Where are Novaland’s hidden profits worth thousands of billions?

Novaland (NVL) continues to face financial difficulties, reporting a loss of nearly 190 billion VND in Q2 2025, adding to a total of 666 billion VND in cumulative losses. While revenue reached 3,715 billion VND, Novaland executed significant capital divestments worth 6 trillion VND, including major transactions in June. These deals are not recorded in the income statement as the company retains over 51% ownership in its subsidiaries. Instead, the profits from these transactions are reflected in the retained earnings in the balance sheet, amounting to 1,848 billion VND. Although the income statement remains poor, Novaland has reclaimed approximately 11.2 trillion VND from capital sales, offsetting cash flow deficits from core operations. Accounting regulations allow Novaland to recognize gains and losses from divestments without clear visibility on the profit and loss statement, creating ‘hidden profits’ for the company.