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Saigontourist, Benthanh Group, Hanoitourist to equitize

Released at: 17:21, 03/09/2019

Saigontourist, Benthanh Group, Hanoitourist to equitize

Photo source: titc

Three tourism giants on list of 93 State enterprises to equitize by end-2020.

by Jessica Nguyen

Prime Minister Nguyen Xuan Phuc has signed a decision approving a list of 93 State-owned enterprises (SOEs) to be equitized by the end of 2020.

Included on the list, the top three tourism corporations in Vietnam - Saigontourist Holding Company (Saigontourist), Benthanh Group, and Hanoi Tourism Corporation (Hanoitourist) - own a series of top-notch luxurious hotels and resorts nationwide.

Hanoitourist holds shares in the five most luxurious five-star hotels in Hanoi, Saigontourist owns seven five-star hotels in Ho Chi Minh City and one in northern Quang Ninh province, and Benthanh Group holds shares in 25 hotels and resorts.

According to local experts, a characteristic of Vietnam’s travel sector is high revenue but very low profit. The luxury hotel segment, however, is the complete opposite. Luxury hotels often have good occupancy rates, which brings healthy profits.

Hanoitourist

Established in 1963, the Hanoi Tourism Corporation was transformed into a limited company in 2010. It currently has some 40 affiliated member companies that are joint stock or joint venture companies.

Apart from its main business line of tourism, where affiliates include the Hanoitourist Travel Company, the Hanoi Service and Tourism Company (Hanoi Toserco), and the Hanoi Entertainment Service Company (Ho Tay Water Park), Hanoitourist also owns several offices for rent in prime locations and other commercial businesses such as Big C Thang Long supermarkets and Hanoitourist Taxi, etc.

It owns the most luxurious hotel network in Vietnam’s north, such as five five-star hotels in Hanoi, including the Sofitel Legend Metropole Hanoi, InterContinental Hanoi Westlake, Pullman Hanoi, Hilton Hanoi Opera, and Hotel De L’Opera. It also owns several four-star hotels such as Hanoi Hotel, Thang Long Opera Hotel, and Hilton Garden Inn, as well as some major hotels in the provinces of Dien Bien, Quang Binh, and Phan Thiet.

Sofitel Legend Metropole Hanoi is the oldest hotel in the capital and was built in 1901. The famous hotel has welcomed many international heads of states and was chosen as the venue for the US-North Korea Summit in early 2019. The Metropole is currently owned by the Thong Nhat - Metropole Hotel Joint Venture Company, in which Hanoitourist holds a 50 per cent stake worth VND203 billion ($8.8 million). This is also the most effective joint venture, contributing VND80 billion ($3.4 million) in profits to Hanoitourist in 2018 out of a total of VND118 billion ($5 million) in consolidated profits.

Another affiliate of Hanoitourist, Hanoi Toserco, reported profit of VND39 billion ($1.7 million) in 2018 and currently holds stakes in the Pullman Hanoi Hotel and the Hanoi Hotel.

According to a summary report of the first six months of 2019, the average room occupancy at Hanoitourist’s hotels is quite positive, with Hoa Binh Hotel reaching 65 per cent, Thang Long Opera Hotel and Thang Long Espana both 71 per cent, Sofitel Legend Metropole 72.6 per cent, and Hotel De L’Opera 84.4 per cent.

Hanoitourist recorded net revenue of VND707 billion ($30.4 million) in 2018, up 26 per cent, while consolidated after-tax profit was VND225 billion ($9.7 million), down 13 per cent. As at the end of 2018, it had total assets of VND3.7 trillion ($160 million) and charter capital of VND2.7 trillion ($116 million), while incurring accumulated losses of VND36 billion (1.6 million).

Hanoitourist has invested VND1.3 trillion ($57.3 million) in joint ventures and associates, with an annual dividend of VND120 billion ($5.2 million). The Metropole alone contributes VND70 billion to VND80 billion ($3 million to $3.45 million) a year.

Saigontourist

Another travel corporation that also owns a diversified hotel chain is the Saigontourist Holding Company. Founded in 1975, the company now manages eight travel service companies, 54 hotels, 13 resorts, and 28 restaurants. It has invested in more than 50 domestic companies and nine foreign-invested joint venture companies.

Apart from running businesses in travel and hospitality, Saigontourist has also invested in restaurants (Binh Quoi, Cung Dinh, and De Nhat), entertainment (Dam Sen Water Park and Rach Chiec Golf Course), the SCTV TV channel, and the Saigon Exhibition and Convention Center.

Saigontourist hold stakes in seven five-star hotels in Ho Chi Minh City, including the Rex Hotel, the Majestic, Grand Saigon, the Caravelle, New World, Sheraton Saigon, and Pullman Saigon Center, and one five-star hotel - the Majestic Hotel - in the northern province of Quang Ninh. It has also invested in a series of four-star hotels in Ho Chi Minh City, Vung Tau, Nghe An, Quang Binh, Ninh Thuan, Nha Trang, Quy Nhon, and Ha Long city. The company is also investing in building two other five-star hotels - one in Ho Chi Minh City and one in Da Nang.

Saigontourist welcomed 2.92 million visitors last year, up 14.8 per cent. Average occupancy at its hotels was 68 per cent, up from 64 per cent in 2017. The company recorded revenue of VND6.7 trillion ($288.8 million), up 7 per cent, and consolidated after-tax profit of VND983 billion ($42.3 million), down 15 per cent.

As at the end of 2018, Saigontourist had total assets of VND11.9 trillion ($517 million), charter capital of VND7 trillion ($301 million), and undistributed profit of more than VND2 trillion ($86 million).

Benthanh Group

Ben Thanh Group, established in December 1997, has invested in 32 member enterprises in four fields: tourism services, trade services, real estate services, and industrial production.

Member companies include Ben Thanh Jewelry (BTJ-owned Precita), the Car Distribution Company Saigon General Service Corporation (Savico), Hue Travel, Ben Thanh Tourist, Norfolk Mansion serviced apartments, and the Phu Nhuan Trading JSC.

The Group also owns a diverse network of 25 hotels and resorts, such as Sofitel Saigon Plaza, Renaissance Riverside Hotel Saigon, Norfolk Hotel, Saigon Quang Binh Hotel, and Saigon Ninhchu Hotel & Resort.

Last year it recorded net revenue of VND385 billion ($16.5 million), up 62 per cent, but its after-tax profit fell 38 per cent to VND175 billion ($7.5 million).

As at the end of 2018, the company’s total value of investments in joint ventures and associates was VND1.2 trillion ($51.5 million), bringing dividends and annual profit of over VND130 billion ($5.6 million).

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