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Market warming up, businesses getting ready to enter the bourse
The warming up of the stock market in August has prompted enterprises to move ahead with their plans to list on the bourse.
The stock market has seen a vast volume of shares put into transactions recently. On September 5, Vinaconex (VCG), the construction giant, debuted at the Hanoi Securities Trading Centre (HASTC). It listed 149,985,150 shares, worth VND1,500bil ($93.75mil). Vinaconex is the second-biggest listed company at HASTC after Asia Commercial Bank (ACB), which has listed shares worth VND2,630bil ($164.37mil).
Prior to that, VNECO1, Song Da Installation, Construction and Investment Corporation, Gia Lai Culture and Tourism Company also entered the Hanoi bourse.
At the HCM City Stock Exchange, on September 9, Sonadezi Long Thanh, which has the chartered capital of VND100bil ($6.25mil), put 10mil shares into transaction. 20mil shares of Vinaship, a shipping firm, also made their debut the same day.
It is expected that by the end of the year, 43 more companies with the total chartered capital of VND5,800bil will have listed on the two bourses. These include giants in different business fields, such as Hoang Anh Gia Lai (VND1,200bil or $75mil), Phu Nhuan Jewellery Company (VND300bil or $18.75mil), Saigon-Hanoi Bank (VND2tril or $125mil). Some coal-exploiting companies will list on Hanoi’s bourse, namely Cao Son Coal Company (VND100bil in chartered capital), Deo Nai (VND80bil), and Ha Tu (VND91bil).
A lot of companies have also been licenced by the State Securities Commission to issue more shares. HASTC has allowed three companies to list additional shares, including Hoa Phat Group (HPG), which has listed an additional volume of 56,103,998 shares worth VND561bil in face value. Kinh Do Group has been allowed to list 10,115,211 shares worth VND101bil, while Sieu Thanh Company (ST8) 818,267 shares. Saigon Thuong Tin Bank has got approval to issue 67mil additional shares worth VND667bil.
The recovery of the stock market has prompted enterprises to quickly reinitiate plans to list on the bourse and issue more shares after a long time of delaying. Share auctions have also warmed up after many months of quietness. In late August, all 3.8mil shares of Agribank’s Jewellery Company were sold at an auction at HASTC. 116 investors registered to join the auction and ordered to purchase a volume of shares triple the offered volume.
The auction by the company has been considered a great success as the auctions in the first seven months of the year did not catch the attention of investors.
At HOSE, no auction took place in July, while it is expected that a series of auctions will occur in September and October: the auction of 1,550,000 shares of Irrigation Works Construction Company No 4, 1mil shares of Pymepharco, and others.
Investors have also been encouraged by the news that big corporations, namely MobiFone, Mekong Housing Development Bank, Vietinbank may be allowed to sell stakes to strategic partners before offering shares to the public, which will help the stake sale process go more rapidly.
The warming up of the market has encouraged businesses to seek capital on the bourse. However, they have been warned that if they do not have plans to use the capital to be mobilised from the bourse in an effective way, they should not think of mobilising capital at this moment.
Nguyen Ngoc Tuoi, Individual Clients Director under Kim Eng Vietnam Securities Company, said that if all companies seek capital on the bourse at the same time, investors’ money will become exhausted, thus affecting issuance results.
VNN
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