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As IPOs increase, investors and regulators voice concern
A number of large corporations are planning to float this year due to a perceived upturn in the economy.
Recently, PetroVietnam Finance Corporation (PVFC), considered a "blue chip" by investors, announced its intention to list shares this October. Another giant in the financial sector Foreign Trade Bank of Viet Nam (Vietcombank) is also expected to list on the HCM City Stock Exchange this year.
Meanwhile, construction giant Vinaconex Corporation is also planning to sell stock in the remaining months of 2008.
These firms have said that an upturn in the economy had positively impacted on the stock market.
"More new investors are coming to the bourse enthusiastic about securities investment," said Do Tien Quang, a senior member of Vinaconex’s Planning and Strategy Department.
In addition, investors consider giant corporations’ decisions to list a promising source of shares, especially at this time.
"Big stocks pipelined to the market will help provide traders with opportunities [to diversify], thereby avoiding the risk of overgain or overloss from one or two blue chips," said an anonymous official at the Securities Offering Management Department under State Securities Commission.
However, the listing of giant corporations in the near future is causing some investors to worry – as well as market regulators, concerned about share volume and pricing.
SMEs list in droves
A number of unlisted small and medium-sized firms (SMEs) are also preparing to float this year.
One of those is Licogi 16 Ltd Company, which has completed the procedures for listing, and Tan Phu Plastic Company, which is preparing to hold a stakeholders meeting before making a final decision.
According to Thuy Quyen, a broker for Click&Phone Securities, the sluggishness of the OTC market was encouraging enterprises to list on the Ha Noi or HCM City bourses.
"Furthermore, official market fluctuations will not impact much on those firms, and vice versa. Thus, listing in the SME-sector is much easier than for giant corporations," added Quyen, noting that companies still had to take care of pricing and volume matters to prevent unexpected results.
"There has been much talk about listing. Saying any more is just repetition," said Dao Van Khanh, an analyst of Agribank Securities. The key factor is how well enterprises are actually performing. That is what will govern how things go on the official bourse, he added.
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