March:1, 2007: 424.68
March 31, 2007: 404.08
Change: -20.6 (4.85%)
Maximum: 459.36
Minimum: 371.94
Saturday, March 31, 2007
HaSTC-Index: March 2007
March:1, 2007: 424.68
March 31, 2007: 404.08
Change: -20.6 (4.85%)
Maximum: 459.36
Minimum: 371.94
VN-Index: March 2007
March 1, 2007: 1123.07
March 31, 2007: 1070.33
Change: -52.74 (4.70%)
Maximum: 1170.67
Minimum: 1031.79
Vincom licensed to build recreation center in Hanoi
Vincom Joint Stock Company, which owns Vincom City Towers, a large commercial center in Hanoi, got the license Thursday to build a 94 million US$ entertainment complex in suburban Hanoi.
The 500 ha complex, straddling Long Bien and Gia Lam districts, will comprise a 36 hole golf course, shopping malls, restaurants, a hotel, villas.
Work on the project is expected to kick off in August and will be done in two phases.
The golf course – the largest in the city – a tourist port on the Hong (Red) River, a park, shopping malls, restaurants, and other leisure facilities will be completed first.
However, it is not known when the work will be completed. A second phase will see the construction of the hotel and villas.
Vincom is planning to list on the Ho Chi Minh City stock exchange this year.
It has already applied to the State Securities Commission to make an initial public offering and said details would be revealed upon receiving approval.
The company has tied up with a local partner to renovate the Thong Nhat Park also at a cost of $94 million.
Vincom Joint Stock Co was established in 2002 with a chartered capital of VND251 billion (15.7 US$ million).
It has since increased its capital to VND600 billion.
Source: Thanh Nien
The 500 ha complex, straddling Long Bien and Gia Lam districts, will comprise a 36 hole golf course, shopping malls, restaurants, a hotel, villas.
Work on the project is expected to kick off in August and will be done in two phases.
The golf course – the largest in the city – a tourist port on the Hong (Red) River, a park, shopping malls, restaurants, and other leisure facilities will be completed first.
However, it is not known when the work will be completed. A second phase will see the construction of the hotel and villas.
Vincom is planning to list on the Ho Chi Minh City stock exchange this year.
It has already applied to the State Securities Commission to make an initial public offering and said details would be revealed upon receiving approval.
The company has tied up with a local partner to renovate the Thong Nhat Park also at a cost of $94 million.
Vincom Joint Stock Co was established in 2002 with a chartered capital of VND251 billion (15.7 US$ million).
It has since increased its capital to VND600 billion.
Source: Thanh Nien
Friday, March 30, 2007
Viettel does not plan IPO
Vietnamese military telecoms giant Viettel told a press briefing Wednesday that an initial public offering was not in the cards at the moment out of fear it would impact major plans to expand the network nationwide.
Earlier this month, the government cleared the way for the mobile services provider to go public, but Nguyen Manh Hung, Deputy General Director, said if Viettel issued shares, short-term targets set by its would-be shareholders were likely to deter the corporation from developing more base stations in outlying areas of Vietnam.
“It would go against Viettel’s operation policy to bring mobile phone services to Vietnamese people from all walks of life, including in rural areas which may not be as profitable as other moves,” Hung said.
Besides, Hung also voiced concern that if Viettel went public, its promotional rate packages could fall outside regulations set by securities trading centers.
Hung emphasized that with the aim of becoming Vietnam’s flagship mobile phone provider this year, Viettel, instead of looking to go public, would do it best to improve service quality, expand the mobile phone network, and lure more subscribers.
Source: Thanh Nien Mekong Capital Equity Vinacapital Fund
Earlier this month, the government cleared the way for the mobile services provider to go public, but Nguyen Manh Hung, Deputy General Director, said if Viettel issued shares, short-term targets set by its would-be shareholders were likely to deter the corporation from developing more base stations in outlying areas of Vietnam.
“It would go against Viettel’s operation policy to bring mobile phone services to Vietnamese people from all walks of life, including in rural areas which may not be as profitable as other moves,” Hung said.
Besides, Hung also voiced concern that if Viettel went public, its promotional rate packages could fall outside regulations set by securities trading centers.
Hung emphasized that with the aim of becoming Vietnam’s flagship mobile phone provider this year, Viettel, instead of looking to go public, would do it best to improve service quality, expand the mobile phone network, and lure more subscribers.
Source: Thanh Nien Mekong Capital Equity Vinacapital Fund
PetroVietnam to build hotel complex
The Hanoi administration gave approval Thursday to Vietnam Oil and Gas Corp. (PetroVietnam) to build a five-star hotel and commercial-residential complex at a cost of 90 million US$.
The complex will be built on a 3.7 hectare site in Tu Liem district’s Me Tri Culture and Sports Park.
PetroVietnam’s director general, Tran Ngoc Canh, said it would contain at least 350 hotel rooms besides a number of luxury apartments and offices.
An 88-storey office building, Vietnam’s tallest structure, would be built along with an imposing commercial and entertainment center, he added.
The company’s real estate arm, Petrowaco, is working on procedures and land acquisition in preparation for construction which will start before September.
Tran Ngoc Binh, Petrowaco’s deputy director general, said the complex would be completed by March 2010, in time for the 1000th anniversary of Hanoi.
Hanoi recently approved two other deluxe hotels, each at a cost of 500mio US$ – the Japanese Riviera Corporation and CSK Finance Company consortium’s 500mio US$ five-star hotel in the outlying Tu Liem District, and Korean Keangnam’s five-star hotel near the National Convention Center.
Source: Thanh Nien Mekong Capital Equity Vinacapital fund
The complex will be built on a 3.7 hectare site in Tu Liem district’s Me Tri Culture and Sports Park.
PetroVietnam’s director general, Tran Ngoc Canh, said it would contain at least 350 hotel rooms besides a number of luxury apartments and offices.
An 88-storey office building, Vietnam’s tallest structure, would be built along with an imposing commercial and entertainment center, he added.
The company’s real estate arm, Petrowaco, is working on procedures and land acquisition in preparation for construction which will start before September.
Tran Ngoc Binh, Petrowaco’s deputy director general, said the complex would be completed by March 2010, in time for the 1000th anniversary of Hanoi.
Hanoi recently approved two other deluxe hotels, each at a cost of 500mio US$ – the Japanese Riviera Corporation and CSK Finance Company consortium’s 500mio US$ five-star hotel in the outlying Tu Liem District, and Korean Keangnam’s five-star hotel near the National Convention Center.
Source: Thanh Nien Mekong Capital Equity Vinacapital fund
Credit Suisse wishes to expand investments in Vietnam
Brady Dougan, Chief Executive Officer of Credit Suisse Investment Banking, has expressed his desire to increase the bank's involvement in the financial market of Viet Nam and pour more investment into its key projects.
At a recent meeting with Finance Minister Vu Van Ninh in Ha Noi, Dougan said the improvement in Viet Nam's credit outlook as rated by Moody's Investors Service from stable to positive further proved the impressing development of the country's economy, education, laws and administrative reform.
Minister Ninh proposed that Credit Suisse Investment Banking well carry out its set projects and programmes to develop the Vietnamese financial market and help local businesses acquire more experiences to join the international market.
Credit Suisse Investment Banking has offered professional advices on equitisation to the Bank for Foreign Trade of Viet Nam (Vietcombank) and the Viet Nam Insurance Corporation (BaoViet).
The bank arranged loans worth 1.7 billion USD for the Viet Nam Shipbuilding Industry Group (Vinashin) and Viet Nam National Shipping Lines (Vinalines) and an export credit of 1 billion USD for Vietnamese commercial banks and businesses.
It also advised the Ministry of Finance on national credit rating and acted as the main guarantor for the first issue of government bonds in the international market in 2005.-
Source: VNA
At a recent meeting with Finance Minister Vu Van Ninh in Ha Noi, Dougan said the improvement in Viet Nam's credit outlook as rated by Moody's Investors Service from stable to positive further proved the impressing development of the country's economy, education, laws and administrative reform.
Minister Ninh proposed that Credit Suisse Investment Banking well carry out its set projects and programmes to develop the Vietnamese financial market and help local businesses acquire more experiences to join the international market.
Credit Suisse Investment Banking has offered professional advices on equitisation to the Bank for Foreign Trade of Viet Nam (Vietcombank) and the Viet Nam Insurance Corporation (BaoViet).
The bank arranged loans worth 1.7 billion USD for the Viet Nam Shipbuilding Industry Group (Vinashin) and Viet Nam National Shipping Lines (Vinalines) and an export credit of 1 billion USD for Vietnamese commercial banks and businesses.
It also advised the Ministry of Finance on national credit rating and acted as the main guarantor for the first issue of government bonds in the international market in 2005.-
Source: VNA
Vietnam-Germany Steel Pipe JV to sell equity to public
The Viet Nam Germany Steel Pipe Joint Stock Company (VG Pipe) plans to issue 3.5 million shares with book building on April 2-12, said Le Minh Hai, company general director.
The capital raised will go toward new facilities, including a 2 million USD steel mill to produce construction material such as bolts. The company also plans to erect a trade centre, investing 1.87 million USD in the first phase of the project.
The VG Pipe has selected Seabank Securities JSC as the financial advisor and underwriter for the share issuance.
In 2006, the company reported 297.52 billion VND (18.59 million USD) in revenue and has 35 billion VND (2.18 million USD) in equity, which is expected to increase to 70 billion VND after listing on the stock market.
VG Pipe plans to issue a second lot of shares in the second quarter of 2008, said Hai.
VG-Pipe specialises in producing steel pipe and other steel products for industrial construction. Currently, the company has a 25% stake in the local market.
Source: VNA Mekong Capital Vinacapital Equity Vietnam
The capital raised will go toward new facilities, including a 2 million USD steel mill to produce construction material such as bolts. The company also plans to erect a trade centre, investing 1.87 million USD in the first phase of the project.
The VG Pipe has selected Seabank Securities JSC as the financial advisor and underwriter for the share issuance.
In 2006, the company reported 297.52 billion VND (18.59 million USD) in revenue and has 35 billion VND (2.18 million USD) in equity, which is expected to increase to 70 billion VND after listing on the stock market.
VG Pipe plans to issue a second lot of shares in the second quarter of 2008, said Hai.
VG-Pipe specialises in producing steel pipe and other steel products for industrial construction. Currently, the company has a 25% stake in the local market.
Source: VNA Mekong Capital Vinacapital Equity Vietnam
Thursday, March 29, 2007
Investors turn to hunt for bonds
As experts have many times warned that shares were overvalued and share prices had far exceeded Investors who placed orders in many successive trading sessions, but failed to buy shares, are now injecting money in bonds - a good alternative.their actual values, investors do not expect share prices to increase any more. That explains why investors now are tending to hunt for bonds instead of shares.
Hoang Xuan Giang, an investor who once hunted for MB shares, now is trying to buy MB bonds. Mr Giang said that if he bought 4 MB bonds at VND3.2-3.3mil/bond instead of one MB share at VND12-13mil/share (the face value is VND1mil/share), he would earn a profit four times higher than the invested sum of money after five years, when the bonds would be converted into shares. Even if MB share prices dropped by 50%, the profit would still be double the invested sum of money.
Investors are now buying bonds, considering this a safer investment channel as bond prices do not see big fluctuations like share prices. Even if the market freezes, bond holders would still get higher profit as bond interest rates are higher than share dividends.
Bonds issued by the Saigon Securities Incorporated (SSI) are also being hunted by investors. SSI shares are listed among the blue chips at the Hanoi Securities Trading Centre (HASTC). As SSI shares are valuable on the market, investors are rushing to buy SSI bonds, hoping that when the bonds are converted into shares, they will get fat profit. Now SSI bonds are trading at VND800-820,000/unit (the face value is VND100,000), and the bonds will be converted into shares in 2008, while SSI shares are selling at VND240,000/share.
Just several months ago, purchasing bonds was considered the job of the ‘coward’ investors, who dared not play on the official ‘playing field’. However, bonds now are listed in the portfolios of many investors.
Nguyen Anh Tuan, an investor at BSC trading floor, said that investors were now thinking of purchasing bonds because investments in shares would not bring the fat profit it did in the past year. He said that the market would fall down after a long time of heating, and it was the right time to restructure investment portfolios.
Source: VNE Equity Vietnam Mekong Capital
Hoang Xuan Giang, an investor who once hunted for MB shares, now is trying to buy MB bonds. Mr Giang said that if he bought 4 MB bonds at VND3.2-3.3mil/bond instead of one MB share at VND12-13mil/share (the face value is VND1mil/share), he would earn a profit four times higher than the invested sum of money after five years, when the bonds would be converted into shares. Even if MB share prices dropped by 50%, the profit would still be double the invested sum of money.
Investors are now buying bonds, considering this a safer investment channel as bond prices do not see big fluctuations like share prices. Even if the market freezes, bond holders would still get higher profit as bond interest rates are higher than share dividends.
Bonds issued by the Saigon Securities Incorporated (SSI) are also being hunted by investors. SSI shares are listed among the blue chips at the Hanoi Securities Trading Centre (HASTC). As SSI shares are valuable on the market, investors are rushing to buy SSI bonds, hoping that when the bonds are converted into shares, they will get fat profit. Now SSI bonds are trading at VND800-820,000/unit (the face value is VND100,000), and the bonds will be converted into shares in 2008, while SSI shares are selling at VND240,000/share.
Just several months ago, purchasing bonds was considered the job of the ‘coward’ investors, who dared not play on the official ‘playing field’. However, bonds now are listed in the portfolios of many investors.
Nguyen Anh Tuan, an investor at BSC trading floor, said that investors were now thinking of purchasing bonds because investments in shares would not bring the fat profit it did in the past year. He said that the market would fall down after a long time of heating, and it was the right time to restructure investment portfolios.
Source: VNE Equity Vietnam Mekong Capital
Energy sector under pressure
The electricity sector is under great financial pressure due to the nation's fast pace of development and rapidly growing hunger for energy, according to industry experts, who say stepping up the equitisation of companies in the sector may be the only feasible way to alleviate the problem.
Current estimates place growth on the load of the nation's electrical grid a 13-15 percent per year, at which rate the sector would have to invest in the next seven years an amount equivalent to what it has invested in the past 50 years in order to keep pace.
According to Electricity of Vietnam (EVN), in order to meet annual demand by 2015 of about 190 billion kWh, nearly four times higher than today's electrical consumption, the total capacity of EVN power plants would need to grow to over 42,000 MW.
On average, according to EVN, it costs $ 1million to produce each 1 MW, not to mention investment in expanding the power grids. In total, the sector will need $ 45 billion over the next ten years to develop capacity.
In this context, equitisation has become increasingly urgent as a means to generate capital.
The Electricity Law, Investment Law, Construction Law and a ministerial-level regulation on independent power producers have laid the groundwork for encouraging private investment in electrical generation and distribution, while the State is committed to continue its monopoly over power transmission.
Power generation by private investors has been increasing accordingly. In addition to big thermo-power projects set up by major economic groups such as PetroVietnam and Vinacomin, the number of IPPs to register projects over the past five years has reached 190 with a total capacity of nearly 3,200 MW.
By December 2006, 17 of these projects were generating power, 40 had begun construction, and 78 had had feasibility studies approved.
"To diversify investment in the power sector, power generated by IPPs and joint stock plants has increased from two percent in 2002 to more than 13 percent in 2004 and about 40 percent in 2006," said Tran Anh Thai, director of the Vietnam Power Resource Partners Corporation.
Increasing equitisation of the power sector has also helped the sector increase its ability to attract funds for developing power infrastructure, according to experts.
EVN revealed that it would earn more than VND 11 trillion ($688 million) by 2008 by selling shares in its subsidiary enterprises, about half of EVN's total capital requirements to this period.
To hasten equitisation, EVN will establish joint stock companies to manage power plants under-construction power plants and draw funds from the market by selling minority interests in these companies.
While the time has come to step up privatisation of power sources, many experts have warned that the sector needs to overcome a spate of challenges in managing capital, operations, and planning as many new investors lack experience and professionalism.
Experts suggest coordinated solutions such as improved State management, better planning to ensure the feasibility of projects, open selection of potential investors, incentives to draw investors to unattractive projects, and policies encouraging direct and indirect investment through equitisation and the stock market.
Source: VNE Equity Vietnam Mekong Capital
Current estimates place growth on the load of the nation's electrical grid a 13-15 percent per year, at which rate the sector would have to invest in the next seven years an amount equivalent to what it has invested in the past 50 years in order to keep pace.
According to Electricity of Vietnam (EVN), in order to meet annual demand by 2015 of about 190 billion kWh, nearly four times higher than today's electrical consumption, the total capacity of EVN power plants would need to grow to over 42,000 MW.
On average, according to EVN, it costs $ 1million to produce each 1 MW, not to mention investment in expanding the power grids. In total, the sector will need $ 45 billion over the next ten years to develop capacity.
In this context, equitisation has become increasingly urgent as a means to generate capital.
The Electricity Law, Investment Law, Construction Law and a ministerial-level regulation on independent power producers have laid the groundwork for encouraging private investment in electrical generation and distribution, while the State is committed to continue its monopoly over power transmission.
Power generation by private investors has been increasing accordingly. In addition to big thermo-power projects set up by major economic groups such as PetroVietnam and Vinacomin, the number of IPPs to register projects over the past five years has reached 190 with a total capacity of nearly 3,200 MW.
By December 2006, 17 of these projects were generating power, 40 had begun construction, and 78 had had feasibility studies approved.
"To diversify investment in the power sector, power generated by IPPs and joint stock plants has increased from two percent in 2002 to more than 13 percent in 2004 and about 40 percent in 2006," said Tran Anh Thai, director of the Vietnam Power Resource Partners Corporation.
Increasing equitisation of the power sector has also helped the sector increase its ability to attract funds for developing power infrastructure, according to experts.
EVN revealed that it would earn more than VND 11 trillion ($688 million) by 2008 by selling shares in its subsidiary enterprises, about half of EVN's total capital requirements to this period.
To hasten equitisation, EVN will establish joint stock companies to manage power plants under-construction power plants and draw funds from the market by selling minority interests in these companies.
While the time has come to step up privatisation of power sources, many experts have warned that the sector needs to overcome a spate of challenges in managing capital, operations, and planning as many new investors lack experience and professionalism.
Experts suggest coordinated solutions such as improved State management, better planning to ensure the feasibility of projects, open selection of potential investors, incentives to draw investors to unattractive projects, and policies encouraging direct and indirect investment through equitisation and the stock market.
Source: VNE Equity Vietnam Mekong Capital
ACE opens non-life insurance branch in Vietnam
ACE Asia Pacific, a division of the ACE Group of Companies - a global leader in insurance and reinsurance - announced the official opening of its non-life insurance branch in Ho Chi Minh City on Mar. 27.
Viet Nam is the newest addition to ACE's Asia Pacific network of general insurance offices available in 13 regional countries.
Speaking at the opening ceremony, ACE Limited President and CEO Evan Greenberg said: "Viet Nam is a significant and fast-growing economy and its vitality offers many commercial prospects. Our goal in Viet Nam is to be a trusted insurance provider to both companies and individuals."
Apart from an office in HCM City, ACE Viet Nam will open a branch in Ha Noi, where it has maintained a representative office since 1996 to conduct market research and assist local regulatory agencies in strengthening the supervisory framework for the insurance sector.-
Source: VNA Equity Vietnam Mekong Capital
Viet Nam is the newest addition to ACE's Asia Pacific network of general insurance offices available in 13 regional countries.
Speaking at the opening ceremony, ACE Limited President and CEO Evan Greenberg said: "Viet Nam is a significant and fast-growing economy and its vitality offers many commercial prospects. Our goal in Viet Nam is to be a trusted insurance provider to both companies and individuals."
Apart from an office in HCM City, ACE Viet Nam will open a branch in Ha Noi, where it has maintained a representative office since 1996 to conduct market research and assist local regulatory agencies in strengthening the supervisory framework for the insurance sector.-
Source: VNA Equity Vietnam Mekong Capital
Vietinbank seeks IPO advisors
The state-owned Industrial and Commercial Bank of Vietnam (Vietinbank/Incombank) will call for tenders from prospective advisers for its initial public offering due later this year, a senior official said Wednesday.
Deputy General Director Nguyen Viet Manh said the tender process would take place soon, without specifying a date. The IPO is planned for October.
According to a statement from the bank – commonly known as Vietinbank – seven international banks will take part in the tender process - Lehman Brothers, Merrill Lynch, JP Morgan, UBS, Morgan Stanley, Macquarie, and Daiwa Securities.
Manh said Vietinbank, which has a registered capital of VND10 trillion (US$625 million), was expected to list its shares on the country's stock market later this year.
He didn't give details on the bank's plans to sell shares to foreign investors. Vietnamese law allows foreigners to hold up to 30% in domestic banks.
Vietnam has five state-owned commercial banks of which Vietcombank has signed a contract with Credit Suisse to act as its financial advisor for its IPO, planned for the third quarter this year.
The Vietnamese government has said it wants the five banks to sell shares to foreign investors by 2010 to boost their competitiveness.
Source: Thanh Nien Equity Vietnam Mekong Capital
AB Bank and BTI start partnership
Vietnam’s An Binh Joint Stock Bank and the Bach Viet Technology and Investment Corp (BTI) signed a strategic partnership Wednesday.
AB Bank will pick up a 5% stake in BTI for an undisclosed amount, sit on its management board, and provide financial and banking services.
It became the second bank to tie up with BTI after the state-run Vietnam Bank for Agriculture and Rural Development (Agribank) recently inked a deal with it.
Bach Viet produces CD and DVD disks at a plant in the My Xuan A Industrial Zone in southern Ba Ria – Vung Tau province near Ho Chi Minh City.
It holds 40% of the domestic market share and exports to countries like India and Cambodia.
It makes 170 million disks a year and reported a turnover of VND290 billion (US$18 million).
The company targets revenues of VND350 billion this year.
Source: Thanh Nien Equity Vietnam
AB Bank will pick up a 5% stake in BTI for an undisclosed amount, sit on its management board, and provide financial and banking services.
It became the second bank to tie up with BTI after the state-run Vietnam Bank for Agriculture and Rural Development (Agribank) recently inked a deal with it.
Bach Viet produces CD and DVD disks at a plant in the My Xuan A Industrial Zone in southern Ba Ria – Vung Tau province near Ho Chi Minh City.
It holds 40% of the domestic market share and exports to countries like India and Cambodia.
It makes 170 million disks a year and reported a turnover of VND290 billion (US$18 million).
The company targets revenues of VND350 billion this year.
Source: Thanh Nien Equity Vietnam
Wednesday, March 28, 2007
AlphaNam on course
Alphanam Electricity and Machinery Co profits for the first quarter will meet company expectations of around VND75 billion, says Board Chairman Nguyen Tuan Hai.
His assessment is based on strong returns from investments made throughout the first three months of the year.
On March 19, Alphanam purchased a 10 per cent stake in Phu Thai Distribution and Investment Group. The company also signed a memorandum of understanding to become a strategic partner in Civil Engineering Construction JSC No 118 (Momota), along with Cable and Telecommunications Material Co (Sacom).
Phan Chi Vinh, Momota general director, said the two co-investors would lend huge support to the company.
Alphanam signed another memorandum of understanding with Sacom to become a strategic partner.
Under the agreement, Alphanam holds 700,000 Sacom shares worth VND7 billion (US$437,500).
Nguyen Quang Huy, Alphanam deputy general director, said that joining forces with Sacom will help the company build a strong portfolio before it holds an initial public offering some time in the second quarter.
Alphanam shares in the over-the-counter market trade at about VND85,000 ($5.30) a piece.
Alphanam is also expanding its business overseas with a $5 million contract with Cambodia’s Amatak Angkor Elevator Co.
Alphanam, established in 1995, primarily produces electronic parts, composites and paints.
Last year, the company earned VND250 billion ($15.6million) in revenue, triple that of 2005, and offered a 30 per cent dividend payment. Revenues this year are expected to reach VND450 billion ($28.1 million).
Source: VNS
His assessment is based on strong returns from investments made throughout the first three months of the year.
On March 19, Alphanam purchased a 10 per cent stake in Phu Thai Distribution and Investment Group. The company also signed a memorandum of understanding to become a strategic partner in Civil Engineering Construction JSC No 118 (Momota), along with Cable and Telecommunications Material Co (Sacom).
Phan Chi Vinh, Momota general director, said the two co-investors would lend huge support to the company.
Alphanam signed another memorandum of understanding with Sacom to become a strategic partner.
Under the agreement, Alphanam holds 700,000 Sacom shares worth VND7 billion (US$437,500).
Nguyen Quang Huy, Alphanam deputy general director, said that joining forces with Sacom will help the company build a strong portfolio before it holds an initial public offering some time in the second quarter.
Alphanam shares in the over-the-counter market trade at about VND85,000 ($5.30) a piece.
Alphanam is also expanding its business overseas with a $5 million contract with Cambodia’s Amatak Angkor Elevator Co.
Alphanam, established in 1995, primarily produces electronic parts, composites and paints.
Last year, the company earned VND250 billion ($15.6million) in revenue, triple that of 2005, and offered a 30 per cent dividend payment. Revenues this year are expected to reach VND450 billion ($28.1 million).
Source: VNS
ADB: Vietnam may grow by more than 10%
According to the Asian Development Bank (ADB), Vietnam can completely obtain a double-digit growth rate in 2007, much higher than its goal of 8.5% if economic reform is intensified.
Director of ADB in Vietnam, Ayumi Kinishi, confirmed that after Vietnam becomes a member of WTO, export will be more favourable while domestic demand also grows strongly so this organization believes that Vietnam will achieve high growth rate this year.
ADB’s Asia Prospect Report 2007 released today, March 27, predicts that Vietnam can obtain GDP growth rate of 8.3% in 2007 and 8.5% in 2008.
However, ADB Vietnam Country Director emphasised that the number-one priority of Vietnam should be economic reforms.
“Vietnam should not focus on numbers. It is worrying if the growth rate is more than 9% or higher but it doesn’t come from reforms,” Mr Konishi said.
Omkar Shrestha, Deputy Director of ADB Vietnam, commented that Vietnam’s growth mainly relies on input factors like capital, human resources, and land, which are limited. The effectiveness of the use of input factors of Vietnam is reducing, he added.
For each US dollar pumped into production, China creates 3.4 units of products, 2.7 in Thailand and it is only 2.3 in Vietnam. In addition, Vietnam’s contingent of skilled labourers accounts for just 27% of the workforce compared to 50% of the region.
ADB experts, thus, warn that the country needs to shift its growth, which currently relies on capital, to growth based on creativeness and reforms.
“When the government speeds up reforms, high growth rate is a fact,” he said.
According to ADB Vietnam Director, Vietnam’s stock market is at the initial stage so many changes is unavoidable.
“It is worried if the stock market sees no adjustment,” he said.
He optimistically said that the stock market will continue growing but he warns that the problem comes from local investors.
“It is important to know how many investors who really understand about the stock market, how many investors who can read financial reports to analyses how are companies growing,” he said.
Companies’ provision of sufficient and accurate information for investors and the management ability of state bodies are also worried, he said.
Source: VNE
Director of ADB in Vietnam, Ayumi Kinishi, confirmed that after Vietnam becomes a member of WTO, export will be more favourable while domestic demand also grows strongly so this organization believes that Vietnam will achieve high growth rate this year.
ADB’s Asia Prospect Report 2007 released today, March 27, predicts that Vietnam can obtain GDP growth rate of 8.3% in 2007 and 8.5% in 2008.
However, ADB Vietnam Country Director emphasised that the number-one priority of Vietnam should be economic reforms.
“Vietnam should not focus on numbers. It is worrying if the growth rate is more than 9% or higher but it doesn’t come from reforms,” Mr Konishi said.
Omkar Shrestha, Deputy Director of ADB Vietnam, commented that Vietnam’s growth mainly relies on input factors like capital, human resources, and land, which are limited. The effectiveness of the use of input factors of Vietnam is reducing, he added.
For each US dollar pumped into production, China creates 3.4 units of products, 2.7 in Thailand and it is only 2.3 in Vietnam. In addition, Vietnam’s contingent of skilled labourers accounts for just 27% of the workforce compared to 50% of the region.
ADB experts, thus, warn that the country needs to shift its growth, which currently relies on capital, to growth based on creativeness and reforms.
“When the government speeds up reforms, high growth rate is a fact,” he said.
According to ADB Vietnam Director, Vietnam’s stock market is at the initial stage so many changes is unavoidable.
“It is worried if the stock market sees no adjustment,” he said.
He optimistically said that the stock market will continue growing but he warns that the problem comes from local investors.
“It is important to know how many investors who really understand about the stock market, how many investors who can read financial reports to analyses how are companies growing,” he said.
Companies’ provision of sufficient and accurate information for investors and the management ability of state bodies are also worried, he said.
Source: VNE
ACB banker distinguished
The Asian Banker has conferred "The Best Leader 2006 for Viet Nam" prize on the Asian Commercial Bank (ACB) CEO, Ly Xuan Hai, making him the only Vietnamese on a par with another top 14 financial executives in Asia.
The prestigious Asian financial institution has praised Hai's leadership as a key contribution to the ACB's fastest growth in Viet Nam, making it the most energetic bank in the region.
The bank has set a target of leading the joint stock commercial banks in Viet Nam with pre-tax profits to reach 1.5 trillion VND in 2007.
Its 2007 plan also calls for increasing the total asset to 65 trillion VND and disbursing over 25 trillion VND in loans.
Source: VNA
The prestigious Asian financial institution has praised Hai's leadership as a key contribution to the ACB's fastest growth in Viet Nam, making it the most energetic bank in the region.
The bank has set a target of leading the joint stock commercial banks in Viet Nam with pre-tax profits to reach 1.5 trillion VND in 2007.
Its 2007 plan also calls for increasing the total asset to 65 trillion VND and disbursing over 25 trillion VND in loans.
Source: VNA
FPT and Agribank sign partnership
The listed FPT will help the state-run bank improve its IT system as part of its long-term development strategy.
FPT will also consult Agribank in the lender’s equitization process which is set to start this year with the restructure of some affiliates.
The two sides will support each other in training human resources.
The tech giant is now considering a number of regional and world markets for listing, with the Singapore bourse viewed as the frontrunner.
KPMG will audit the books of FPT, certifying the financial reports of its three arms, five subsidiaries, one university, five training and trading centers, and any business that might be set up this year.
Agribank is among the country's largest lenders and reported that its assets rose 22.7% last year to VND233.9 trillion (14.5 billion US$).
Bad debt based on new, international accounting standards only accounted for 1.9% of its total loans.
Agribank, ordered by the government to go public in 2008 following similar moves by state-run Vietcombank and Mekong Delta Housing Bank this year, had aimed to keep the bad debt ratio at 5% in 2006.
Source: Thanh Nien
Tuesday, March 27, 2007
Commodity output figures for March
Coal production possibly rose 2% year-on-year to 3.67 million tons this month but its crude oil output is likely to have fallen 9.3% to 1.33 million tons, the Vietnamese government said.
Coal exports in March were estimated at 2.8 million tons valued at $86 million, up 4.8% and 59.3% respectively, the General Statistics Office (GSO) reported Monday.
Natural gas production is estimated at 740 million cubic meters in March, up 19.2%.
The GSO forecast a 23.9% fall in liquefied petroleum gas output to 23,900 tons this month.
Vietnam, Southeast Asia’s third largest crude oil exporter, is expected to have exported 1.28 million tons of crude this month, a 14.2% decrease, it said.
Imports of oil products in March are projected to have risen to 1 million tons valued at 483mio US$.
The country plans to reduce export of fossil fuels like crude oil and coal from 2008 to ensure sufficient supplies for oil refineries and energy-thirsty industries like electricity and cement.
Source: Thanh Nien
Coal exports in March were estimated at 2.8 million tons valued at $86 million, up 4.8% and 59.3% respectively, the General Statistics Office (GSO) reported Monday.
Natural gas production is estimated at 740 million cubic meters in March, up 19.2%.
The GSO forecast a 23.9% fall in liquefied petroleum gas output to 23,900 tons this month.
Vietnam, Southeast Asia’s third largest crude oil exporter, is expected to have exported 1.28 million tons of crude this month, a 14.2% decrease, it said.
Imports of oil products in March are projected to have risen to 1 million tons valued at 483mio US$.
The country plans to reduce export of fossil fuels like crude oil and coal from 2008 to ensure sufficient supplies for oil refineries and energy-thirsty industries like electricity and cement.
Source: Thanh Nien
State keeps full stake in some key sectors
The State will keep 100 percent of chartered capital of businesses involved in 19 key sectors, according to the latest decision signed by the Prime Minister.
They are businesses involved in production and supply of explosives, toxic chemicals, radioactive substances weapons, press and media, air traffic control, money printing and coin casting, and lottery.
The decision also defines sectors in which the State will take more than 50 percent of the capital of their businesses once equitised. They include businesses involved in the supply of public services and services that are indispensable to production development and to improving material and spiritual life of ethnic minority people in mountainous and remote areas.
Businesses which ensure economic balance and market stability, including money trading, insurance, oil and gas exploitation and processing, and supply of information and communication network infrastructure, are also among those with over 50 percent of share being held by the State after equitisation.
The classification will help accelerate the process of SOE equitisation and reorganisation towards increasing the intensive participation of many economic sectors and reducing the State's ownership and interference in businesses' operations.
The process of equitisation in industries has day by day demonstrated the policy with a sharp drop in the number of businesses with State holding controlling stocks.
The Ministry of Agriculture and Rural Development, for example, plans to equitise 39 SOEs this year with only three of them defined to have over 50 percent of share held by the State. They are the Central Major Animal Seed Production One-Member Co. Ltd, the Central Veterinary Medicine one-member Co. Ltd. No. 3 and the Coffee Appraising One-Member Co. Ltd.
According to Minister of Finance Vu Van Ninh, the equitisation process will be accelerated in the coming period, focusing on selling shares to domestic and foreign strategic investors.
The programme targets at equitising around 1,500 enterprises from now till 2010. This year, 550 enterprises will be equitised, including State-owned corporations, commercial banks and businesses involved in public-service and insurance.
According to the government's report to the National Assembly at its year-end session in 2006, since 2001, the number of equitised businesses has increased markedly. However, the equitisation process remains slowly with about 3,000 SOEs equitised since 1992.
Source: VNA
They are businesses involved in production and supply of explosives, toxic chemicals, radioactive substances weapons, press and media, air traffic control, money printing and coin casting, and lottery.
The decision also defines sectors in which the State will take more than 50 percent of the capital of their businesses once equitised. They include businesses involved in the supply of public services and services that are indispensable to production development and to improving material and spiritual life of ethnic minority people in mountainous and remote areas.
Businesses which ensure economic balance and market stability, including money trading, insurance, oil and gas exploitation and processing, and supply of information and communication network infrastructure, are also among those with over 50 percent of share being held by the State after equitisation.
The classification will help accelerate the process of SOE equitisation and reorganisation towards increasing the intensive participation of many economic sectors and reducing the State's ownership and interference in businesses' operations.
The process of equitisation in industries has day by day demonstrated the policy with a sharp drop in the number of businesses with State holding controlling stocks.
The Ministry of Agriculture and Rural Development, for example, plans to equitise 39 SOEs this year with only three of them defined to have over 50 percent of share held by the State. They are the Central Major Animal Seed Production One-Member Co. Ltd, the Central Veterinary Medicine one-member Co. Ltd. No. 3 and the Coffee Appraising One-Member Co. Ltd.
According to Minister of Finance Vu Van Ninh, the equitisation process will be accelerated in the coming period, focusing on selling shares to domestic and foreign strategic investors.
The programme targets at equitising around 1,500 enterprises from now till 2010. This year, 550 enterprises will be equitised, including State-owned corporations, commercial banks and businesses involved in public-service and insurance.
According to the government's report to the National Assembly at its year-end session in 2006, since 2001, the number of equitised businesses has increased markedly. However, the equitisation process remains slowly with about 3,000 SOEs equitised since 1992.
Source: VNA
Navigos IPO by 2010
Vietnam's leading human resource services provider Navigos Group has unveiled a plan to list on the local bourse by launching an initial public offering (IPO) by 2010 at the latest.
Jonah Levey, chief executive officer and founder of Navigos Group, said that an IPO would accelerate the company's growth as well as allow more investors to participate in the high growth potential in the human resource services sector in Vietnam.
Navigos Group, which is also the owner of Vietnam's popular job website VietnamWorks.com, has is-sued more than 10 million shares and plans to raise the number to 13 million to find more funds for business expansion.
"Demand for our services will continue to increase, and we can leverage our scale, track record and depth of knowledge to create better services for our clients. We continue to strengthen our leading position in the industry through our level of resource and reach into the top of talent pool," Levey said.
The investment community has shown interest in Navigos.
The institutional investor Indochina Capital acquired a 20% stake in the company in mid-2006 and since then the company's value has more than doubled as its share price has leapt from just US$0.01 to US$2.50 per share.
Levey credited the company's value increase to solid business performance and Vietnam's upbeat prospects. Navigos Group reports strong 2006 results and this is the fourth consecutive year the company has achieved a growth rate of over 100 percent in revenue.
Levey explained that revenue growth reflected the job creation boom in Vietnam.
"Over l00,000 people got a job through VietnamWorks.com and Navigos Group in 2006 and we expect the number will increase by four times this year," he said.
Source: Thanh Nien
Jonah Levey, chief executive officer and founder of Navigos Group, said that an IPO would accelerate the company's growth as well as allow more investors to participate in the high growth potential in the human resource services sector in Vietnam.
Navigos Group, which is also the owner of Vietnam's popular job website VietnamWorks.com, has is-sued more than 10 million shares and plans to raise the number to 13 million to find more funds for business expansion.
"Demand for our services will continue to increase, and we can leverage our scale, track record and depth of knowledge to create better services for our clients. We continue to strengthen our leading position in the industry through our level of resource and reach into the top of talent pool," Levey said.
The investment community has shown interest in Navigos.
The institutional investor Indochina Capital acquired a 20% stake in the company in mid-2006 and since then the company's value has more than doubled as its share price has leapt from just US$0.01 to US$2.50 per share.
Levey credited the company's value increase to solid business performance and Vietnam's upbeat prospects. Navigos Group reports strong 2006 results and this is the fourth consecutive year the company has achieved a growth rate of over 100 percent in revenue.
Levey explained that revenue growth reflected the job creation boom in Vietnam.
"Over l00,000 people got a job through VietnamWorks.com and Navigos Group in 2006 and we expect the number will increase by four times this year," he said.
Source: Thanh Nien
State Bank of Vietnam sells treasury bills
The State Bank of Vietnam sold all of an offered VND700 billion (43.7 million US$) in one-year treasury bills at an auction.
The central bank sold the debt Monday to one commercial bank that attended the session at an annual interest rate of 3.74 percent, the executive said without naming the bank.
The central bank last sold VND700 billion of one-year paper to three commercial banks at an annual yield of 3.85% on March 12.
Source: Thanh Nien
Vinamilk starts brewery joint venture
A brewery with an annual production capacity of 100 million litres was inaugurated at the My Phuoc Industrial Zone No.2 in southern Binh Duong province on Mar. 26.
The joint venture between the Viet Nam Dairy Products Joint Stock Company (Vinamilk) and London-based SABMiller, the world's second largest brewer, will have an initial production capacity of 50 million litres per year.
The SABMiller Viet Nam, whose construction commenced in March 2006, was installed with a state-of-the-art production line from Germany under the supervision of more than one hundred European experts.
Under the deal between the two companies, Vinamilk and SABMiller each hold 50% interest in the 45mio US$ project.
Products of the joint venture, bearing the Zorok trademark, will take advantage of the extensive distribution network of Vinamilk, the market leader in milk and related products of Viet Nam with 75% market share, and the SABMiller's distribution network in more than 60 countries.
The joint venture between the Viet Nam Dairy Products Joint Stock Company (Vinamilk) and London-based SABMiller, the world's second largest brewer, will have an initial production capacity of 50 million litres per year.
The SABMiller Viet Nam, whose construction commenced in March 2006, was installed with a state-of-the-art production line from Germany under the supervision of more than one hundred European experts.
Under the deal between the two companies, Vinamilk and SABMiller each hold 50% interest in the 45mio US$ project.
Products of the joint venture, bearing the Zorok trademark, will take advantage of the extensive distribution network of Vinamilk, the market leader in milk and related products of Viet Nam with 75% market share, and the SABMiller's distribution network in more than 60 countries.
GDP growth hits record in first quarter
The country's gross domestic product (GDP) in the first quarter of the year is estimated to hit 7.7%, the highest level since 2001. GDP of 7.3% in the same period of 2005 was the highest previously.
The achievement is attributed to high growth rates of key economic sectors. Noteworthy are agro, forestry and fisheries (2.3%) and industry and construction (9.3%).
Industrial production value is estimated at 130 trillion VND (8.1 billion US$), a year-on-year increase of 16.6%.
Export turnover is estimated to reach 10.48 billion US$, 18% increase year-on-year. Crude oil still makes the largest contributions to the total export value, but decreases 14.6% in compared to the same period last year.
March consumer price index decreases 0.22%, pulling the figure of three months to a growth rate of 3.02%.
Source: VNA
The achievement is attributed to high growth rates of key economic sectors. Noteworthy are agro, forestry and fisheries (2.3%) and industry and construction (9.3%).
Industrial production value is estimated at 130 trillion VND (8.1 billion US$), a year-on-year increase of 16.6%.
Export turnover is estimated to reach 10.48 billion US$, 18% increase year-on-year. Crude oil still makes the largest contributions to the total export value, but decreases 14.6% in compared to the same period last year.
March consumer price index decreases 0.22%, pulling the figure of three months to a growth rate of 3.02%.
Source: VNA
Monday, March 26, 2007
Credit Suisse receives securities trading code
Vietnam’s stock market is becoming more and more attractive to foreign investors after Switzerland’s Credit Suisse, one of the world’s leading banks, became the latest foreign investor to join the market.
Lito Camacho, vice chairman of Credit Suisse Asia Pacific, said his bank received a securities trading code certificate from the Vietnam State Securities Commission (SSC) last week enabling it to trade equities, government and corporate bonds in Vietnam.
“We are delighted to have obtained a trading code to buy and sell domestic securities in Vietnam. This move further underpins Credit Suisse’s commitment to Vietnam,” Camacho said.
Credit Suisse’s Investment Banking business has appointed Saigon Securities Incorporation as its local broker for equities and ACB Securities Company for fixed income products, while its asset management business appointed Vietcombank Securities Company as the local broker.
Credit Suisse is among many foreign banks, financial institutions and investment funds to receive the certificate to trade domestic equities in Vietnam.
Every foreign investor wanting to trade securities on Vietnam’s Hanoi and Ho Chi Minh stock exchanges is required to obtain an SSC securities trading code.
Morgan Stanley, Vietnam Holdings and Merrill Lynch have already joined the market in Vietnam. Meanwhile, VinaCapital and Dragon Capital have pushed to set up additional investment funds to raise foreign capital.
Other foreign invested fund management companies, such as Hong Kong based- Nomura International, Singapore’s Blackhorse Asset Management Pte Ltd. and Korean Mirae Asset Maps Investment Management Co., Ltd, have set up representative offices in the country as well.
Vietnam’s stock market is predicted to attract a large influx of investment from global investors following the country’s entry into the World Trade Organization. There are now around 20 foreign invested funds with total capital of over $2 billion in Vietnam, according to the SSC.
Source: VEN
Lito Camacho, vice chairman of Credit Suisse Asia Pacific, said his bank received a securities trading code certificate from the Vietnam State Securities Commission (SSC) last week enabling it to trade equities, government and corporate bonds in Vietnam.
“We are delighted to have obtained a trading code to buy and sell domestic securities in Vietnam. This move further underpins Credit Suisse’s commitment to Vietnam,” Camacho said.
Credit Suisse’s Investment Banking business has appointed Saigon Securities Incorporation as its local broker for equities and ACB Securities Company for fixed income products, while its asset management business appointed Vietcombank Securities Company as the local broker.
Credit Suisse is among many foreign banks, financial institutions and investment funds to receive the certificate to trade domestic equities in Vietnam.
Every foreign investor wanting to trade securities on Vietnam’s Hanoi and Ho Chi Minh stock exchanges is required to obtain an SSC securities trading code.
Morgan Stanley, Vietnam Holdings and Merrill Lynch have already joined the market in Vietnam. Meanwhile, VinaCapital and Dragon Capital have pushed to set up additional investment funds to raise foreign capital.
Other foreign invested fund management companies, such as Hong Kong based- Nomura International, Singapore’s Blackhorse Asset Management Pte Ltd. and Korean Mirae Asset Maps Investment Management Co., Ltd, have set up representative offices in the country as well.
Vietnam’s stock market is predicted to attract a large influx of investment from global investors following the country’s entry into the World Trade Organization. There are now around 20 foreign invested funds with total capital of over $2 billion in Vietnam, according to the SSC.
Source: VEN
Nagakawa to list at Vietnamese stock market
The Japanese-invested electronic home appliance manufacturer, Nagakawa Vietnam, said it will increase its chartered capital this year and will join the stock market in 2008.
Nagakawa Vietnam will increase its chartered capital to 200 billion VND this year and to 1 trillion VND by 2010 to implement its project to build the Nagakawa Plaza in Ha Noi, General Director Nguyen Duc Kha said at a ceremony on Mar. 24 marking the company's five-year establishment.
Accordingly, Nagakawa Viet Nam will diversify its range of products and expand its markets to northern and Latin America alongside prioritising investment in finance and real estate .
Nagakawa Vietnam was established in 2002 as a joint venture between the Anh Vu International Economy Development Company and Japan’s Wako Group.
On Mar. 21, it completed the equitisation and became a joint stock company.
Its main products are air conditioners, fridges, washing machines, microwave ovens and vacuum cleaners.
Source: VNA
Nagakawa Vietnam will increase its chartered capital to 200 billion VND this year and to 1 trillion VND by 2010 to implement its project to build the Nagakawa Plaza in Ha Noi, General Director Nguyen Duc Kha said at a ceremony on Mar. 24 marking the company's five-year establishment.
Accordingly, Nagakawa Viet Nam will diversify its range of products and expand its markets to northern and Latin America alongside prioritising investment in finance and real estate .
Nagakawa Vietnam was established in 2002 as a joint venture between the Anh Vu International Economy Development Company and Japan’s Wako Group.
On Mar. 21, it completed the equitisation and became a joint stock company.
Its main products are air conditioners, fridges, washing machines, microwave ovens and vacuum cleaners.
Source: VNA
Sunday, March 25, 2007
Draft on equitising SOEs
The rapid growth in the stock market over the last few years may become even more frantic as the Government drafts a new policy on equitising large-scale State-owned enterprises (SOEs).
Lawmarkers are in the process of drafting a new decree to replace Decision 155/2004/QD-TTg, which thus far has focussed on equiptising smaller SOEs that do not control large chunks of State capital. The shift in focus to larger companies, especially those that are or plan to become private limited companies, could create a frenzy on the country’s two stock markets, says analysts.
Tran Tien Cuong, head of the Central Institute for Economic Management’s Enterprise Renewal and Research Board, says abolishing regulaltions on the size of SOEs that are eligible for equitisation is a great breakthrough for the securities market.
The prospect of larger State companies listing shares in the near future could make the market in general more attractive to investors, say analysts, especially considering officials are contemplating whether to loosen controls on certain sectors that control vital assets, like telecommunications.
The State, though, will continue to hold controlling shares in these SOEs, says Cuong.
According to the board assigned to draft the new SOE decree, easing controls on the telecommunications sector is due to regulations by the Ministry of Post and Telematics and international commitments, namely those under the World Trade Organisation agreement.
Analysts, though, are concerned that SOEs in the public service sector will not attract investors, due to poor financial results.
Cuong says there have been difficulties with public service sector enterprises as well as with their equiptisation processes.
If the State does not find a solution, there is a slim possibility the companies will be able to stablise their business activities and services, he says.
Lawmarkers are in the process of drafting a new decree to replace Decision 155/2004/QD-TTg, which thus far has focussed on equiptising smaller SOEs that do not control large chunks of State capital. The shift in focus to larger companies, especially those that are or plan to become private limited companies, could create a frenzy on the country’s two stock markets, says analysts.
Tran Tien Cuong, head of the Central Institute for Economic Management’s Enterprise Renewal and Research Board, says abolishing regulaltions on the size of SOEs that are eligible for equitisation is a great breakthrough for the securities market.
The prospect of larger State companies listing shares in the near future could make the market in general more attractive to investors, say analysts, especially considering officials are contemplating whether to loosen controls on certain sectors that control vital assets, like telecommunications.
The State, though, will continue to hold controlling shares in these SOEs, says Cuong.
According to the board assigned to draft the new SOE decree, easing controls on the telecommunications sector is due to regulations by the Ministry of Post and Telematics and international commitments, namely those under the World Trade Organisation agreement.
Analysts, though, are concerned that SOEs in the public service sector will not attract investors, due to poor financial results.
Cuong says there have been difficulties with public service sector enterprises as well as with their equiptisation processes.
If the State does not find a solution, there is a slim possibility the companies will be able to stablise their business activities and services, he says.
Saturday, March 24, 2007
Incombank shares to go to bourse
Next week, the Vietnam Industrial and Commercial Bank (Incombank) will give bidding documents to a restricted number of bidders under the agreement of the Prime Minister, said the bank’s General Director Pham Huy Hung.
According to Mr Hung, Incombank plans to conduct initial public offering (IPO) in the fourth quarter of 2007 and list its shares on the stock market.
Seven of ten international bidders have been selected for the limited tender, which is scheduled to last till May 2007.
Incombank is speeding up its preparations for equitisation to become one of the first state-owned commercial banks to perform IPO and list shares on the stock market.
Incombank and Australia’s onQ on March 21 signed an agreement to issue the first pre-paid Visa cards in Vietnam, called Bopo. This kind of card works like a Visa credit card, allowing card owners to purchase goods, withdraw money from ATMs, and pay online.
Incombank plans to issue this kind of card in the third quarter of 2007; firstly, the pre-paid tourist Bopo to serve tourists.
Source: VNE
According to Mr Hung, Incombank plans to conduct initial public offering (IPO) in the fourth quarter of 2007 and list its shares on the stock market.
Seven of ten international bidders have been selected for the limited tender, which is scheduled to last till May 2007.
Incombank is speeding up its preparations for equitisation to become one of the first state-owned commercial banks to perform IPO and list shares on the stock market.
Incombank and Australia’s onQ on March 21 signed an agreement to issue the first pre-paid Visa cards in Vietnam, called Bopo. This kind of card works like a Visa credit card, allowing card owners to purchase goods, withdraw money from ATMs, and pay online.
Incombank plans to issue this kind of card in the third quarter of 2007; firstly, the pre-paid tourist Bopo to serve tourists.
Source: VNE
Quantas to buy stake of Pacific Airlines
he State Capital Investment Corporation (SCIC) and the Australian Qantas are in the final stage of negotiations to sell the state owned shares in Pacific Airlines to the Australian air carrier, a source from SCIC said.The source said that the official contract on the sale of the stakes will be inked at the end of March or in the first quarter of April at the latest.
The source has declined to reveal the value of the contract and how many percentages the second biggest Australian air carrier will hold, however, he said that SCIC would retain the controlling stakes in Pacific Airlines.
The Australian air carrier began negotiating to buy a proportion of Pacific Airlines' shares in January 2007, which has been valued at 167mio Us$. It is said that Pacific Airlines would sell 30% of its shares to foreign investors, however, the figure has not been confirmed.
In addition to selling shares in Pacific Airlines, SCIC is also considering selling shares in other enterprises to which it makes capital contribution in order to provide more 'commodities' to the stock market.
In an interview given to the press agencies recently, Le Song Lai, Deputy Director General of SCIC said that in 2007, SCIC would have 22 more companies listed on the stock market.
In 2007, SCIC plans to withdraw VND227bil (14.18mio Us$) worth of capital from 50 enterprises. The majority of them are small enterprises which do not operate in important fields.
Source: VNE
The source has declined to reveal the value of the contract and how many percentages the second biggest Australian air carrier will hold, however, he said that SCIC would retain the controlling stakes in Pacific Airlines.
The Australian air carrier began negotiating to buy a proportion of Pacific Airlines' shares in January 2007, which has been valued at 167mio Us$. It is said that Pacific Airlines would sell 30% of its shares to foreign investors, however, the figure has not been confirmed.
In addition to selling shares in Pacific Airlines, SCIC is also considering selling shares in other enterprises to which it makes capital contribution in order to provide more 'commodities' to the stock market.
In an interview given to the press agencies recently, Le Song Lai, Deputy Director General of SCIC said that in 2007, SCIC would have 22 more companies listed on the stock market.
In 2007, SCIC plans to withdraw VND227bil (14.18mio Us$) worth of capital from 50 enterprises. The majority of them are small enterprises which do not operate in important fields.
Source: VNE
Indochina Capital to build recreational projects
A London-listed Indochina Capital affiliate has obtained two licenses to develop recreation projects at a total cost of US$118 million in central Danang city and Quang Nam Province.
On Friday, Danang authorities granted the investment certificate to Indochina Land Holdings (ILH) to develop an $80 million tourism complex in the coastal Ngu Hanh Son District.
The five-star coastal tourism complex covering 20ha-site will comprise of a 250-room hotel, a high-end 150-apartment block, a 40-villa area along with shopping malls and other recreation services.
Construction of the complex is expected to start by late this year and to complete in mid-2009.
Also yesterday, ILH received a license from the Quang Nam government to build a $38 million golf course in Dien Ban District.
The 18-hole golf course will be tailored and built by two US leading companies in golf recreation, Colin Montgomerie and IMG.
The frametime of the project was not given.
The company has now gone ahead with plans to set up a joint venture with a local company in Danang city to develop a wharf-commercial-tourism complex at an estimated cost of $25 million.
The complex will comprise of villas and high-end apartments along side Son Tra – Dien Ngoc beach for rent or sale, along with shopping malls and other facilities.
The ILH-invested $27 million Indochina River Towers comprising office-building, apartments and shopping mall is expected to finish early next year.
The Riverside Mall, a part of the Indochina River Towers project at Bach Dang Street, is set to open in November.
The three-story 6,600 sq.m facility will house clothing, cosmetics, footwear, home appliances and food retailers in some of the most expensive retail store space in the central region.
The tenant’s monthly rental cost will range from $15 to $55 per sq.m in the luxury shopping mall.
The parent company of ILH, Indochina Capital recently set up Indochina Capital Vietnam Holdings, valued at $500 million, listed with the ticker symbol ICV on the London Stock Exchange earlier this month.
Indochina Capital Vietnam Holdings, which is structured as a closed-end investment company, isn’t just investing in equities listed on the Ho Chi Minh stock exchange and over-the-counter stocks.
It will also look at private equity and potentially some derivatives and debt securities. And it can also invest in non-Vietnamese companies which have a material portion of their business or assets in Vietnam.
Source: Thanh Nien
On Friday, Danang authorities granted the investment certificate to Indochina Land Holdings (ILH) to develop an $80 million tourism complex in the coastal Ngu Hanh Son District.
The five-star coastal tourism complex covering 20ha-site will comprise of a 250-room hotel, a high-end 150-apartment block, a 40-villa area along with shopping malls and other recreation services.
Construction of the complex is expected to start by late this year and to complete in mid-2009.
Also yesterday, ILH received a license from the Quang Nam government to build a $38 million golf course in Dien Ban District.
The 18-hole golf course will be tailored and built by two US leading companies in golf recreation, Colin Montgomerie and IMG.
The frametime of the project was not given.
The company has now gone ahead with plans to set up a joint venture with a local company in Danang city to develop a wharf-commercial-tourism complex at an estimated cost of $25 million.
The complex will comprise of villas and high-end apartments along side Son Tra – Dien Ngoc beach for rent or sale, along with shopping malls and other facilities.
The ILH-invested $27 million Indochina River Towers comprising office-building, apartments and shopping mall is expected to finish early next year.
The Riverside Mall, a part of the Indochina River Towers project at Bach Dang Street, is set to open in November.
The three-story 6,600 sq.m facility will house clothing, cosmetics, footwear, home appliances and food retailers in some of the most expensive retail store space in the central region.
The tenant’s monthly rental cost will range from $15 to $55 per sq.m in the luxury shopping mall.
The parent company of ILH, Indochina Capital recently set up Indochina Capital Vietnam Holdings, valued at $500 million, listed with the ticker symbol ICV on the London Stock Exchange earlier this month.
Indochina Capital Vietnam Holdings, which is structured as a closed-end investment company, isn’t just investing in equities listed on the Ho Chi Minh stock exchange and over-the-counter stocks.
It will also look at private equity and potentially some derivatives and debt securities. And it can also invest in non-Vietnamese companies which have a material portion of their business or assets in Vietnam.
Source: Thanh Nien
Friday, March 23, 2007
Vietnam's FDI exceeds 2.5 billion US$
Viet Nam has in the first quarter of this year attracted more than 2.5 billion USD in foreign direct investment (FDI), a year-on-year increase of 22%, reported the Ministry of Planning and Investment.
According to the Foreign Investment Department, in March alone, the country licensed 71 FDI projects with a combined registered capital of 455 million USD and permitted 47 operational projects which added 432 million USD to their investment capital.
Up to 49% of the total capital of the first three months was poured into the service industry, 48% into industrial projects, and the remainder into the agro-forestry-fisheries sector.
The Republic of Korea emerged as the biggest investor in Viet Nam in the reviewed period with a total registered capital of 486 million USD, followed by Singapore with 476 million USD.
According to the department, the largest projects involve the construction of a 276 million USD resort in central Thua Thien-Hue province, a 220 million USD paper mill in southern Binh Duong province, a 165 million USD seaport in southern Ba Ria-Vung Tau province and a 100 million USD reservoir in northern Thai Nguyen province.
Source: VNA
According to the Foreign Investment Department, in March alone, the country licensed 71 FDI projects with a combined registered capital of 455 million USD and permitted 47 operational projects which added 432 million USD to their investment capital.
Up to 49% of the total capital of the first three months was poured into the service industry, 48% into industrial projects, and the remainder into the agro-forestry-fisheries sector.
The Republic of Korea emerged as the biggest investor in Viet Nam in the reviewed period with a total registered capital of 486 million USD, followed by Singapore with 476 million USD.
According to the department, the largest projects involve the construction of a 276 million USD resort in central Thua Thien-Hue province, a 220 million USD paper mill in southern Binh Duong province, a 165 million USD seaport in southern Ba Ria-Vung Tau province and a 100 million USD reservoir in northern Thai Nguyen province.
Source: VNA
Vietnam should sell more dollar debt: foreign fund managers
Vietnam should ease curbs on issue of foreign currency bonds to tap investor demand and cut funding costs, foreign fund managers have said.
Pacific Investment Management Co. and HSBC Holdings Plc. said the government needed to raise money to build power stations and roads as it targeted annual economic growth of 8.5% through the end of the decade.
The country of 85 million people has raised just 750 million US$ from a single issue of foreign currency bonds.
“Unfortunately there are processes you need to go through here to get to the point where you can issue bonds,'' Brian Baker, chief executive officer of Pimco Asia Ltd., told an interviewer on the sidelines of a Euromoney conference in Hanoi. “You've got a very attractive external market now.''
Two months after selling the country's first dollar- denominated security in October 2005, the government put in place regulations requiring companies to seek approval for issuing international bonds.
A pipeline of sales is starting to emerge and Vietnamese companies will sell at least $5 billion worth debt in the next decade, according to Jean-Pierre Bernard, head of Southeast Asia and India at BNP Paribas SA.
Electricity of Vietnam, the nation's monopoly power distributor, has got government approval to raise 500 million US$ from an overseas bond issue next year.
Vietnam Oil & Gas Group, a state-owned monopoly, said in January it might issue a foreign currency bond next year to build the country's second oil refinery. Vietnam Airlines Corp. said in December it was considering an international bond issue.
The existing 6.875% dollar bonds, maturing in January 2016, were sold to raise funds for the state-owned Vietnam Shipbuilding Industry Corp.’s projects including building shipyards in Haiphong city and neighboring Quang Ninh province.
The issue, managed by Credit Suisse Group, was more than six times oversubscribed.
“We did not get as much as we wanted,'' said Baker from the German-owned Pimco, which had $610.5 billion in assets at the end of March. “We would love to look at some other issues, especially from the government.''
The bonds have rallied to yield 1.25% age points more than similar-maturity U.S. treasuries, narrowing from 2.51%age points in June last year, according to Merrill Lynch & Co. The yield is 5.78%, compared with 5.95% for similar-maturity securities sold by Brazil's government, which has the same BB rating as Vietnam from Standard & Poor's.
Pension and life insurance investors as well as hedge funds are looking for investments globally as central banks have stopped increasing interest rates and on speculation the US Federal Reserve will lower borrowing costs as early as June.
“We know there is a lot of money out there, and that many foreign investors are willing to invest in Vietnam now,'' said Nguyen Thanh Do, head of external financing at Vietnam’s Ministry of Finance.
“But our biggest concern is to make sure that the proceeds [of bond issues] will be used in the most efficient way, and more importantly, to ensure our repayment ability.''
Companies needed to prove project feasibility and repayment ability and that funds would be used immediately, Nguyen said.
Money supply in the world's top economies is growing at an annual rate of 7.5%, according to estimates by Charles Dumas, managing director of Lombard Street Research Ltd. in London.
Vietnam's government “could raise billions of dollars in the international markets if it really wanted to,'' said Joshua Matthews, head of Vietnam debt capital markets at HSBC in Hong Kong. “There's just too much foreign money chasing too little debt.''
The Vietnamese dong has gained 0.3% this year to 16,014 per dollar. The Ho Chi Minh City Securities Trading Center's VN Index of stocks has gained 48% in 2007.
Vietnam, Southeast Asia's third most populous nation, may need to spend as much as $80 billion by 2025 on power generation, transmission, and distribution to prevent electricity shortages, Van Huong, director-general of the Ministry of Industry’s Department of Energy and Petroleum, said.
Baker said: “There are clearly needs down the road for growth and infrastructure development.''
Pimco's 97 billion US$ Total Return Fund is the largest mutual bond fund in the world. The company is a unit of Munich-based Allianz SE.
Demand for Vietnam's debt may improve further on expectations of higher credit ratings. S&P raised Vietnam's credit rating last year to two levels below investment grade, and Moody's Investors Service said last week it might increase the rating from Ba3, one level lower than S&P.
“There's a huge amount of money sloshing around in the world,'' Steve Targett, Melbourne-based head of institutional banking at Australia & New Zealand Banking Group Ltd., which opened a branch in Vietnam in 1993, said in an interview. “You'd think that regular issues of bonds would be sensible."
Source: Thanh Nien
Pacific Investment Management Co. and HSBC Holdings Plc. said the government needed to raise money to build power stations and roads as it targeted annual economic growth of 8.5% through the end of the decade.
The country of 85 million people has raised just 750 million US$ from a single issue of foreign currency bonds.
“Unfortunately there are processes you need to go through here to get to the point where you can issue bonds,'' Brian Baker, chief executive officer of Pimco Asia Ltd., told an interviewer on the sidelines of a Euromoney conference in Hanoi. “You've got a very attractive external market now.''
Two months after selling the country's first dollar- denominated security in October 2005, the government put in place regulations requiring companies to seek approval for issuing international bonds.
A pipeline of sales is starting to emerge and Vietnamese companies will sell at least $5 billion worth debt in the next decade, according to Jean-Pierre Bernard, head of Southeast Asia and India at BNP Paribas SA.
Electricity of Vietnam, the nation's monopoly power distributor, has got government approval to raise 500 million US$ from an overseas bond issue next year.
Vietnam Oil & Gas Group, a state-owned monopoly, said in January it might issue a foreign currency bond next year to build the country's second oil refinery. Vietnam Airlines Corp. said in December it was considering an international bond issue.
The existing 6.875% dollar bonds, maturing in January 2016, were sold to raise funds for the state-owned Vietnam Shipbuilding Industry Corp.’s projects including building shipyards in Haiphong city and neighboring Quang Ninh province.
The issue, managed by Credit Suisse Group, was more than six times oversubscribed.
“We did not get as much as we wanted,'' said Baker from the German-owned Pimco, which had $610.5 billion in assets at the end of March. “We would love to look at some other issues, especially from the government.''
The bonds have rallied to yield 1.25% age points more than similar-maturity U.S. treasuries, narrowing from 2.51%age points in June last year, according to Merrill Lynch & Co. The yield is 5.78%, compared with 5.95% for similar-maturity securities sold by Brazil's government, which has the same BB rating as Vietnam from Standard & Poor's.
Pension and life insurance investors as well as hedge funds are looking for investments globally as central banks have stopped increasing interest rates and on speculation the US Federal Reserve will lower borrowing costs as early as June.
“We know there is a lot of money out there, and that many foreign investors are willing to invest in Vietnam now,'' said Nguyen Thanh Do, head of external financing at Vietnam’s Ministry of Finance.
“But our biggest concern is to make sure that the proceeds [of bond issues] will be used in the most efficient way, and more importantly, to ensure our repayment ability.''
Companies needed to prove project feasibility and repayment ability and that funds would be used immediately, Nguyen said.
Money supply in the world's top economies is growing at an annual rate of 7.5%, according to estimates by Charles Dumas, managing director of Lombard Street Research Ltd. in London.
Vietnam's government “could raise billions of dollars in the international markets if it really wanted to,'' said Joshua Matthews, head of Vietnam debt capital markets at HSBC in Hong Kong. “There's just too much foreign money chasing too little debt.''
The Vietnamese dong has gained 0.3% this year to 16,014 per dollar. The Ho Chi Minh City Securities Trading Center's VN Index of stocks has gained 48% in 2007.
Vietnam, Southeast Asia's third most populous nation, may need to spend as much as $80 billion by 2025 on power generation, transmission, and distribution to prevent electricity shortages, Van Huong, director-general of the Ministry of Industry’s Department of Energy and Petroleum, said.
Baker said: “There are clearly needs down the road for growth and infrastructure development.''
Pimco's 97 billion US$ Total Return Fund is the largest mutual bond fund in the world. The company is a unit of Munich-based Allianz SE.
Demand for Vietnam's debt may improve further on expectations of higher credit ratings. S&P raised Vietnam's credit rating last year to two levels below investment grade, and Moody's Investors Service said last week it might increase the rating from Ba3, one level lower than S&P.
“There's a huge amount of money sloshing around in the world,'' Steve Targett, Melbourne-based head of institutional banking at Australia & New Zealand Banking Group Ltd., which opened a branch in Vietnam in 1993, said in an interview. “You'd think that regular issues of bonds would be sensible."
Source: Thanh Nien
Thursday, March 22, 2007
New oil field discovered off southern coast
The Thang Long Joint Operating Company (JOC) has struck oil at what it believes is a productive well in the Cuu Long Basin off southern Ba Ria – Vung Tau Province, the firm announced yesterday.
Well drilling tests were positive to a depth of between 2,640 and 2,700 meters, tested at an estimated rate of 5,000 barrels of oil per day (bopd).
Thang Long JOC said it would negotiate with the Hoang Long JOC for joint exploration of the field.
This was the second successful drilling well for Thang Long in that area this year, after the operator had announced significant oil rates found at the Hai Su Trang (HST) earlier this year.
The Thang Long Joint Operating Company was formed in 2005 between Talisman Vietnam, a wholly owned subsidiary of Canadian Talisman Energy Inc and PetroVietnam Exploration and Production Company (PVEP) to conduct all operations on that block.
Talisman holds a 60% working interest share in any commercial discoveries on the block with PetroVietnam affiliate PVEP holding the remaining 40 percent%.
Source: Thanh Nien
Well drilling tests were positive to a depth of between 2,640 and 2,700 meters, tested at an estimated rate of 5,000 barrels of oil per day (bopd).
Thang Long JOC said it would negotiate with the Hoang Long JOC for joint exploration of the field.
This was the second successful drilling well for Thang Long in that area this year, after the operator had announced significant oil rates found at the Hai Su Trang (HST) earlier this year.
The Thang Long Joint Operating Company was formed in 2005 between Talisman Vietnam, a wholly owned subsidiary of Canadian Talisman Energy Inc and PetroVietnam Exploration and Production Company (PVEP) to conduct all operations on that block.
Talisman holds a 60% working interest share in any commercial discoveries on the block with PetroVietnam affiliate PVEP holding the remaining 40 percent%.
Source: Thanh Nien
Hard competition from China for Vietnamese steel industry
Vietnam, which has been importing semifinished steel billet from China, could soon import finished steel from that country to make up a massive shortfall in billets that has sent production costs skyrocketing.
With domestic plants meeting only 50 percent of demand for semifinished steel of around four million tons per year, Vietnam imports large quantities from China. But China plans to increase billet prices to 500 US$ per ton soon.
If that happens Vietnamese steelmakers fear that steel prices will go over VND10 million (624 US$) per ton after having spiked to VND9.3 million last January from VND8.3 million earlier.
The Vietnam-based Italia Steel Company is already planning to buy 5,000 tons of finished steel from China.
But there is an outcry from Vietnamese steelmakers.
Hoang Anh Dung, marketing manager of the Vietnam Steel Company, warned the move would have grave consequences on the domestic steel industry and cause unhealthy competition.
He also expressed a fear that the Vietnamese steel industry could be gobbled up by its Chinese counterpart if more steel companies opted to import from China.
Dung also warned about the poor quality of steel products of dubious origin imported from China.
Source: Thanh Nien
With domestic plants meeting only 50 percent of demand for semifinished steel of around four million tons per year, Vietnam imports large quantities from China. But China plans to increase billet prices to 500 US$ per ton soon.
If that happens Vietnamese steelmakers fear that steel prices will go over VND10 million (624 US$) per ton after having spiked to VND9.3 million last January from VND8.3 million earlier.
The Vietnam-based Italia Steel Company is already planning to buy 5,000 tons of finished steel from China.
But there is an outcry from Vietnamese steelmakers.
Hoang Anh Dung, marketing manager of the Vietnam Steel Company, warned the move would have grave consequences on the domestic steel industry and cause unhealthy competition.
He also expressed a fear that the Vietnamese steel industry could be gobbled up by its Chinese counterpart if more steel companies opted to import from China.
Dung also warned about the poor quality of steel products of dubious origin imported from China.
Source: Thanh Nien
EVN set for Eurobond issue
Electricity of Vietnam (EVN) is set to issue overseas corporate bonds next year, expecting to raise 300mio to 500mio US$ off the first phase, said an executive of the utility.
The bonds would be sold on international markets to raise funds for giant power plants, Dinh Quang Tri, deputy general director said.
Although a timeframe for the issue was not announced, Tri added that the government had already approved the issue in principle.
The Hanoi-based utility, which dominates the electricity industry in booming Vietnam, was in the process of choosing a foreign consultant to audit and establish a credit rating for the company.
If the process runs as scheduled, EVN would be the country’s first issuer of overseas corporate bonds.
Along with preparation for the forthcoming issue of overseas corporate bonds, the group planned to issue VND8 trillion (502mio US$) worth of bonds in the second quarter of this year for infrastructure development.
Unlisted EVN had raised VND6 trillion (377mio US$) from domestic bonds last year, saying the proceeds went to the construction of major power plants, such as the 2.3 billion US$ Son La hydro power plant.
The group needs VND250 trillion (15.6 billion US$) for the 2006-2010 period to build power plants.
EVN has submitted a new plan to the government that states all affiliates would go public by the end of 2008, two years earlier than planned.
The move was promoted by recent successful shares auctions of select EVN subsidies on the local securities market, according to Tri.
Power demand in Vietnam's economy, the world's fastest growing one after China, is forecast to grow up to 17% per year, prompting the government to plan 60 additional plants by 2020.
Source: Thanh Nien
The bonds would be sold on international markets to raise funds for giant power plants, Dinh Quang Tri, deputy general director said.
Although a timeframe for the issue was not announced, Tri added that the government had already approved the issue in principle.
The Hanoi-based utility, which dominates the electricity industry in booming Vietnam, was in the process of choosing a foreign consultant to audit and establish a credit rating for the company.
If the process runs as scheduled, EVN would be the country’s first issuer of overseas corporate bonds.
Along with preparation for the forthcoming issue of overseas corporate bonds, the group planned to issue VND8 trillion (502mio US$) worth of bonds in the second quarter of this year for infrastructure development.
Unlisted EVN had raised VND6 trillion (377mio US$) from domestic bonds last year, saying the proceeds went to the construction of major power plants, such as the 2.3 billion US$ Son La hydro power plant.
The group needs VND250 trillion (15.6 billion US$) for the 2006-2010 period to build power plants.
EVN has submitted a new plan to the government that states all affiliates would go public by the end of 2008, two years earlier than planned.
The move was promoted by recent successful shares auctions of select EVN subsidies on the local securities market, according to Tri.
Power demand in Vietnam's economy, the world's fastest growing one after China, is forecast to grow up to 17% per year, prompting the government to plan 60 additional plants by 2020.
Source: Thanh Nien
Foreign banks to be licensed in line with WTO commitments
The Prime Minister has urged the State Bank of Viet Nam (SBV) to license World Trade Organisation member countries' banks operating in Viet Nam in line with governmental regulations and the country's international commitments.
Foreign banks are allowed to open representative offices, set up joint ventures or wholly foreign-owned banks in Viet Nam or buy shares from local joint-stock commercial banks.
Under a dispatch sent by the Government Office on Mar. 20, PM Nguyen Tan Dung also required the SBV to promptly implement essential tasks geared to further develop banking operations in a safe and sustainable manner in the context of international economic integration.
Accordingly, violations must be strictly and publicly punished in order to prevent corruption in the banking system, particularly in licensing the establishment of commercial banks, the opening of representative offices, the increase of chartered capital, and the purchase of shares of local commercial banks by foreign investors, the dispatch stated.
Source: VNA
Foreign banks are allowed to open representative offices, set up joint ventures or wholly foreign-owned banks in Viet Nam or buy shares from local joint-stock commercial banks.
Under a dispatch sent by the Government Office on Mar. 20, PM Nguyen Tan Dung also required the SBV to promptly implement essential tasks geared to further develop banking operations in a safe and sustainable manner in the context of international economic integration.
Accordingly, violations must be strictly and publicly punished in order to prevent corruption in the banking system, particularly in licensing the establishment of commercial banks, the opening of representative offices, the increase of chartered capital, and the purchase of shares of local commercial banks by foreign investors, the dispatch stated.
Source: VNA
SSC pledges to tighten OTC rules
Chairman of the State Securities Commission (SSC) Vu Bang has vowed to rein in rampant transactions on the OTC stock exchange as a measure to reduce risks emerging from this fledgling market.
The chief regulator made the pledge in his first on-line talk with the public on March 21 from the office of the electronic newspaper run by the Communist Party of Viet Nam (CPV), where he received about 1,100 questions.
He said he understood that the over-the-counter (OTC) stock market has been operating in the absence of regulations.
The market lacks transparent information, is exposed to high risks of fraudulence and face collapses, he admitted.
Bang made it clear that his agency is taking steps to reduce the scale of OTC transactions by ordering all public companies, including unlisted ones, to register their operations again, hold training and refresher courses for staff and list shareholders in public.
They are also asked to invite auditors and make public information on the auditing results and management work in line with the securities regulation, said the SSC chief.
He also unveiled new rules on punishments against violations, including deliberately avoiding registration and any failure to follow existing rules on deposit making and registration by public companies.
These efforts aim to reduce risks to payment in the OTC market, he emphasised.
The SSC will apply these rules to the transaction of unlisted shares and encourage investors to do transactions through securities companies, he added.
Deposit payments will be conducted through the securities deposit centre, thus gradually publicising OTC operations and attracting transactions onto the official market, he concluded.
Despite all these burning issues, Dao Duy Quat, Editor in chief of the CPV electronic newspaper, said the Viet Nam stock market has made a turning point in its development, catching interests of an increasing number of investors and CEOs of financial and banking institutions both at home and abroad
Source: VNA
The chief regulator made the pledge in his first on-line talk with the public on March 21 from the office of the electronic newspaper run by the Communist Party of Viet Nam (CPV), where he received about 1,100 questions.
He said he understood that the over-the-counter (OTC) stock market has been operating in the absence of regulations.
The market lacks transparent information, is exposed to high risks of fraudulence and face collapses, he admitted.
Bang made it clear that his agency is taking steps to reduce the scale of OTC transactions by ordering all public companies, including unlisted ones, to register their operations again, hold training and refresher courses for staff and list shareholders in public.
They are also asked to invite auditors and make public information on the auditing results and management work in line with the securities regulation, said the SSC chief.
He also unveiled new rules on punishments against violations, including deliberately avoiding registration and any failure to follow existing rules on deposit making and registration by public companies.
These efforts aim to reduce risks to payment in the OTC market, he emphasised.
The SSC will apply these rules to the transaction of unlisted shares and encourage investors to do transactions through securities companies, he added.
Deposit payments will be conducted through the securities deposit centre, thus gradually publicising OTC operations and attracting transactions onto the official market, he concluded.
Despite all these burning issues, Dao Duy Quat, Editor in chief of the CPV electronic newspaper, said the Viet Nam stock market has made a turning point in its development, catching interests of an increasing number of investors and CEOs of financial and banking institutions both at home and abroad
Source: VNA
Vietcombank plans IPO by August
State-owned Vietcombank, Vietnam’s second largest bank by assets is set to launch an initial public offering (IPO) by August and list on the stock market by October.
Vietcombank would begin selling shares to the public in July or August at the latest, said Vu Viet Ngoan, general director of the bank.
The bank has completed the final steps to prepare for the IPO, and the detailed plan will be submitted to the government late next month.
As planned, the bank will have two IPOs, the first in the country and the second in an overseas market next year.
The government will consult relevant agencies over four to five weeks and the plan is expected to get final approval in June.
After going public, the state will hold a 70% stake in the bank and the remaining 30% will go to investors via domestic and overseas IPOs.
The bank plans to launch an IPO in Hong Kong or Singapore next year, where stock exchanges have recognized Vietcombank as qualifying under their basic requirements, according to a top executive.
By the end of 2006, Vietcombank had assets of VND169.46 trillion ($10.06 billion), up 23.9% on year.
It made a net profit of VND2.47 trillion during the year, up 91.5% year on year, bank figures showed.
Vietcombank is one of the four state-run banks ordered by the government to offer shares to the public this year.
The other three including Vietnam's third-largest bank Incombank and the Mekong Delta Housing Development Bank and the Bank for Agriculture and Rural Development , will follow in 2008.
Currently, Vietnamese law allows foreigners to have a 30% maximum stake in its domestic banks.
Source: Thanh Nien
Vietcombank would begin selling shares to the public in July or August at the latest, said Vu Viet Ngoan, general director of the bank.
The bank has completed the final steps to prepare for the IPO, and the detailed plan will be submitted to the government late next month.
As planned, the bank will have two IPOs, the first in the country and the second in an overseas market next year.
The government will consult relevant agencies over four to five weeks and the plan is expected to get final approval in June.
After going public, the state will hold a 70% stake in the bank and the remaining 30% will go to investors via domestic and overseas IPOs.
The bank plans to launch an IPO in Hong Kong or Singapore next year, where stock exchanges have recognized Vietcombank as qualifying under their basic requirements, according to a top executive.
By the end of 2006, Vietcombank had assets of VND169.46 trillion ($10.06 billion), up 23.9% on year.
It made a net profit of VND2.47 trillion during the year, up 91.5% year on year, bank figures showed.
Vietcombank is one of the four state-run banks ordered by the government to offer shares to the public this year.
The other three including Vietnam's third-largest bank Incombank and the Mekong Delta Housing Development Bank and the Bank for Agriculture and Rural Development , will follow in 2008.
Currently, Vietnamese law allows foreigners to have a 30% maximum stake in its domestic banks.
Source: Thanh Nien
New Fitch rating for Vietnam
Fitch Ratings today affirmed the Long-term foreign and local currency Issuer Default ratings (IDRs) of Vietnam at 'BB-'and 'BB', respectively. At the same time, the agency also affirmed the Short-term foreign currency IDR at 'B' and the Country Ceiling at 'BB-' (BB minus). The Outlook on the ratings remains Stable.
Despite weak public finances and the need for further banking system reforms, Vietnam's improving external financial position and sustainable economic growth continue to support its sovereign ratings.
"Vietnam's rating strengths are based on the country's net external creditor status and declining gross external debt relative to GDP," said Vincent Ho, associate director of Fitch's Asia Sovereign Ratings team in Hong Kong.
"Continuous fiscal deficits, rising general government debt relative to GDP and the vulnerable banking system remain the major rating constraints," Ho added.
Vietnam's strong external sector performance has allowed for a steady accumulation of foreign exchange reserves.
Relative to reserves, the country's gross external financing requirement and international liquidity ratios are stronger than the 'BB' peer group median.
The increase in reserves has been driven mainly by private remittances and net foreign direct investment (FDI) inflows.
In addition, gross external debt fell to about 30 percent of GDP in 2006, which was the lowest for the past decade. For the first time, Vietnam became a net external creditor in 2006 and Fitch expects this to be sustained in the medium-term.
The country's "renovation" policy towards a market-based economy has proven to be a success. During 1996-2006, the average economic growth rate was 7.3 percent per annum, which was second only to China in the region.
Strong growth and the country's favorable investment climate have been attracting large FDI capital inflows. In 2006 FDI inflows were estimated at USD2.4 billion. With its accession to the WTO, Fitch believes Vietnam's external sector will continue to grow and strengthen its external financial position.
The transformation of the Development Assistance Fund into the Vietnam Development Bank and the introduction of sounder regulations have led to reductions in policy lending activities and the dominance of state-owned commercial banks (SOCBs).
For the system as a whole, non-performing loans relative to total loans have been falling. Even so, SOCBs still account for 75% of system assets, and limited foreign participation suggests the evolution towards a more internationally competitive banking system will take time. Fitch believes the equatization of the SOCBs could help to expedite the needed changes.
In addition to the weaknesses in the banking system, continuous general government fiscal deficits (including grants, off-budget investments and on-lending) and rising debt relative to GDP are major rating constraints.
Source: Thanh Nien
Wednesday, March 21, 2007
Money laundry on the stock exchange
Deputy Governor of the State Bank of Vietnam Phung Khac Ke affirmed that dirty money was being laundered in the stock market.
There are two sources of investment capital in the stock market: domestic and foreign sources. Mr Ke said that a proportion of the domestically invested capital comes from illegal sources, i.e. from corrupt affairs.
Recently, Government inspectors have announced the ratio of losses in capital construction works at 10% - a very big figure. Every year, Vietnam spends VND200tril (12.5bil US$) on capital construction works, and 10% of this amount, or VND20tril (1.25bil US$), is pocketed by corrupt officials. They try to launder the money by throwing the money onto the stock market.
Mr Ke has stressed that the flow of illegal capital sources is one of the reasons for the heating up of the stock market.
He said that money laundering through the stock market should be stopped right now. The most effective long-term solution is to prevent and reduce the loss proportions in capital construction projects, which will only be attained by drastic measures to fight corruption. The State Bank and commercial banks will help by improving payment services and make it easier for people to open accounts. In the long term, the Government has to apply measures to encourage people to make payments via banks, which will help control money flows.
Regarding loaning to securities investors, Mr Ke confirmed the figures about the total outstanding loans funding securities investment deals that newspapers have reported. He said that this figure represents a very small percentage of capital of commercial banks, and that this should not be considered a worry.
“In general it is unreasonable to say that banks have injected too much money in the stock market,” Mr Ke said.
He has also announced that the stock market will have new commodities soon, when state owned banks are equitised. These commodities, according to Mr Ke, will be ‘valuable commodities’ for two reasons. First, the bad debts of the banks had been settled by 2000. Second, the chartered capital of the banks has been raised in the recent past, making the banks more attractive in terms of brand names and financial capability.
Source: VNE
There are two sources of investment capital in the stock market: domestic and foreign sources. Mr Ke said that a proportion of the domestically invested capital comes from illegal sources, i.e. from corrupt affairs.
Recently, Government inspectors have announced the ratio of losses in capital construction works at 10% - a very big figure. Every year, Vietnam spends VND200tril (12.5bil US$) on capital construction works, and 10% of this amount, or VND20tril (1.25bil US$), is pocketed by corrupt officials. They try to launder the money by throwing the money onto the stock market.
Mr Ke has stressed that the flow of illegal capital sources is one of the reasons for the heating up of the stock market.
He said that money laundering through the stock market should be stopped right now. The most effective long-term solution is to prevent and reduce the loss proportions in capital construction projects, which will only be attained by drastic measures to fight corruption. The State Bank and commercial banks will help by improving payment services and make it easier for people to open accounts. In the long term, the Government has to apply measures to encourage people to make payments via banks, which will help control money flows.
Regarding loaning to securities investors, Mr Ke confirmed the figures about the total outstanding loans funding securities investment deals that newspapers have reported. He said that this figure represents a very small percentage of capital of commercial banks, and that this should not be considered a worry.
“In general it is unreasonable to say that banks have injected too much money in the stock market,” Mr Ke said.
He has also announced that the stock market will have new commodities soon, when state owned banks are equitised. These commodities, according to Mr Ke, will be ‘valuable commodities’ for two reasons. First, the bad debts of the banks had been settled by 2000. Second, the chartered capital of the banks has been raised in the recent past, making the banks more attractive in terms of brand names and financial capability.
Source: VNE
The necessity of controlling foreign investment
Investors once breathed a sigh of relief when the Government announced it would not apply measures to control foreign portfolio investment flow in the stock market. However, the market has become stirred up again by the news that the Government will enact the regulation of monitoring securities companies, investment funds and fund management companies through many restrictions.
The draft regulation has been facing strong opposition from the Vietnam Association of Financial Investors (VAFI), which said that 80% of investment funds would withdraw from Vietnam if the draft regulation was enacted.
Phung Khac Ke, Deputy Governor of the State Bank of Vietnam (SBV), said that every country applies certain technical barriers to monitor the market and make it develop on the right track or the way the Government wants. Every country wants to seek prestigious and capable investors, which can ensure the sustainable growth of the market. “These are technical barriers, not policy barriers,” Mr Ke stressed.
When asked if the majority of the investment funds would withdraw from the market, Mr Ke said that the regulation, if enacted, would not be retroactive, which means that the operational funds that cannot meet the new regulations would still be allowed to operate in Vietnam.
“Only the investment funds to be set up after the regulation is enacted would have to meet the requirements. I think that the State Securities Commission (SSC) also thinks this way,” Mr Ke said.
He added that the principle of non-retroactive effect would be suitable in this case, as investors have come to Vietnam in the early days of the stock market.
Truong Van Phuoc, Director of the State Bank of Vietnam’s Transaction Centre, said that the question that policy makers always raise when compiling regulations is which goals the policies aim to.
“If Vietnam wants to attract stable capital flow which can serve long-term development, it must have a suitable mechanism to filter capital. We have to, as Vietnamese people always say, pick our company,” Mr Phuoc said.
However, Mr Phuoc said that state management authorities should consider carefully the measures to be applied, adding that administrative orders sometimes do not bring the desired effects. “The market should be controlled by economic measures rather than administrative orders,” he said.
Source: VNE
The draft regulation has been facing strong opposition from the Vietnam Association of Financial Investors (VAFI), which said that 80% of investment funds would withdraw from Vietnam if the draft regulation was enacted.
Phung Khac Ke, Deputy Governor of the State Bank of Vietnam (SBV), said that every country applies certain technical barriers to monitor the market and make it develop on the right track or the way the Government wants. Every country wants to seek prestigious and capable investors, which can ensure the sustainable growth of the market. “These are technical barriers, not policy barriers,” Mr Ke stressed.
When asked if the majority of the investment funds would withdraw from the market, Mr Ke said that the regulation, if enacted, would not be retroactive, which means that the operational funds that cannot meet the new regulations would still be allowed to operate in Vietnam.
“Only the investment funds to be set up after the regulation is enacted would have to meet the requirements. I think that the State Securities Commission (SSC) also thinks this way,” Mr Ke said.
He added that the principle of non-retroactive effect would be suitable in this case, as investors have come to Vietnam in the early days of the stock market.
Truong Van Phuoc, Director of the State Bank of Vietnam’s Transaction Centre, said that the question that policy makers always raise when compiling regulations is which goals the policies aim to.
“If Vietnam wants to attract stable capital flow which can serve long-term development, it must have a suitable mechanism to filter capital. We have to, as Vietnamese people always say, pick our company,” Mr Phuoc said.
However, Mr Phuoc said that state management authorities should consider carefully the measures to be applied, adding that administrative orders sometimes do not bring the desired effects. “The market should be controlled by economic measures rather than administrative orders,” he said.
Source: VNE
Petrovietnam allowed to raise new capital
The Viet Nam Oil and Gas Group (PetroVietnam) has been granted permission by the prime minister to find new funds.
A governmental decision stipulates that the company can mobilise business capital by issuing bonds and certificates of deposit or by taking out loans with financial institutions.
The group has the right to decide its own investment projects and to set its own selling and buying prices – excluding public services, which are set by the State.
PetroVietnam is also legally permitted to set up, disband or transfer ownership of its subsidies, branches and representative offices at home and abroad.
Under the terms of the law on petroleum, PetroVietnam can directly produce and trade petroleum products and equipment.
The decision also stipulates that the government and the prime minister have the right to make decisions on establishment, reorganisation, disbandment and equitisation of PetroVietnam, according to the wishes of its management board and the ministers of industry, finance, and planning and investment. The decision also requests PetroVietnam to make its financial reports available at short notice.
The group wholly owns six subsidiaries and 50% of 11 other subsidiaries.
Source: VNS
A governmental decision stipulates that the company can mobilise business capital by issuing bonds and certificates of deposit or by taking out loans with financial institutions.
The group has the right to decide its own investment projects and to set its own selling and buying prices – excluding public services, which are set by the State.
PetroVietnam is also legally permitted to set up, disband or transfer ownership of its subsidies, branches and representative offices at home and abroad.
Under the terms of the law on petroleum, PetroVietnam can directly produce and trade petroleum products and equipment.
The decision also stipulates that the government and the prime minister have the right to make decisions on establishment, reorganisation, disbandment and equitisation of PetroVietnam, according to the wishes of its management board and the ministers of industry, finance, and planning and investment. The decision also requests PetroVietnam to make its financial reports available at short notice.
The group wholly owns six subsidiaries and 50% of 11 other subsidiaries.
Source: VNS
Securities firm to insure its brokerage services
The Dai Viet Securities Company (DVSC) is in discussions to insure its brokerage services, and could become the first in Viet Nam to obtain such insurance.
Bui Van Tuynh, DVSC general director, said he was in discussion with French-British insurance broker Gras Savoye Willis Vietnam to find an appropriate insurer.
"We’re extremely interested in this kind of insurance since it will protect both brokers and customers, ensuring stability in the market," Tuynh said. The Securities Law prescribed such cover, he added.
"If more securities firms join us in the insurance contract, the premium will be lower," he told the Viet Nam News on the sidelines of a seminar on securities brokerage insurance last week in which DVSC and Gras Savoye Willis briefed securities companies on the advantages of insurance.
The insurance normally covers brokers’ malpractice including inappropriate recommendations, misrepresentation, unauthorised trading, failing to follow instructions, and price manipulation.
There are almost 40 securities companies providing brokerage services in Viet Nam while Vietnamese insurance companies do not offer policies for stockbrokers. However, DVSC’s policy would be with a local company that is in turn reinsured by a foreign insurer, possibly acting as a catalyst for the introduction of this product in the country.
Source: VNS
Bui Van Tuynh, DVSC general director, said he was in discussion with French-British insurance broker Gras Savoye Willis Vietnam to find an appropriate insurer.
"We’re extremely interested in this kind of insurance since it will protect both brokers and customers, ensuring stability in the market," Tuynh said. The Securities Law prescribed such cover, he added.
"If more securities firms join us in the insurance contract, the premium will be lower," he told the Viet Nam News on the sidelines of a seminar on securities brokerage insurance last week in which DVSC and Gras Savoye Willis briefed securities companies on the advantages of insurance.
The insurance normally covers brokers’ malpractice including inappropriate recommendations, misrepresentation, unauthorised trading, failing to follow instructions, and price manipulation.
There are almost 40 securities companies providing brokerage services in Viet Nam while Vietnamese insurance companies do not offer policies for stockbrokers. However, DVSC’s policy would be with a local company that is in turn reinsured by a foreign insurer, possibly acting as a catalyst for the introduction of this product in the country.
Source: VNS
New securities broker starts at VSE
The Southeast Asia Commercial Joint Stock Bank Securities Company (Seabank) made its debut at the Ho Chi Minh City Securities Trading Centre on Mar. 20, becoming the 36th member at the stock exchange.
Seabank, with a statutory capital of 50 billion VND, engages in securities brokerage, trading and issuance underwriting in addition to providing financial and securities investment consultancy and other financial services.
The company is expected to increase its statutory capital by three-fold this year and by six-fold by 2008.
Source: VNA
Seabank, with a statutory capital of 50 billion VND, engages in securities brokerage, trading and issuance underwriting in addition to providing financial and securities investment consultancy and other financial services.
The company is expected to increase its statutory capital by three-fold this year and by six-fold by 2008.
Source: VNA
Foreign investors interested in real estate
Japan ’s Asahi newspaper said on Mar. 20 that Viet Nam ’s real estate market has developed strongly and become more attractive to foreign investors.
The demand for housing, offices and restaurants for lease in Viet Nam will see rapid increase as the country’s economy is expected to achieve an average annual growth rate of about 8% in the next decade. Viet Nam ’s entry into the World Trade Organisation (WTO) will provide a driving force for its economic development, the paper said.
The joint-stock IndoChina Land company, which has invested one billion US$ in Viet Nam ’s real estate market in the past ten years, plans to inject additional one billion US$ into new projects in the future.
IndoChina Land ’s office manager Rick Mayor-Smith said the company plans to invest in building offices and apartment buildings in the next 18-24 months. Viet Nam ’s high economic growth rate has helped accelerate the development of the country’s real estate market, he said.
Meanwhile, Singapore ’s third largest real estate development company Keppel Land has established a joint venture in Viet Nam to build 1,600 apartments with total investment capital of 106 billion US$. The Banyan Tree Holdings has intended investing 270mio US$ in building a resort in central Da Nang city.
The paper quoted Peter Mitchell, Chief Executive Officer of the Asian Public Real Estate Association, as saying that Viet Nam is a symbol of the growth and a motive force for other Asian economies.
Source: VNA
The demand for housing, offices and restaurants for lease in Viet Nam will see rapid increase as the country’s economy is expected to achieve an average annual growth rate of about 8% in the next decade. Viet Nam ’s entry into the World Trade Organisation (WTO) will provide a driving force for its economic development, the paper said.
The joint-stock IndoChina Land company, which has invested one billion US$ in Viet Nam ’s real estate market in the past ten years, plans to inject additional one billion US$ into new projects in the future.
IndoChina Land ’s office manager Rick Mayor-Smith said the company plans to invest in building offices and apartment buildings in the next 18-24 months. Viet Nam ’s high economic growth rate has helped accelerate the development of the country’s real estate market, he said.
Meanwhile, Singapore ’s third largest real estate development company Keppel Land has established a joint venture in Viet Nam to build 1,600 apartments with total investment capital of 106 billion US$. The Banyan Tree Holdings has intended investing 270mio US$ in building a resort in central Da Nang city.
The paper quoted Peter Mitchell, Chief Executive Officer of the Asian Public Real Estate Association, as saying that Viet Nam is a symbol of the growth and a motive force for other Asian economies.
Source: VNA
FDI record predicted
Viet Nam is likely to achieve a new record in attracting foreign direct investment (FDI) in 2007, said representatives from several major international financial groups at the second Viet Nam Investment Forum, which opened in Ha Noi on Mar. 19.
"Attracting between 15-17 billion US$ in FDI each year is within the country's reach," said General Director of the Vina Capital Fund, Don Lam. He revealed the company's plan to invest
400mio US$ in building a complex of shopping centres and apartments for lease in Viet Nam.
Director General of the Dragon Capital Fund, Dominic Scriven, shared Lam's view, adding that a series of big investment projects will be implemented in Viet Nam in the near future, including a five billion US$ project of the HonHai Precision Industry Ltd. Company of Taiwan.
General Director of the Hong Kong and Shanghai Banking Corporation (HSBC), Michael Geoghegan, noted propitious conditions making Viet Nam an appealing destination to foreign investors, citing the country's young population and an abundant labour force with improved skills. Additionally, he said, Vietnamese people are quick to take to hi-tech services like the Internet and mobile phones.
Viet Nam's accession to the World Trade Organisation (WTO) would bring in new opportunities for the country's economy, particularly in the volume of FDI, added Geoghegan.
Participants at the forum agreed that how Viet Nam could maintain this capital flow is a challenge facing the country as many difficulties still remain in implementing approved projects, such as low capital disbursement, cumbersome procedures and a lack of synchronicity in enforcing laws.
The Vina Capital director said how Viet Nam opens its door and implements its commitments will affect their decision to invest in Viet Nam.
Dragon Capital's chief Scriven also agreed that the flow of direct or indirect foreign investment depends on domestic factors, and whether a country could maintain the investment capital flow depends on the way it treats customers and partners. However, he said he is optimistic that the capital flow pouring into Viet Nam will continue increasing.
According to the latest economic freedom ratings published by the Fraser Institute and members of the Economic Freedom Network, Viet Nam is ranked 138 out of the 157 rated economies while China, 119 and Thailand, 50.
Therefore, investors pointed to the need for Viet Nam to promote capital management capacity, reform investment licensing process, and create a more open and transparent investment and business environment.
Source: VNA
"Attracting between 15-17 billion US$ in FDI each year is within the country's reach," said General Director of the Vina Capital Fund, Don Lam. He revealed the company's plan to invest
400mio US$ in building a complex of shopping centres and apartments for lease in Viet Nam.
Director General of the Dragon Capital Fund, Dominic Scriven, shared Lam's view, adding that a series of big investment projects will be implemented in Viet Nam in the near future, including a five billion US$ project of the HonHai Precision Industry Ltd. Company of Taiwan.
General Director of the Hong Kong and Shanghai Banking Corporation (HSBC), Michael Geoghegan, noted propitious conditions making Viet Nam an appealing destination to foreign investors, citing the country's young population and an abundant labour force with improved skills. Additionally, he said, Vietnamese people are quick to take to hi-tech services like the Internet and mobile phones.
Viet Nam's accession to the World Trade Organisation (WTO) would bring in new opportunities for the country's economy, particularly in the volume of FDI, added Geoghegan.
Participants at the forum agreed that how Viet Nam could maintain this capital flow is a challenge facing the country as many difficulties still remain in implementing approved projects, such as low capital disbursement, cumbersome procedures and a lack of synchronicity in enforcing laws.
The Vina Capital director said how Viet Nam opens its door and implements its commitments will affect their decision to invest in Viet Nam.
Dragon Capital's chief Scriven also agreed that the flow of direct or indirect foreign investment depends on domestic factors, and whether a country could maintain the investment capital flow depends on the way it treats customers and partners. However, he said he is optimistic that the capital flow pouring into Viet Nam will continue increasing.
According to the latest economic freedom ratings published by the Fraser Institute and members of the Economic Freedom Network, Viet Nam is ranked 138 out of the 157 rated economies while China, 119 and Thailand, 50.
Therefore, investors pointed to the need for Viet Nam to promote capital management capacity, reform investment licensing process, and create a more open and transparent investment and business environment.
Source: VNA
Vinalines to issue bonds
The Viet Nam National Shipping Lines (Vinalines) will increase its contacts with Moody's and Standard and Poors to find out its trust index to make preparations for the issuance of its bond on the international financial market.
To the target, Vinalines, the largest shipping company in the country, plans to set up its branches in Japan, the European Union and the US and other major export-import partners of
Viet Nam in order to collect market information and promote its trademark. In the meantime, Vinalines will expand its relations with international financial organisations and other foreign and domestic prestigious partners to mobilise capital for investment. In the near future, Vinalines will borrow around 200mio US$ from City Group of the US and 150 million USD from Deutsche Bank AG of Germany to invest in developing its vessel fleet, seaports and maritime services.
Of late, Credit Suisse of Switzerland agreed to provide 1 billion US$ in loan to Vinalines to develop its vessel fleet, build seaports' infrastructure facilities and develop maritime services.
According to Vinalines' 2006-2010 development plan and orientation for 2020 that have been approved by the Prime Minister, the company needs around 51 trillion VND with 33.7 trillion VND going for its vessel fleet development and 13.3 trillion VND for capital construction.
Source: VNA
To the target, Vinalines, the largest shipping company in the country, plans to set up its branches in Japan, the European Union and the US and other major export-import partners of
Viet Nam in order to collect market information and promote its trademark. In the meantime, Vinalines will expand its relations with international financial organisations and other foreign and domestic prestigious partners to mobilise capital for investment. In the near future, Vinalines will borrow around 200mio US$ from City Group of the US and 150 million USD from Deutsche Bank AG of Germany to invest in developing its vessel fleet, seaports and maritime services.
Of late, Credit Suisse of Switzerland agreed to provide 1 billion US$ in loan to Vinalines to develop its vessel fleet, build seaports' infrastructure facilities and develop maritime services.
According to Vinalines' 2006-2010 development plan and orientation for 2020 that have been approved by the Prime Minister, the company needs around 51 trillion VND with 33.7 trillion VND going for its vessel fleet development and 13.3 trillion VND for capital construction.
Source: VNA
Tuesday, March 20, 2007
VinaCapital buys Omni Saigon Hotel
The London-listed VinaCapital has bought a 70% stake in Ho Chi Minh City’s Omni Saigon Hotel for 22mio US$ as part of its strategy to invest in the country’s property market.
VinaCapital said on its website that its two London-listed funds, VinaLand and the Vietnam Opportunity Fund (VOF), had picked up respectively 52.5% and 17.5% of the shares.
The remaining stakes are owned by local company Vietnam YouthCo but it is not known who sold the 70% stake to VinaCapital.
At a recent news briefing in HCMC, VinaCapital’s director, Don Lam, said VinaLand had invested in the parent company of Omni Saigon but refused to provide further details.
In August last year, the two funds paid a combined 43mio US$ to acquire a 70% stake in the Hilton Opera Hanoi, which is among the most profitable hotels in the capital.
VinaCapital also holds a 29% stake in the century-old Sofitel Metropole Hanoi, another top hotel in the Vietnamese capital.
Established in 2003, VinaCapital now manages three funds with a total corpus of nearly 1 billion US$: the $600 million, London-listed VOF; 205mio US$ Vinaland; and 50mio US$ DFJ VinaCapital L.P. which invests in information and communication technology firms.
Source: Thanh Nien
VinaCapital said on its website that its two London-listed funds, VinaLand and the Vietnam Opportunity Fund (VOF), had picked up respectively 52.5% and 17.5% of the shares.
The remaining stakes are owned by local company Vietnam YouthCo but it is not known who sold the 70% stake to VinaCapital.
At a recent news briefing in HCMC, VinaCapital’s director, Don Lam, said VinaLand had invested in the parent company of Omni Saigon but refused to provide further details.
In August last year, the two funds paid a combined 43mio US$ to acquire a 70% stake in the Hilton Opera Hanoi, which is among the most profitable hotels in the capital.
VinaCapital also holds a 29% stake in the century-old Sofitel Metropole Hanoi, another top hotel in the Vietnamese capital.
Established in 2003, VinaCapital now manages three funds with a total corpus of nearly 1 billion US$: the $600 million, London-listed VOF; 205mio US$ Vinaland; and 50mio US$ DFJ VinaCapital L.P. which invests in information and communication technology firms.
Source: Thanh Nien
Robust economic growth in Vietnam will continue
Viet Nam is the new powerhouse of Southeast Asia, according to Renee Chen, economic specialist from CitiGroup, who predicted the nation’s ecomomic growth would continue at a robust 8% or more for the next two years, following the 8.2% pace set in 2006.
The growth drivers included rising foreign investment, export expansion and increased consumer spending, Chen said, and Viet Nam’s WTO entry would further boost foreign investor confidence by ensuring a more stable regulatory environment and more level playing field between foreign and domestic enterprises.
The benefits of being a WTO member would also include fewer restrictions on exports to other member economies, including lower tariffs and the removal of quotas on textile and garment shipments to the US and EU, Chen said.
WTO accession would also help lock Viet Nam onto the path of continuous reform, particularly in the banking sector and the role of State-owned enterprises in the market.
The services sector, including banking and selected retail distribution services, would be opened up to foreign ownership and competition. Foreign banks, for example, would be allowed to establish 100-per-cent foreign-owned subsidiary banks in Viet Nam, effective next month.
To prepare domestic banks for the competition and ensure their solvency, the State Bank of Viet Nam has imposed higher chartered capital requirements on domestic joint stock banks. Regulations now stipulate that the minimum statutory capital of a joint stock bank must be VND1 trillion by 2008 and VND3 trillion by 2010.
According to Charly Madan, general manager of CitiGroup Viet Nam, Vietnamese banks have also been issuing shares to foreign strategic shareholders as an efficient way to expand operational networks and develop modern technology and management expertise.
A secure future
The year 2006 also witnessed exceptional growth in the securities market. The number of listed companies on both the HCM City Securities Trading Centre and Ha Noi Securities Trading Centre surged from 32 to 193, and stock prices rose sharply. Total market capitalisation rose twenty-fold year-on-year to reach 14 billion US$ (22.7% of GDP) at the end of 2006, far beyond the official target set in 2003 of 10-15% of GDP by 2010.
The State Securities Commission now foresees that stock market capitalisation could increase to 30-40% of GDP by 2010. Counting 5 billion US$ in bonds, securities market capitalisation already equalled about 30% of GDP as of the end of 2006.
"We expect the securities markets to grow robustly over the next two years amid strong capital demand for development (estimated to exceed 140 billion US$ over 2006-10).
The equitisation of State-owned enterprises and commercial banks will provide substantial new fodder for the stock market; and arge inflows of foreign indirect investment will continue," said Madan.
The strong appetite of foreign investors for 10-year Vietnamese dong-dominated Government bonds in November 2006 attested to the possibilities for financing a growing share of Viet Nam’s capital needs through the debt market.
The State Bank widened the inter-bank trading band for Vietnamese dong to +/-0.5% from +/-0.25% in early January. Substantial foreign direct investment and increasing portfolio inflows have boosted US dollar supplies and added to domestic liquidity in late 2006.
Foreign reserve accumulations are a precautionary move designed to maintain export competitiveness. At about 12 billion US$ at of end 2006, Viet Nam’s forex reserves were small compared to large reserves built-up elsewhere in Asia, limiting the scope for significant appreciation of the Vietnamese dong in the near future.
A wider trading band to cope with dong appreciation pressures could see the dong departing from its past behaviour of depreciation to remain increasingly steady against the US dollar. We expect to see increasing flexibility in currency movement via further band widening and/or easing of restrictions on capital flows, moves consistent with the official target to make the Vietnamese dong fully convertible by 2010.
Sharp increases in foreign reserves and substantial capital inflows could pose medium-term risks of non-performing loans. Prudent measures should be taken to manage money flows and minimise risks in the capital markets. New regulations to tighten stock market-related lending, for example, by banning commercial banks from granting loans to their affiliate securities companies for securities trading, and measures to stabilise the overheated stock market, including a decision to temporarily hold the ceiling on foreign ownership in listed companies at 49%, were desired moves, Madan said.
While authorities have planned to set up a watchdog agency to supervise the financial markets, more needed to be done in particular to improve corporate governance and public disclosure of listed companies, he added.
Source: VNS
The growth drivers included rising foreign investment, export expansion and increased consumer spending, Chen said, and Viet Nam’s WTO entry would further boost foreign investor confidence by ensuring a more stable regulatory environment and more level playing field between foreign and domestic enterprises.
The benefits of being a WTO member would also include fewer restrictions on exports to other member economies, including lower tariffs and the removal of quotas on textile and garment shipments to the US and EU, Chen said.
WTO accession would also help lock Viet Nam onto the path of continuous reform, particularly in the banking sector and the role of State-owned enterprises in the market.
The services sector, including banking and selected retail distribution services, would be opened up to foreign ownership and competition. Foreign banks, for example, would be allowed to establish 100-per-cent foreign-owned subsidiary banks in Viet Nam, effective next month.
To prepare domestic banks for the competition and ensure their solvency, the State Bank of Viet Nam has imposed higher chartered capital requirements on domestic joint stock banks. Regulations now stipulate that the minimum statutory capital of a joint stock bank must be VND1 trillion by 2008 and VND3 trillion by 2010.
According to Charly Madan, general manager of CitiGroup Viet Nam, Vietnamese banks have also been issuing shares to foreign strategic shareholders as an efficient way to expand operational networks and develop modern technology and management expertise.
A secure future
The year 2006 also witnessed exceptional growth in the securities market. The number of listed companies on both the HCM City Securities Trading Centre and Ha Noi Securities Trading Centre surged from 32 to 193, and stock prices rose sharply. Total market capitalisation rose twenty-fold year-on-year to reach 14 billion US$ (22.7% of GDP) at the end of 2006, far beyond the official target set in 2003 of 10-15% of GDP by 2010.
The State Securities Commission now foresees that stock market capitalisation could increase to 30-40% of GDP by 2010. Counting 5 billion US$ in bonds, securities market capitalisation already equalled about 30% of GDP as of the end of 2006.
"We expect the securities markets to grow robustly over the next two years amid strong capital demand for development (estimated to exceed 140 billion US$ over 2006-10).
The equitisation of State-owned enterprises and commercial banks will provide substantial new fodder for the stock market; and arge inflows of foreign indirect investment will continue," said Madan.
The strong appetite of foreign investors for 10-year Vietnamese dong-dominated Government bonds in November 2006 attested to the possibilities for financing a growing share of Viet Nam’s capital needs through the debt market.
The State Bank widened the inter-bank trading band for Vietnamese dong to +/-0.5% from +/-0.25% in early January. Substantial foreign direct investment and increasing portfolio inflows have boosted US dollar supplies and added to domestic liquidity in late 2006.
Foreign reserve accumulations are a precautionary move designed to maintain export competitiveness. At about 12 billion US$ at of end 2006, Viet Nam’s forex reserves were small compared to large reserves built-up elsewhere in Asia, limiting the scope for significant appreciation of the Vietnamese dong in the near future.
A wider trading band to cope with dong appreciation pressures could see the dong departing from its past behaviour of depreciation to remain increasingly steady against the US dollar. We expect to see increasing flexibility in currency movement via further band widening and/or easing of restrictions on capital flows, moves consistent with the official target to make the Vietnamese dong fully convertible by 2010.
Sharp increases in foreign reserves and substantial capital inflows could pose medium-term risks of non-performing loans. Prudent measures should be taken to manage money flows and minimise risks in the capital markets. New regulations to tighten stock market-related lending, for example, by banning commercial banks from granting loans to their affiliate securities companies for securities trading, and measures to stabilise the overheated stock market, including a decision to temporarily hold the ceiling on foreign ownership in listed companies at 49%, were desired moves, Madan said.
While authorities have planned to set up a watchdog agency to supervise the financial markets, more needed to be done in particular to improve corporate governance and public disclosure of listed companies, he added.
Source: VNS
Bao Minh signs airline insurance deal
Bao Minh Insurance Corporation and the Viet Nam Insurance Corporation (Bao Viet ) on March 16 signed a 4 billion US$ insurance contract with Vietnam Airlines.
Over 2.5 billion US$ of the total will be spent on aircraft insurance while about 1.5 billion US$ will go towards liability insurance. Bao Minh is the lead company in the deal.
In the past few years, Vietnam Airlines has coordinated with leading national insurance companies such as Bao Minh and Bao Viet in insuring its planes and passengers under international standards.
Bao Minh, the second largest insurer in Viet Nam, listed its shares on the Ha Noi stock exchange in November, last year. It has forecasted revenues of 1.6 trillion VND (100mio US$) in 2007, a 6% increase over the 2006 figures. After-tax profits have been pegged at 110 billion VND (6.88mio US$).
Revenues last year reached more than 1.4 trillion VND (90.3mio US$). The re-insurance division was especially strong, earning 80.9 billion VND (5.05mio US$), up 58% from 2005.
Source: VNA
Over 2.5 billion US$ of the total will be spent on aircraft insurance while about 1.5 billion US$ will go towards liability insurance. Bao Minh is the lead company in the deal.
In the past few years, Vietnam Airlines has coordinated with leading national insurance companies such as Bao Minh and Bao Viet in insuring its planes and passengers under international standards.
Bao Minh, the second largest insurer in Viet Nam, listed its shares on the Ha Noi stock exchange in November, last year. It has forecasted revenues of 1.6 trillion VND (100mio US$) in 2007, a 6% increase over the 2006 figures. After-tax profits have been pegged at 110 billion VND (6.88mio US$).
Revenues last year reached more than 1.4 trillion VND (90.3mio US$). The re-insurance division was especially strong, earning 80.9 billion VND (5.05mio US$), up 58% from 2005.
Source: VNA
Indochina Capital's fund makes positive debut
Indochina Capital Vietnam Holdings Limited announced its successful debut of its shares listed on the London Stock Exchange (LSE) in Ha Noi on March 19.
Managed by Indochina Capital, the fund is worth 500mio US$, about 200mio US$ more than planned.
This includes a 50mio US$ green shoe option.
"This is much higher than out initial target of between 300 and 350mio US$," said Peter Ryder, chief executive officer of Indochina Capital.
The investment jump is in part thanks to investment from 10 institutions including Tudor Funds, Deutsche Bank Prop Desk and Citigroup Global Markets that committed 225mio US$ to the company before the fund's initial public offering (IPO).
"We are delighted that so many prominent foreign institutional investors have chosen to invest in the fund's IPO. We believe the fund is well positioned to be a long-term investor in Vietnamese companies," said Ryder.
The investment fund is Viet Nam's first to be listed on the LSE's main board. It went public on March 7 under the stock ticker ICV.L and is considered a closed-end company.
Credit Suisse insured the company's IPO with Mekong Securities Joint Stock Company brokering the deal.
Tung Kim Nguyen, co-chief investment officer of Indochina Capital, said the fund will invest carefully in a broad range of businesses like private joint-stock companies, State-owned companies that are equitised, joint ventures and fixed income securities.
"Many of the companies we are going to invest in have not yet listed in Ha Noi or Ho Chi Minh City, but have a chance of listing in the future," said Nguyen.
Established in Viet Nam in 1999, Indochina Capital also manages two real estate funds, worth a combined 300mio US$. In total, the company manages around 900mio US$ in equities and bonds as well as real estate funds.
Indochina Capital chose the London Stock Exchange because it was most feasible for the company and because of its high level of liquidity.
"While most of our investors are taking a medium or long-term approach, London's great volume of daily trading means that if they have to sell their shares, there will be greater chances to do so there," said Ryder.
Source: VNA
Managed by Indochina Capital, the fund is worth 500mio US$, about 200mio US$ more than planned.
This includes a 50mio US$ green shoe option.
"This is much higher than out initial target of between 300 and 350mio US$," said Peter Ryder, chief executive officer of Indochina Capital.
The investment jump is in part thanks to investment from 10 institutions including Tudor Funds, Deutsche Bank Prop Desk and Citigroup Global Markets that committed 225mio US$ to the company before the fund's initial public offering (IPO).
"We are delighted that so many prominent foreign institutional investors have chosen to invest in the fund's IPO. We believe the fund is well positioned to be a long-term investor in Vietnamese companies," said Ryder.
The investment fund is Viet Nam's first to be listed on the LSE's main board. It went public on March 7 under the stock ticker ICV.L and is considered a closed-end company.
Credit Suisse insured the company's IPO with Mekong Securities Joint Stock Company brokering the deal.
Tung Kim Nguyen, co-chief investment officer of Indochina Capital, said the fund will invest carefully in a broad range of businesses like private joint-stock companies, State-owned companies that are equitised, joint ventures and fixed income securities.
"Many of the companies we are going to invest in have not yet listed in Ha Noi or Ho Chi Minh City, but have a chance of listing in the future," said Nguyen.
Established in Viet Nam in 1999, Indochina Capital also manages two real estate funds, worth a combined 300mio US$. In total, the company manages around 900mio US$ in equities and bonds as well as real estate funds.
Indochina Capital chose the London Stock Exchange because it was most feasible for the company and because of its high level of liquidity.
"While most of our investors are taking a medium or long-term approach, London's great volume of daily trading means that if they have to sell their shares, there will be greater chances to do so there," said Ryder.
Source: VNA
Foreign money pours into property market
Real estate development in Ha Noi and Ho Chi Minh City is showing signs of a heat-up with foreign investment fluxing in major projects.
Director of the Ha Noi Service of Planning and Investment Trieu Dinh Phuc said foreign investors are rushing for licenses to build high-tech parks, financial-banking meccas, new residential quarters, hotels, apartments, offices for lease, commerical centres, restaurants and super-markets.
The biggest project underway is the 500mio US$ investment in a high service complex in the district of Cau Giay. The Keangnam group from the Republic of Korea recently won the license for construction in a fierce race with another developmental giant from Japan, the Kanagawa Union under the Riviera group.
Ha Noi's Cau Giay district was chosen by the Charmvit group from the Republic of Korea to build a five star hotel on an area of almost 2 ha at a cost of 80mio US$.
The investor has applied to increase the highrise to 30 storeys from its original design of 18, to tap the advantages of this location, which is close to the National Convention Centre, opposite Big C, a major market chain. It is also close to a number of new residential quarters.
Antara Koh Development Pte.Ltd from Singapore is interested in the development of a residential complex on the northern bank of the Red River. The complex will include houses, offices for rent, shops, hotels and other public facilities.
Source: VNA
Director of the Ha Noi Service of Planning and Investment Trieu Dinh Phuc said foreign investors are rushing for licenses to build high-tech parks, financial-banking meccas, new residential quarters, hotels, apartments, offices for lease, commerical centres, restaurants and super-markets.
The biggest project underway is the 500mio US$ investment in a high service complex in the district of Cau Giay. The Keangnam group from the Republic of Korea recently won the license for construction in a fierce race with another developmental giant from Japan, the Kanagawa Union under the Riviera group.
Ha Noi's Cau Giay district was chosen by the Charmvit group from the Republic of Korea to build a five star hotel on an area of almost 2 ha at a cost of 80mio US$.
The investor has applied to increase the highrise to 30 storeys from its original design of 18, to tap the advantages of this location, which is close to the National Convention Centre, opposite Big C, a major market chain. It is also close to a number of new residential quarters.
Antara Koh Development Pte.Ltd from Singapore is interested in the development of a residential complex on the northern bank of the Red River. The complex will include houses, offices for rent, shops, hotels and other public facilities.
Source: VNA
Morgan Stanley forming Vietnam securities JV
Wall Street's Morgan Stanley said Monday it is forming a securities joint venture with Vietnam's State Capital Investment Corp., tapping a booming market that is expected to see a wave of equitizations.
The Hanoi-based joint venture, to be named SCIC Morgan Stanley Securities, will provide investment banking products such as M&A advisory and capital markets underwriting, equity and debt sales and trading, as well as research.
The venture will apply for domestic licenses and expects to begin operations in the fourth quarter.
The country's benchmark stock index jumped 144.5% in 2006 and is up more than 50% so far this year, powered in part by an influx of foreign funds chasing economic growth of 8-plus% and a population of 84 million with burgeoning spending power.
Global investment banks have been circling Vietnam in hopes of taking part in the country's surging capital markets activity. Last month, Credit Suisse and Deutsche Bank were chosen to advise as consultants to two Vietnamese banks on their equitizations this year.
Analysts expect strong growth of Vietnam's securities market over the next two years, thanks to substantial inflows of foreign direct and portfolio investment following the country's accession to the World Trade Organization (WTO).
The number of listed companies on the Ho Chi Minh City Securities Trading Center and Hanoi
Securities Trading Center surged to a combined 193 from 32 in 2006.
The total market capitalization of the two bourses rose 20 fold year-on-year to reach US$14 billion, or 22.7% of the country's GDP in 2006.
The State Securities Commission expects the stock market capitalization to jump to 30 to 40% of GDP by 2010.
State-owned SCIC, a strategic investment arm of the government of Vietnam, was created in mid-2005 to take capital ownership of the country's 5,000-plus state-run enterprises, which accounted for about 70% of the country's tax revenues.
SCIC can raise funds through issuing bonds and fund investment certificates. It is authorized to make direct and indirect investments domestically or abroad in any form or sectors.
Morgan Stanley will appoint the joint venture's chief executive, a source familiar with the tie-up said, while SCIC will name the firm's chairman. Both companies, along with staff, will hold equity stakes in the combined firm.
Source: Thanh Nien
The Hanoi-based joint venture, to be named SCIC Morgan Stanley Securities, will provide investment banking products such as M&A advisory and capital markets underwriting, equity and debt sales and trading, as well as research.
The venture will apply for domestic licenses and expects to begin operations in the fourth quarter.
The country's benchmark stock index jumped 144.5% in 2006 and is up more than 50% so far this year, powered in part by an influx of foreign funds chasing economic growth of 8-plus% and a population of 84 million with burgeoning spending power.
Global investment banks have been circling Vietnam in hopes of taking part in the country's surging capital markets activity. Last month, Credit Suisse and Deutsche Bank were chosen to advise as consultants to two Vietnamese banks on their equitizations this year.
Analysts expect strong growth of Vietnam's securities market over the next two years, thanks to substantial inflows of foreign direct and portfolio investment following the country's accession to the World Trade Organization (WTO).
The number of listed companies on the Ho Chi Minh City Securities Trading Center and Hanoi
Securities Trading Center surged to a combined 193 from 32 in 2006.
The total market capitalization of the two bourses rose 20 fold year-on-year to reach US$14 billion, or 22.7% of the country's GDP in 2006.
The State Securities Commission expects the stock market capitalization to jump to 30 to 40% of GDP by 2010.
State-owned SCIC, a strategic investment arm of the government of Vietnam, was created in mid-2005 to take capital ownership of the country's 5,000-plus state-run enterprises, which accounted for about 70% of the country's tax revenues.
SCIC can raise funds through issuing bonds and fund investment certificates. It is authorized to make direct and indirect investments domestically or abroad in any form or sectors.
Morgan Stanley will appoint the joint venture's chief executive, a source familiar with the tie-up said, while SCIC will name the firm's chairman. Both companies, along with staff, will hold equity stakes in the combined firm.
Source: Thanh Nien
Stock-market review
Seventy-nine stocks gained and fifteen lost ground in HCMC with PPC (Pha Lai Power Joint Stock Company) leading the market in terms of trading volume, with over 1.3 million shares changing hands – 15.11% of the stock exchange.
The runner-up was REE (Refrigeration Electrical Engineering Corp) with 413,880 shares being traded.
BMC (Binh Dinh Minerals Joint Stock Company) – one among the most wanted penny stocks over the past time – became the big loser yesterday, sliding VND22,000 to VND432,000 per share.
Another small stock SFI (Sea & Air Freight International) lost VND9,000 to close at VND197,000 per unit.
During yesterday’s session, some blue chips stocks stayed put, like IT developer FPT, Petroleum technical services suppliers PVD, and telecoms materials trading company SAM among others.
Nguyen Ho Nam, general director of Sacombank Securities Company, said he saw nothing that in the cards that could destabilize the stock exchange this week.
Foreign investors were net sellers yesterday, unleashing 1.9 million shares, an increase of 60% over the previous session.
In all of last year, foreign investors pumped between 2 and 3 billion US$ into the local stock exchange.
According to the market regulator, the number of securities accounts of foreign investors registered only 1,700 out of the market’s total 100,000 as of late last year.
However, foreign investors’ securities holdings accounted for 25 – 30% of the market.
Local investors are picking up on some of the habits of their foreign counterparts, beginning to invest only in quality stocks, instead of purchasing without conducting research on company performance.
But there are still plenty of local investors who continue to succumb to the ‘herd’ mentality, meaning there is plenty of cash still being pumped into the market.
Source: Thanh Nien
The runner-up was REE (Refrigeration Electrical Engineering Corp) with 413,880 shares being traded.
BMC (Binh Dinh Minerals Joint Stock Company) – one among the most wanted penny stocks over the past time – became the big loser yesterday, sliding VND22,000 to VND432,000 per share.
Another small stock SFI (Sea & Air Freight International) lost VND9,000 to close at VND197,000 per unit.
During yesterday’s session, some blue chips stocks stayed put, like IT developer FPT, Petroleum technical services suppliers PVD, and telecoms materials trading company SAM among others.
Nguyen Ho Nam, general director of Sacombank Securities Company, said he saw nothing that in the cards that could destabilize the stock exchange this week.
Foreign investors were net sellers yesterday, unleashing 1.9 million shares, an increase of 60% over the previous session.
In all of last year, foreign investors pumped between 2 and 3 billion US$ into the local stock exchange.
According to the market regulator, the number of securities accounts of foreign investors registered only 1,700 out of the market’s total 100,000 as of late last year.
However, foreign investors’ securities holdings accounted for 25 – 30% of the market.
Local investors are picking up on some of the habits of their foreign counterparts, beginning to invest only in quality stocks, instead of purchasing without conducting research on company performance.
But there are still plenty of local investors who continue to succumb to the ‘herd’ mentality, meaning there is plenty of cash still being pumped into the market.
Source: Thanh Nien
Indochina Capital invests in tourism complex
London-listed Indochina Capital will join forces with a local partner to invest in upgrading a wharf and building a commercial-tourism complex in Da Nang City.
Following the provincial authorities’ approval, Indochina Land Holdings (ILH), an affiliate of Indochina Capital, is to set up a joint venture for the investment project.
Further information on the project was not given.
As proposed, the newly-upgraded yacht wharf will provide international-standard seawater sport and rescue activities in case of emergency.
And the commercial-tourism complex will comprise of villas and high-end apartments along side Son Tra – Dien Ngoc beach for rent or sale, along with shopping malls and other facilities.
Indochina Capital, listed with the ticker symbol ICV on the London Stock Exchange earlier this month, have investments in the country and region valued at over 1 billion US$.
In related news, the first modern commercial area in Da Nang city, the Riverside Mall invested by ILH is set to open in November.
The 6,600 sq.m mall is home to garment, cosmetics, footwear, home appliances and food retailers.
The mall is located on the first three floors of the multi-purpose project Indochina Riverside Towers.
An international real estate consultancy service firm, CBRE, the sole marketing agent for the project, said that 50% of the mall had already been booked by clients and the rate would go up to at least 80% by opening time.
Source: Thanh Nien
Following the provincial authorities’ approval, Indochina Land Holdings (ILH), an affiliate of Indochina Capital, is to set up a joint venture for the investment project.
Further information on the project was not given.
As proposed, the newly-upgraded yacht wharf will provide international-standard seawater sport and rescue activities in case of emergency.
And the commercial-tourism complex will comprise of villas and high-end apartments along side Son Tra – Dien Ngoc beach for rent or sale, along with shopping malls and other facilities.
Indochina Capital, listed with the ticker symbol ICV on the London Stock Exchange earlier this month, have investments in the country and region valued at over 1 billion US$.
In related news, the first modern commercial area in Da Nang city, the Riverside Mall invested by ILH is set to open in November.
The 6,600 sq.m mall is home to garment, cosmetics, footwear, home appliances and food retailers.
The mall is located on the first three floors of the multi-purpose project Indochina Riverside Towers.
An international real estate consultancy service firm, CBRE, the sole marketing agent for the project, said that 50% of the mall had already been booked by clients and the rate would go up to at least 80% by opening time.
Source: Thanh Nien
Sunday, March 18, 2007
Agribank and AB Bank form strategic alliance
The State-owned Agribank and joint stock An Binh Bank (AB Bank) will now play for the same team thanks to a strategic partnership agreement signed on Mar. 15.
Under the agreement, the two banks will assist each other with international settlements, credit matters, foreign currency activities and securities trading, among others.
"Agribank, one of Viet Nam 's largest banks, will support us with capital and credit line so we can fund major power industry projects," said AB Bank general director Luu Duc Khanh.
AB Bank will also be able to tap Agribank's wide network of around 2,000 branches and transaction offices natiowide. Agribank also has around 950 bank agents in 113 countries.
Additionally, Agribank will have the right to buy AB Bank's shares and invest in its affiliates.
As well, AB Bank plans to set up a real estate and financial leasing company soon.
Electricity of Vietnam (EVN) is a major shareholder in the joint stock bank, whose equity capital stands at 1,131 trillion VND (77mio US$).
Under the agreement, the two banks will assist each other with international settlements, credit matters, foreign currency activities and securities trading, among others.
"Agribank, one of Viet Nam 's largest banks, will support us with capital and credit line so we can fund major power industry projects," said AB Bank general director Luu Duc Khanh.
AB Bank will also be able to tap Agribank's wide network of around 2,000 branches and transaction offices natiowide. Agribank also has around 950 bank agents in 113 countries.
Additionally, Agribank will have the right to buy AB Bank's shares and invest in its affiliates.
As well, AB Bank plans to set up a real estate and financial leasing company soon.
Electricity of Vietnam (EVN) is a major shareholder in the joint stock bank, whose equity capital stands at 1,131 trillion VND (77mio US$).
Power shortage perils FDI target
A shortage of electricity in Vietnam could impede the country’s target of 20 billion US$ in Foreign Direct Investment this year, a Vietnamese expert has said.
Doctor Le Dang Doanh of the Ministry of Planning and Investment said plans for power cuts by dominant state-run utility firm Electricity of Vietnam (EVN) could serve to dampen investment possibilities.
EVN, which said last month Vietnam may face a shortfall of nearly 1 billion Kwh this dry season, is now purchasing around 2% of its total electricity output from China.
He suggested state-owned power firms go public as soon as possible so that they will be more efficient in generating electricity to avert the shortage.
Not only FDI, but the country’s targeted economic growth rate of 8.5% would unlikely to be realized if the shortage goes on.
He also said that stabilizing the overheated stock market – whose benchmark index has soared over 1,000 points – is critical towards fulfilling the two targets.
Source: Thanh Nien
Doctor Le Dang Doanh of the Ministry of Planning and Investment said plans for power cuts by dominant state-run utility firm Electricity of Vietnam (EVN) could serve to dampen investment possibilities.
EVN, which said last month Vietnam may face a shortfall of nearly 1 billion Kwh this dry season, is now purchasing around 2% of its total electricity output from China.
He suggested state-owned power firms go public as soon as possible so that they will be more efficient in generating electricity to avert the shortage.
Not only FDI, but the country’s targeted economic growth rate of 8.5% would unlikely to be realized if the shortage goes on.
He also said that stabilizing the overheated stock market – whose benchmark index has soared over 1,000 points – is critical towards fulfilling the two targets.
Source: Thanh Nien
Saturday, March 17, 2007
Consumer spending to reach 53 billion US$ in 2010
Consumer spending is estimated to reach 840-860 trillion VND (53 billion US$D) by 2010, according to the Ministry of Trade.
For the past 10 years, the figure has average about 70% of the country's GDP per year, the ministry said, a high level compared to neighbours like Singapore (55.9%), Malaysia (58.2%) and Thailand (67.7%).
The ministry predicted the ratio would remain at around 70% through 2020 as the nation gives the priority to promoting investment and exports.
Retail goods will account for about 80% of consumer spending during 2006-10, when average expenditure per capita is expected to grow at about 10.5% per year.
By 2010, the average consumer spending per capita will be 657,800 VND, climbing to 1.1 million VND in urban areas, compared to 537,400 VND in rural areas.
The ministry believed that demand for entertainment would increase along with disposable incomes. Spending on healthcare, housing, transportation, and education would also grow apace, the ministry opined.
Retail spending on luxury goods was predicted to increase 5%, with the nation witnessing a growing popularity of upscale and more fashionable shops and shopping centres.
Demand for electricity and consumer electronics goods was expected to expand in rural areas, the ministry said.
Source: VNA
For the past 10 years, the figure has average about 70% of the country's GDP per year, the ministry said, a high level compared to neighbours like Singapore (55.9%), Malaysia (58.2%) and Thailand (67.7%).
The ministry predicted the ratio would remain at around 70% through 2020 as the nation gives the priority to promoting investment and exports.
Retail goods will account for about 80% of consumer spending during 2006-10, when average expenditure per capita is expected to grow at about 10.5% per year.
By 2010, the average consumer spending per capita will be 657,800 VND, climbing to 1.1 million VND in urban areas, compared to 537,400 VND in rural areas.
The ministry believed that demand for entertainment would increase along with disposable incomes. Spending on healthcare, housing, transportation, and education would also grow apace, the ministry opined.
Retail spending on luxury goods was predicted to increase 5%, with the nation witnessing a growing popularity of upscale and more fashionable shops and shopping centres.
Demand for electricity and consumer electronics goods was expected to expand in rural areas, the ministry said.
Source: VNA
SMC inaugurates steels factory
The SMC Investment Trading Joint Stock Company (SMC.VSE) )inaugurated a 44 billion VND (2.75mio US$) steel factory in Phu My 1 Industrial Park (IP) in the southern coastal province of Ba Ria-Vung Tau on Mar. 16.
Covering 2.1 hectares, the SMC Phu My Steel Factory has an annual output of 30,000 tonnes of products which are used in construction, shipbuilding, bridge engineering and electrical industries.
SMC is also carrying out a project worth 200 billion VND (12.5mio US$) to build a mechanical manufacturing factory in the Phu My 1 IP.
The project is expected to become operational in late 2008 to meet growing demands for mechanical-steel products both at home and abroad.
The company sold 250,000 tonnes of steel last year and has targeted to hold 4.5-5% of the domestic market share by 2010 (around 450,000-500,000 tonnes).
Source: VNA
Covering 2.1 hectares, the SMC Phu My Steel Factory has an annual output of 30,000 tonnes of products which are used in construction, shipbuilding, bridge engineering and electrical industries.
SMC is also carrying out a project worth 200 billion VND (12.5mio US$) to build a mechanical manufacturing factory in the Phu My 1 IP.
The project is expected to become operational in late 2008 to meet growing demands for mechanical-steel products both at home and abroad.
The company sold 250,000 tonnes of steel last year and has targeted to hold 4.5-5% of the domestic market share by 2010 (around 450,000-500,000 tonnes).
Source: VNA
Friday, March 16, 2007
Changes in the OTC market
There will be a lot of changes relating to several hundreds share items being transacted on the OTC (over the counter) market, when public companies have to follow the regulations on registration, information exposure and securities deposit as required by the Securities Law.
According to the Securities Law, there are three groups of public companies, including the companies that 1. have offered shares to the public 2. have listed on the bourse and 3. have at least 100 shareholders, not including the professional financial institutions, and have the contributed chartered capital of VND 10bil (0.62mio US$) at least.
The companies belonging to the third group must register to the competent authorities within 90 days since the day of becoming public companies. With this regulation, nearly all enterprises and banks, that have shares traded on the OTC market, are public companies. The Ministry of Finance has hurried public securities to register in March.
Public companies must expose periodic and unscheduled information as required by the Securities Law, and must seek permissions when issuing shares, deposit securities at depository centres, and follow the principles on companies’ governance stipulated by the Enterprise Law and circulars by the Ministry of Finance.
The shareholders, who hold more than 5% of shares, must report when they make the transactions that can change the share ownership in public companies by 1%. Public companies will be punished if they violate the regulations of the Securities Law.
Once the shares are deposited at the depository centre, the transfer of shares to be carried out by the companies or agents (securities companies) would be considered unlawful. The shares will only be transferred after they are deposited, and the ownership of the buyers will only be recognised by depository centre.
The requirement on depositing shares would lead to the big change in the OTC market. From now on, the transactions of OTC shares would be simpler and quicker. OTC shares will also have codes and be transacted through the accounts opened at securities companies like listing shares.
It is expected that securities companies will pay more attention to providing services relating to OTC shares, while freelance brokers will have no job to do. Making transactions through the depository centre will also help successfully control the transactions of shareholders, which will serve the taxation in the future. It is estimated that before the law on PIT (personal income tax) comes into effect in 2009, there will be a big wave of share assignment to avoid tax.
Analysts said that public companies all will list on the bourse, as the responsibilities they must fulfil are similar to the responsibilities of listing companies.
Source: VEN
According to the Securities Law, there are three groups of public companies, including the companies that 1. have offered shares to the public 2. have listed on the bourse and 3. have at least 100 shareholders, not including the professional financial institutions, and have the contributed chartered capital of VND 10bil (0.62mio US$) at least.
The companies belonging to the third group must register to the competent authorities within 90 days since the day of becoming public companies. With this regulation, nearly all enterprises and banks, that have shares traded on the OTC market, are public companies. The Ministry of Finance has hurried public securities to register in March.
Public companies must expose periodic and unscheduled information as required by the Securities Law, and must seek permissions when issuing shares, deposit securities at depository centres, and follow the principles on companies’ governance stipulated by the Enterprise Law and circulars by the Ministry of Finance.
The shareholders, who hold more than 5% of shares, must report when they make the transactions that can change the share ownership in public companies by 1%. Public companies will be punished if they violate the regulations of the Securities Law.
Once the shares are deposited at the depository centre, the transfer of shares to be carried out by the companies or agents (securities companies) would be considered unlawful. The shares will only be transferred after they are deposited, and the ownership of the buyers will only be recognised by depository centre.
The requirement on depositing shares would lead to the big change in the OTC market. From now on, the transactions of OTC shares would be simpler and quicker. OTC shares will also have codes and be transacted through the accounts opened at securities companies like listing shares.
It is expected that securities companies will pay more attention to providing services relating to OTC shares, while freelance brokers will have no job to do. Making transactions through the depository centre will also help successfully control the transactions of shareholders, which will serve the taxation in the future. It is estimated that before the law on PIT (personal income tax) comes into effect in 2009, there will be a big wave of share assignment to avoid tax.
Analysts said that public companies all will list on the bourse, as the responsibilities they must fulfil are similar to the responsibilities of listing companies.
Source: VEN
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