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Stock market needs new stocks, analysts say
Enterprises that have already carried out initial public offerings (IPOs) should quickly begin trading their shares on the stock market, which is showing signs of recovery, analysts said.
The Ho Chi Minh Stock Exchange’s VN-Index Wednesday rose for a seventh straight session.
A three-week rally of the benchmark index clawed back some of this year’s loss, leaving the exchange down only 47 percent since the first trading day of the year.
In late June the index was down 60 percent for the year.
The government, the major shareholders of the majority of newly IPO-ed firms, should encourage equitized enterprises to float on the exchange, said Ho Chi Minh City Economic University stock expert Le Dat Chi.
Equitization is the expression used to describe the partial privatization of government-owned enterprises.
Chi suggested IPOs of state-owned companies should be speeded up by conducting the IPO and the floatation at the same time.
He said this IPO approach enabled many countries around the world to quickly attract a large number of investors.
Truong Duy Khiem, an official from HCMC-based ACB Securities Company, said many firms were less eager to float on the exchange as they were afraid their share prices would be affected by the market’s bad performance this year.
“It’s not a big deal for enterprises, which have healthy earnings and transparency in their business operation, to be affected by the market’s fall for a short period,” Khiem said.
“Investors will soon find out the firms’ actual value.”
He also said a stock market with many stocks would attract more domestic and foreign investors.
“Shareholder benefits will increase when a company floats on the market,” said Nguyen Le Hung, an experienced investor at HCMC’s Saigon Securities Inc.
“And once a company is listed, information about its operations will become more available because of the transparency regulations.”
Hong, another HCMC trader, bought 1,500 shares in the IPO of the Bank for Foreign Trade of Vietnam, known as Vietcombank, last December.
Hong said she hoped the bank would list on the exchange as soon as possible.
The Hanoi-based bank, Vietnam’s largest partly private lender, delayed its domestic listing to this year’s third quarter.
It had initially planned to list shares on the country’s main exchange in HCMC in June.
Hong said Vietcombank’s current share price on the informal over-the-counter market (OTC) was lower than its IPO price, so listing on the exchange would help calm the banks’ shareholders.
Vietcombank raised around VND10.5 trillion (US$635 million) through the IPO, which valued the bank at around $10 billion, selling shares for an average price of VND107,860 apiece.
Thanhnien
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