Wednesday, 18/02/2009 08:13

Listed companies: Process of raising capital kicks off

Listed companies have been hurrying to implement  their plans to raise their chartered capital to be eligible to list on the bourse they want. 46 companies listed at the HCM City Stock Exchange will have to shift to list on the Hanoi bourse if they do not have VND80bil in chartered capital prior to August 8, 2009.

The actions of companies

DIC, an investment and trade company, has drawn up a plan on raising chartered capital from VND67bil to VND82bil. “We may fulfill the capital increase to over VND80bil by June 2009 in order to be eligible to stay on the HCM City bourse,” said Thuy Nga, Finance Director of DIC.

GMC, a garment and trade company, is also one of the companies which must raise chartered capital if it wants to stay in HCM City. Under the plan on raising capital, existing shareholders have to buy GMC at VND12,000/share with the ratio 5:2, while GMC are being traded at VND13,000/share on floor.

GMC’s strategic shareholders have deposited VND7bil to purchase 1.6mil shares at VND27,000/share so far.

GMC has been determined to raise chartered capital, because listing on another bourse is believed would badly affect the company’s brand name. A listing on the HCM City bourse, which sets higher requirements than the Hanoi bourse, can help make investors feel safe when injecting money in GMC.

The HCM City Stock Exchange has sent a document to the companies which have the chartered capital of less than VND80bil instructing them to submit plans on capital increases prior to February 28.

The reasonable requirements

Though admitting that the requirements on higher chartered capital will put difficulties on companies, no one is protesting the decision.

Le Dat Chi, a securities expert, said: “I strongly advocate the viewpoint that the companies which do not have the required chartered capital should have to shift to list on another bourse."

Chi added that the HCM City bourse (HOSE) needs to display the commodities with high quality in order to attract foreign investment and improve the market's liquidity.

“One of the criteria to evaluate businesses is financial capability, including capital scale,” Chi added.

He went on to say that if listed companies have to shift to list on the Hanoi bourse, they will have to spend a small sum to move to the bourse and a little time. But he does not think that the shifting will cause troubles for those business’ operations.

HOSE’s General Director Tran Dac Sinh also said that the standards required for listed commodities need to be clear in the period of Vietnam’s integration into the world.

Two bourses competing with each other?

The regulations stipulate that companies with chartered capital of VND80bil and higher will be listed on HCM City bourse, while companies with VND10bil will be listed on the Hanoi bourse. However, the regulations do not clearly stipulate that the Hanoi bourse can receive listed companies with more than VND80bil in chartered capital.

HOSE has worked out with ACB’s board of directors on the bank’s shifting to list on the HCM City bourse. HOSE said that it will work with every business which can meet the requirements for listing on HCM City bourse, to shift to list in HCM City.

HOSE is building up a new procedure, which allows enterprises to automatically shift bourses without having to follow long formalities.

39 companies listing shares on Hanoi’s bourse are eligible to list on the HCM City bourse.

If there is not a clear mechanism, the two bourses will compete with each other to attract big companies, experts have warned.

VietNamNet/DTCK

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