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Foreign ownership plans excite markets, investors
Plans of increasing the percentage of foreign ownership will continue gripping the attention of investors when companies propose them in their annual general shareholder meetings (AGM) normally taking place in the second quarter of the year, securities experts said.
Securities officials and researchers, who met to talk about investment trends in a recent online conference, said if public companies announced their plans, the market will become agitated.
Doan Thi Thanh Truc, from Rong Viet Securities Company, said foreigners continued to be net sellers since the beginning of the year. However, foreign investors are becoming net buyers again of late.
Truc said foreigners would continue to be net buyers in the next quarter, thanks to better price earnings ratio and potential earnings per share.
Pham Van Thinh from Deloitte Viet Nam said more openness to foreign investment was mandatory now as Viet Nam has signed more agreements such as the Trans-Pacific Partnership (TPP) and free-trade agreements. At the same time, State-owned enterprises (SOEs)'s equitisation plans will make more than 200 SOEs sell their shares at IPOs this year and, thus, investors will have an opportunity to choose good stocks at a reasonable price on the primary market for long-term holding.
IPOs of large enterprises such as Mobifone, Satra and the Ben Thanh Group are receiving a lot of attention from investors in 2016.
Under the TPP, foreign investors can own a 65 per cent stake in a local enterprise, instead of 49 per cent as at present.
Working in the garment and textile industry, which is considered to be the industry that will gain the most by the TPP, Chairman of the TNG garment company Nguyen Van Thoi said his firm would allow 100 per cent foreign ownership.
Seven stocks have raised their maximum foreigner ownership limit so far, such as 100 per cent in SSI, VHC and EVE; 49 per cent in BIC and REE; and 20 per cent in MBB.
Last week, TSC and AAA also announced their plan to offer 100 per cent stake to foreigners.
Director of the State Securities Commission Nguyen Son said though raising the stake limit for foreigners in public companies could be an attraction in the local market, it was not the trend for all companies.
Son said of the 700 listed companies, only 30 have raised their foreign ownership ratio to the maximum, while the rest have low or no foreign ownership.
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