TV1 Chairman Arrested in Bidding Fraud Case; H1 2026 Profit Dips 3%

Overview

Power Construction Consulting Joint Stock Company 1 (TV1) announced that its chairman, Nguyen Huu Chinh, has been arrested and prosecuted in connection with serious violations of bidding and accounting regulations. The company’s H1 2026 financial statements, reviewed by An Viet Audit Co., Ltd., include an emphasis of matter paragraph highlighting the ongoing investigation. TV1 reported a 16% increase in revenue but a 3% decline in net profit for the first half of 2026.

Key Facts

• Nguyen Huu Chinh, Chairman of TV1’s Board of Directors, was prosecuted and detained by the Ministry of Public Security’s Investigation Police Agency, then suspended from his position.
• The criminal case involves allegations of “violating bidding regulations causing serious consequences; violating accounting regulations causing serious consequences; embezzlement; bribery and accepting bribes.”
• As of June 30, 2026, the case is still under investigation with no final conclusion from state authorities; TV1’s Board and management state the company operates normally and no financial obligations requiring provisions have been identified.
• Nguyen Kim Cuong, Board member and General Director, has been assigned to oversee Board activities starting June 2, 2026.
• TV1 had to change its auditor for 2026 after all four Big4 firms declined to provide services; shareholders approved a new auditor, with 56.1% of voting shares represented (28 out of 2,290 shareholders).
• EVN, the largest shareholder with 54.34% of TV1’s capital, voted in favor; former Chairman Le Minh Ha, holding 14.2%, did not submit a vote.
• H1 2026 revenue reached VND 279 billion, up 16% year-on-year; net profit after tax was VND 57.8 billion, down 3%; gross margin narrowed from 39.3% to 34.8%.
• Total assets as of June 30, 2026, were VND 1,102 billion, slightly up from the start of the year.

What Happened

TV1 released its reviewed semi-annual consolidated financial statements, in which auditor An Viet Co., Ltd. included an emphasis of matter regarding a criminal case involving several TV1 leaders. The case includes charges of serious violations of bidding and accounting regulations, embezzlement, and bribery. The investigation is ongoing, and TV1’s Board and management assert that the company continues to operate normally and that no financial provisions are required as of June 30, 2026.

The arrest of Chairman Nguyen Huu Chinh has triggered leadership changes. Nguyen Kim Cuong, a Board member and General Director, was assigned to oversee Board operations from June 2. Additionally, TV1 had to replace its auditor for 2026 after all four Big4 firms declined the engagement. Shareholders approved a new auditor, with EVN—owning 54.34%—supporting the change, while former Chairman Le Minh Ha, holding 14.2%, did not vote.

Market Context

TV1 trades on the UPCOM exchange, closing at VND 20,400 on September 3, 2026. The company’s H1 results show revenue growth of 16% but a 3% profit decline, reflecting margin pressure. The legal issues and leadership instability could weigh on investor sentiment, though the company’s core business remains operational. The broader Vietnamese market has been sensitive to governance-related news, and TV1’s situation may attract scrutiny from minority shareholders.

Strategic Significance

For long-term investors, the key concern is governance risk. The arrest of the chairman and the auditor’s emphasis of matter highlight potential weaknesses in internal controls and compliance. The company’s reliance on EVN as a major shareholder provides some stability, but the outcome of the investigation could have financial or operational implications. The need to switch auditors due to Big4 refusals is a red flag that may affect confidence in financial reporting. Investors should monitor the investigation’s progress and any subsequent adjustments to financial statements.

What to Watch

• Final conclusions from the investigation and any potential fines or penalties.
• Further leadership changes or board restructuring.
• Q3 2026 financial results to see if margin pressure persists.
• Any restatements or additional provisions in the 2026 annual audit.
• Shareholder actions or regulatory responses regarding governance practices.