. Especially compared to the two of
Companies: Phat Dat and Khang An, inventory days of Companies was very high, meaning
that high costs and risk in liquidation.

Receivable Turnover:

Time of the debt collection of Thoi Dai Companies was fairly short when compared with 3
competitors companies. Number of collection days was 200 compared to 156 of the Hoang
Quan, 647 days and 538 days of Phat Dat and Khang An. We can see that, Thoi Dai was not
a strong Companies and have a large market share in the real estate sector, so the policy of
rapid debt collection of Companies will reduce the competitiveness.

Account Payable Turnover:

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The accounts payable turnover of Thoi Dai was pretty high, reaching 0.61 compared with
0.16 and 0.24 of the Hoang Quan and Phat Dat, the average number of days to pay the debt
reached 601 days. It shows the maturity of Thoi Dai with customers was not really long
compared to two competing companies. Consideration should be given to payments
situation, thereby increasing the index to be able to take advantage of funds from money
appropriated.
Time earned interest ratio:

Time earned interest ratio of Thoi Dai companies was strong at 2.98 compared to 1.27 of a
big companies like Hoang Quan. This means every dollar with interest expense, the
companies had 2.98 in profit from business activities to pay. This ratio can guarantee the
company's loans, thus increasing credibility with investors, banks, and customers the
opportunity to use funds from those sources.
l. Financial Leverage:

Financial leverage ratio of 3 companies: Thoi Dai, Phat Dat and An Khang were small:
1.51, 1.53 and 0.13 respectively. This means the equity is still large, financially sound
capabilities. However Thoi Dai still made use of debt leverage not effective if we compared
with Hoang Quan. We can see Quan is a big companies, so the index was pretty high, up to
4.7. With the companies of Thoi Dai, this indicator reached 2.0 will be more suitable.

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m. Profitability:
Profit margin On Sales:

Profit margin On Sales of Thoi Dai Company was good but just about a low level (3%).
This means that for every 100 in revenue, the company achieved 3 in profit. This is due to
companies operating on the 2 areas of real estate and construction. The lack of investment
focused on one companies makes the field so difficult. So, in future it can be a strongly need
to focus the resources on one particular field.
Return On Total Assets:

The net profit on the assets of Thoi Dai in general was relatively stable, compared to the
competitors. The index reached 0,009, which means for every 100 VND co-invest in assets,
the company achieved net profit of VND 0.9. Compared with Phat Dat and Hoang Quan,
Thoi Dai s ratio is consistent with the ability of the company.

Return On Common Equity:

The Return On Common Equity of Thoi Dai was pretty well, reached 0.022 compared to
0.025 of Hoang Quan. Because of capital of Thoi Dai was mainly from equity, net earnings
reached VND100 on every investment was pretty good, reaching 2.2 VND. Company
should consider the appropriate ratio between equity and capital from outside investors to
increase competitiveness, attract capital and expand market propotion.

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Financial Risks and Recommendations:
n. Risk:
i. Asset Utilization:
As a trading company of real estate, Thoi Dai company was also influenced by the stagnation of
the market.

The inventory turnover of the company fell sharply from 1.78 to 0.77 in 2012. The number
of days of inventory increased to 268 days from 205 days in 2011 to 473 days in 2012,
equivalent to 130%.

The accounts receivable turnover plummeted from 4.06 in 2011 to 1.82 in 2012.
The Average collection period increased 122%, or 110 days from 90 days in 2011 to 200
days in 2012.

LONG-
TERM
ASSETS
10%
Accounts
receivable
40%
Inventories
40%
Other assets
10%
Assets Propotion
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Current assets accounted for most of the company's total assets (60% of total assets). In
particular, accounts receivable and inventory reached high proportion of the total assets
(approximately 40%). Therefore, companys use of assets was stricken in 2012.

The general situation of the market: freezing market made many businesses to retreat,
which is accompanied by strong price cuts for capital recovery. While the apartment market
in the both North - South fell into the bleak state, 2012 was year of the social house. Cheap
apartments had heated real estate market while high-end apartment buildings were slowly
falling into frozen state. Inventory of real estate directly affected the relevant industry as
construction materials. In 2012, the real estate market fell into a slump. A series of high-end
real estate such as apartments, villas, land discounts up to 30%, even 60% but wasnt sold.
15

The project company participating in will have difficulty for the business. The situation of
the economic difficulties that the debtor's late payment, putted pressure on the liquidity of
the company.
o. Recommendations:
The government has a draft resolution about reduction of corporate income tax take from
25% to 20-23%, 50% rent reduction for slates real estate market.
16

i. Social house:
The company should move towards market share in cheap apartments because demand for
this segment will be very large, it will be the trend in the future of the market and the
economic potential of the company is not enough to compete with the growing real estate
companies. With the characteristics of construction companies and real estate business, Thoi
Dai company will have the self-control strength right in building the apartments.
Finance leasing:
Corporate loans primarily from commercial banks , which were not interested in the
property rental form. Finance leasing have many advantages like reduced load of financial
difficulty for the company, not subject to amortization costs, new technology will be
updated, ...

15
http://www.tienphong.vn/dia-oc/bat-dong-san-2012-buc-tranh-mau-xam-607398.tpo
16
http://petrotimes.vn/news/vn/bat-dong-san/chinh-sach/nha-o-thuong-mai-duoc-giam-50-thue-vat.html
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Phm Tun Anh

Links to the bank:
The company can work with the bank to sell the property in the form of installments.
Meanwhile, debt collection pressure will be alleviated for banks to ensure liquidity for the
company.
Manage accounts receivable:
The increase in accounts receivable from customers led to the expenses generated debt
management, debt collection, loan interest costs to meet the capital needs due to lack of
capital which was occupied by customers. Increasing in receivables also lead to bad debts or
debts overdue irrecoverable due to customer insolvency and capital loss. So, there should be
one reasonable credit policies to manage accounts receivable from customers and customer
analysis to determine the risk of repayment ability and credibility of our clients.
Payment discounts:
The company needs to determine payment discounts to customers when customers repay
before the deadline. The increase in the discount rate would boost the payments earlier
attract new customers to increase sales. The company needs monitoring inventory situation,
make decisions and mismanagement to recover capital and increase asset efficiency.
C. Risks Analysis
1. From the outside
a. Related to the state and the market
i. Obstacles from government
Although Vietnam has many policies to encourage investment but still exists corruption,
bureaucratic, cumbersome procedures cause significant impacts to the construction
project.
Related to the suppliers
i. Shortages of materials
Risks in the supply of materials and right type, the right to serve the design requirements
for construction.
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Phm Tun Anh
Shortages of skilled workers
Risks with the contractor to hire or train a sufficient number of qualified workers to serve
the construction.
Financial difficulties of owner
This is the risk to the investor in raising funds for the project. Investors do not pay on time
as the contractor for the contract, delay raising capital, banks disbursed later ... The impact
of the project risks are usually very heavy as do grinding halt or interrupt project until the
investor solves the difficulty in funding.
Slow payment of completed works
Delayed payment for the item has been accepted: Risk occurs because Investor delay or
non-payment to the Contractor in accordance with the payment schedule of the contract.
This risk affects the progress of the project while contractors suspended or reduced
workload execution. This is quite common in risk contractors, especially in projects funded
by the Government, the payment process usually lasts very long.
Related to the contract
i. Poor contract management
Construction contract clearly not lead to difficulties in conflict resolution of disputes.
Price fluctuations
Risk occurs when the price of materials, labor, machinery vagaries of the construction
process.
Related to compensation and clearance
i. Slow site clearance
Investors conducting clearance for all delivered to the construction company gardens are
questions about the cost of compensation and resettlement ... leads to slow.
Unforeseen site conditions
The unforeseen risks related to construction conditions at the site such as topography,
geological design / survey, the influence of the neighboring buildings.

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Phm Tun Anh
2. From the insides
a. Risks of construction organization
i. Poor site management and supervision
Risks due to the weakness in the construction organization, the management of
contractors. This is a common risk in the contractor's inexperience Vietnam. Risks due to
lack of supervision engineers and experienced management capacity of the poor.
Machinery and construction management of the project between the contractors are not
reasonable.
Obsolete or unsuitable construction methods
Risk occurs when contractors used improperly or not competently implement new
technology as required by the project. The advanced technology built into difficult
circumstances apply Vietnam: training staff, environmental construction...
Mistakes during construction
Risks related to the technical issues of the contractor during construction. This risk is very
frequent and potentially great impact on project.
The supply risk
i. Labour accident
This risk is very common. When labor accident or equipment damage. These losses are
usually covered by insurance but the project schedule affected.
Incompetent subcontractors
Risk occurs when the main contractor selected subcontractors are not qualified to perform
the work items of the project. Materials not delivered by the supplier quality (eg not enough
concrete slump, long shipping time, sand stone unsatisfactory ...)
Planning and Managing Risk
i. Inaccurate estimates
Estimating the cost and construction time is incorrect. Risks in the process of calculating
the volume, cost, construction time estimate by the Contractor for the work items.
Calculations, estimate the time and cost of incorrect stage.
Financial difficulties of contractor
This is the risk of raising capital to advance the construction contractor. The project will be
greatly affected if the contractor can not mobilize enough funds to purchase materials and
hire workers / subcontractors, machinery for the construction.
3. Some specific risks and Solutions.
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Phm Tun Anh

STT Risks Solutions
1 Excessive risk caused lun fallen, damaged
the roads, sidewalks and the surrounding;
cause litigation but, to get compensation
or stopped construction. This is the
problem with the buildings around.
Survey debacle: observed and recorded all
but prevailing conditions of buildings
around. Lun risk assessment of the roads,
sidewalks and buildings surrounding; set
limits allowed for shear parish. System
design disproportion against horizontal soil
forces against impact and limit varying
degrees of hope surrounding.
2 Difficult geological conditions of have a
thick layer of sand in depths of 10m. If the
enclosure is not deep enough relative to
the clay, groundwater can penetrate
through the same foot enclosure,
measuring fine sand layer can drift
groundwater flow and this can cause
subsidence for the area around around the
excavation process.
Solution: same length fins are designed
more, resorted to the clay and completely
cut the water flow.
If you need to drill further investigation to
determine the exact elevation of the
permeability clay layer, to lower the
elevation of the enclosure wall thickness,
permeability thoroughly.
3 During excavation of soil, water soaked in
pits will be pumped out. Drainage in
pecans may reduce groundwater levels
and subsidence caused to the surrounding
areas.
In addition to such relatively long skirt, the
Contractor shall prepare the installation of
measuring devices, pressure in key
positions around the field. The devices are
monitored regularly to ensure groundwater
levels are not alarming.
4 Water penetration through the diaphragm
wall during excavation of land. If this
happens, there will be sandy water in
lakes and executioner.
Check seriously in the construction process
relative stability of the population, quality
bentonite ...
- Control and monitoring of concrete that
process to avoid the congestion of his
concrete, ...
Experimenting with early ultrasound to
determine concrete defects.
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Phm Tun Anh
5 Lopsided pillar. Construction process control to ensure the
victory of exclusion, which prohibits buried
... before putting into use.
6 Vitiation or cut off the phone lines, water,
wastewater, ... of neighboring.
To learn the service works immersion.
Agencies contacted authorities and service
company for information.
Conduct surveys by metal, ... to determine
the position of Mr. soak, soak cap, ...
7 Environmental pollution of water sources.
Noise pollution affects the surrounding.
Continuous control, the technical evaluation
conducted research in pollution, noise, and
offers the appropriate solution.
8 During the excavation process, which the
contractor as waste, ...
Construction and bridge maintenance wheel
wash to wash vehicles before leaving the
field.
9 Causing traffic jam in the construction
process
Planning a specific time. Make navigation
traffic temporarily, if necessary, a permit
before.
10 Fire Prepare temporary fire extinguishing
system. Prepare quick contact form with fire
prevention agency.

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Graduation Thematic Lecturer: Master Pham Thi Phuong Loan

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