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$67 billion high-speed railway mega project in Vietnam: Many businesses face great opportunities

The North-South high-speed railway project will create a big boost for listed enterprises, especially in the fields of steel, construction, cement, stone, etc.


According to Dau Tu newspaper, on the afternoon of November 30, 2024, the 15th National Assembly approved the investment policy for the North-South high-speed railway project with the approval of 443/454 delegates, 7 delegates did not approve and 4 delegates did not participate in the vote. The project has a preliminary total investment of up to 1,713,548 billion VND (more than 67 billion USD), implemented in the form of public investment with the goal of basic completion by 2035.


Source: Steel Industry Report - November 2024
Source: Steel Industry Report/November 2024 - Vietdata

The project has a total length of about 1,541km, connecting Ngoc Hoi station (Hanoi) to Thu Thiem station (HCMC), and passing through 20 provinces and cities. The investment scale includes a 1,435mm gauge double-track line with a design speed of up to 350 km/h and a load capacity of 22.5 tons/axle. The project will include 23 passenger stations, and 5 freight stations and use electrified railway technology, serving both passenger and defense transport needs.


The total land use demand for the project is about 10,827 hectares, including rice fields, forestry land, and other types of land. To implement the project, about 120,836 people will have to be resettled. Funds will be mobilized from the State Budget and other legal sources in the medium-term public investment plans.


The National Assembly decided that the implementation progress is to prepare a feasibility study report from 2025, striving to basically complete the project by 2035.



According to the previous project implementation plan, the Ministry of Transport plans to prioritize resources to start construction of the two sections Hanoi - Vinh and Ho Chi Minh City - Nha Trang, totaling about 642km by the end of 2027. According to a report by Yuanta Vietnam Securities, the total investment for this phase is estimated at 29.1 billion USD. With a large investment, the North-South high-speed railway project promises to open up great opportunities for listed enterprises on the stock exchange.


Specifically, the steel industry is expected to benefit the most from the high-speed railway mega project, especially when the Government prioritizes the use of domestically produced steel. Large steel enterprises such as Hoa Phat Group (HPG) will benefit thanks to the advantages of hot-rolled coil (HRC) products and the Dung Quat 2 factory, thereby expanding production capacity.



Regarding the stone industry, Yuanta Securities expects that enterprises such as Binh Duong Minerals and Construction JSC (KSB), Vinh Long Construction Materials JSC (VLB) and Hoa An JSC (DHA) will benefit from large reserves and long-term mining licenses, ready to supply stone for the project.


Regarding the cement industry, leading enterprises such as Ha Tien 1 Cement JSC (HT1) and Bim Son Cement JSC (BCC) will have great opportunities thanks to their production capacity and ability to meet material needs during the project implementation phase.


In addition, the securities company expects that domestic contractors will have the opportunity to win contracts such as Coteccons Construction JSC (CTD), Fecon JSC (FCN), Cienco4 Group JSC (C4G) and Deo Ca Transport Infrastructure Investment JSC (HHV).


In addition to the construction materials industry, the banking group is also expected to benefit from the project, huge banks with low capital costs such as the Joint Stock Commercial Bank for Foreign Trade of Vietnam (VCB), the Joint Stock Commercial Bank for Investment and Development of Vietnam (BID) and the Vietnam Joint Stock Commercial Bank for Industry and Trade (CTG) can participate in providing finance for this large-scale project.


(Theo Kien thuc Dau tu)


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