Finding bright spots amid gloom
The market has little prospects to grow in the short term but there are still opportunities for investors, including Da Nang Rubber Co (DRC) and PetroVietnam Southern Gas (PGS), say FPT Securities Co analysts.
“ Da Nang Rubber had positive performance in the first nine months of this year despite economic difficulties and rising input prices,” said analyst Nguyen Ngoc Tuan.
DRC had earned 1.97 trillion VND (92.5 million USD) by the end of the third quarter, 85.5 percent of the entire year’s target, and posted a profit of 139 billion VND (6.5 million USD), 92.7 percent of the target. It also had higher earnings-on-assets and earnings-on equity ratios than its competitors, and there was potential for the company to increase its margins, Tuan said.
DRC’s new plant in the central city of Da Nang ….was also expected to begin operations next year. The plant was built at a cost of about 2.4 trillion VND (113 million USD), 70 percent of which came from financing.
The companies’ debt load therefore rose last year but remained low compared to other companies, Tuan said.
“DRC has a long-term potential appropriate for a value investment portfolio,” he said.
DRC shares on Dec. 7 tracked overall market trends and closed down by 1.1 percent to 18,700 VND per share after two weeks of gains.
Meanwhile, PGS offered advantages in terms of resources from its parent company – PetroVietnam Gas Corporation – and financing from PetroVietnam Finance (PVF), said analyst Tran Quang Vinh.
PGS currently holds a 33-percent of the southern gas market, and aims to increase this to 50 percent by 2015.
“Profitability indicators for the share are better than for other firms, and its share price has been increasing for the past six months,” Vinh said. He recommended buying this stock when it hit around 20-23,000 VND on Dec. 7, it declined to a close of 24,000 VND per share.
Shares on the HCM Stock Exchange lost ground overall on Dec. 7, with trades sluggish on both of the nation’s stock exchanges.
On the HCM City bourse, the VN-Index closed at 387.21 points, a slump of 0.77 percent from the previous session. Nearly 31 million shares changed hands, pulling the value of trades down 19.6 percent from the previous day to 406.7 billion VND (19.1 million USD). By the closing bell, advancers had outnumbered gainers by 133-81.
Blue chips witnessed a harsh day with only Sacombank (STB) out of the 10 leading shares by capitalisation posting gains. STB was also the most-active share on the HCM Stock Exchange, with over 2.6 million traded.
On the Ha Noi Stock Exchange on Dec. 7, the HNX-Index closed up by 0.43 percent to 62.51 points. Trades slowed to a value of just 245.2 billion VND(11.5 million USD) on a volume of 26.2 million shares, as losers overwhelmed gainers by 174-59.
With three million shares changing hands, VNDirect Securities Co (VND) emerged as the most-active share nationwide./
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