Pha Lai Thermal Power Co. (PPC), Vietnam's third-largest listed company, will auction more than 85 million state-held shares to reduce government ownership of the firm, market regulators said.
The State Securities Commission said in a statement it had allowed the firm to auction shares held by state utility Vietnam Electricity (EVN) representing a 27.4% stake in Pha Lai.
The sale would reduce state ownership of Pha Lai to 51% from 78.4%. The statement, seen on Thursday, did not say how much the auction was expected to raise and PPC has yet to announce details of the sale.
The stock closed flat at 95,000 Vietnam Dong on Feb. 15, the last trading day before Vietnam closed the stock market from Feb. 16 to Feb. 23 for the Lunar New Year holiday.
The sale of EVN shares in PPC is part of EVN's plan to divest ownership in smaller power plants to raise funds for new projects.
The Industry Ministry said last month unlisted ENV would invest 2.63 billion US$ in power generation and grids this year, 23.4% more than in 2006, to meet soaring industrial and consumer demand.
PPC made its debut last month on the Ho Chi Minh City Securities Trading Center, Vietnam's main stock market, after moving its listing from the Hanoi over-the-counter market.
With a market capitalisation of 29.52 trillion dong (1.84 billion US$), the company is the third-largest listed after information technology firm FPT (FPT) and top dairy product maker Vinamilk (VNM).
PPC's two power plants in the northern province of Hai Duong, 65 km (40 miles) east of Hanoi, have a combined capacity of 1,040 megawatts. They produce nearly 6 billion kilowatt hours of electricity per year, 10% of Vietnam's output.
Source: Reuters
Thursday, February 22, 2007
SSC fails in penalising brokers
A series of violations of regulations by securities brokerages has many investors wondering out loud why the State Securities Commission has only required these firms to correct violating practices without imposing any sanctions or penalties.
The commission has yet to mete out any punishment in any of these cases, only requiring securities companies to change their behaviour.
For example, the Vietcombank in-house brokerage, Vietcombank Securities, was found guilty of six infractions but only requested to amend order procedures and stop direct trading by certain investors.
Asia Commercial Bank subsidiary ACB Securities was told to stop allowing investors from using stock collateral between the time shares are bought to the termination date.
Le Thanh, an investor on the bourse and client of Vietcombank Securities, said that he felt angry when placing stock buy or sell orders, knowing the broker would place larger institutional orders in the queue ahead of him.
The brokerage firm needed to be aware of its capacity to supply services, Thanh said. If the firm could not satisfy investor demands, he wondered, why was it still opening new accounts?.
Hoang Duc Long, director of the State Securities Commission’s Investigative Department, could not offer a reasonable explanation for the commission’s laxity in handling brokerage violations.
Thanh reckoned that the commission should strictly penalise Vietcombank Securities for its violations to ensure a fair market environment and maintain investor confidence in the nation’s stock market.
However, a newly-issued decree providing regulations guiding implementation of the Securities Law does not specify punishment levels for specific illegal practices.
A financial expert said that it was undeniable that securities firms were making mistakes but, to some extent, these were a natural aspect of the evolution of the stock market. The blame also lied in part with the administrative systems of the authorities.
For instance, the software used by the HCM City Securities Trading Centre has not been updated in seven years and matches orders in three phases, creating bottlenecks during active trading.
In light of the problems, the Prime Minister recently requested the Ministry of Finance, in co-ordination with other ministries and sectors, to formulate a proposal in the first quarter of this year for the establishment of an authorised body independent of the Securities Commission and the State Bank of Viet Nam to supervise activities on the stock and monetary markets.
One of the main functions of the body would be to supervise trading activities on stock exchanges and activities of securities firms such as brokerage and consulting, as well as ensure compliance with securities deposit procedures and payment procedures.
Nguyen Hoang Hai, general secretary of the Viet Nam Association of Financial Investors, said that it was suitable and necessary to establish an indepenent supervisory body. Countries like Singapore, Japan, and South Korea also have such organisations.
The State Securities Commission has not fulfilled its function as a market regulator, and recent investigations of unlawful practices on the market were conducted were due to the pressure of public opinion rather than at the initiative of the commission.
Nguyen Van Dung, deputy director of the Ha Noi Securities Trading Centre, also agreed with the need to establish a powerful, functional organisation to monitor the market, to keep a close watch on market performance and capital circulation on the market.
Source: VNS
The commission has yet to mete out any punishment in any of these cases, only requiring securities companies to change their behaviour.
For example, the Vietcombank in-house brokerage, Vietcombank Securities, was found guilty of six infractions but only requested to amend order procedures and stop direct trading by certain investors.
Asia Commercial Bank subsidiary ACB Securities was told to stop allowing investors from using stock collateral between the time shares are bought to the termination date.
Le Thanh, an investor on the bourse and client of Vietcombank Securities, said that he felt angry when placing stock buy or sell orders, knowing the broker would place larger institutional orders in the queue ahead of him.
The brokerage firm needed to be aware of its capacity to supply services, Thanh said. If the firm could not satisfy investor demands, he wondered, why was it still opening new accounts?.
Hoang Duc Long, director of the State Securities Commission’s Investigative Department, could not offer a reasonable explanation for the commission’s laxity in handling brokerage violations.
Thanh reckoned that the commission should strictly penalise Vietcombank Securities for its violations to ensure a fair market environment and maintain investor confidence in the nation’s stock market.
However, a newly-issued decree providing regulations guiding implementation of the Securities Law does not specify punishment levels for specific illegal practices.
A financial expert said that it was undeniable that securities firms were making mistakes but, to some extent, these were a natural aspect of the evolution of the stock market. The blame also lied in part with the administrative systems of the authorities.
For instance, the software used by the HCM City Securities Trading Centre has not been updated in seven years and matches orders in three phases, creating bottlenecks during active trading.
In light of the problems, the Prime Minister recently requested the Ministry of Finance, in co-ordination with other ministries and sectors, to formulate a proposal in the first quarter of this year for the establishment of an authorised body independent of the Securities Commission and the State Bank of Viet Nam to supervise activities on the stock and monetary markets.
One of the main functions of the body would be to supervise trading activities on stock exchanges and activities of securities firms such as brokerage and consulting, as well as ensure compliance with securities deposit procedures and payment procedures.
Nguyen Hoang Hai, general secretary of the Viet Nam Association of Financial Investors, said that it was suitable and necessary to establish an indepenent supervisory body. Countries like Singapore, Japan, and South Korea also have such organisations.
The State Securities Commission has not fulfilled its function as a market regulator, and recent investigations of unlawful practices on the market were conducted were due to the pressure of public opinion rather than at the initiative of the commission.
Nguyen Van Dung, deputy director of the Ha Noi Securities Trading Centre, also agreed with the need to establish a powerful, functional organisation to monitor the market, to keep a close watch on market performance and capital circulation on the market.
Source: VNS
Techcombank forecasts revenues
Techcombank projects pre-tax profits this year of VND500 billion (31mio US$) , according to the bank’s general director, Nguyen Duc Vinh.
The bank would also raise its chartered capital to VND3 trillion (186mio US$) by the end of the year, doubling the current level of VND1.5 trillion (93mio US$), Vinh said. It would also expand its current network of six branches and 40 transaction offices to a total of 120 offices nationwide this year.
Techcombank plans to continue focusing on individual customers and small- and medium-sized enterprises by developing new services and products, he added.
To improve business performance, the bank would implement the Temenos 24 core banking software system which would form a firm foundation for the bank to develop new products and provide a higher quality service.
Earlier this month, HSBC reached an agreement with Techcombank to acquire an additional 10% of shares in the bank once the State Bank of Viet Nam approves the deal.
Under current regulations, a single foreign institution can only hold as much as 10% in a domestic bank, and HSBC already holds a 10% share in the bank. HSBC was waiting for the State Bank to change the regulation and lift the foreign ownership ceiling to 20%.
HSBC has already formed a strategic partnership with Techcombank, assisting the latter in corporate governance, technical support and risk management.
Vinh said that co-operation with a foreign bank was effective if the local bank itself was willing to look carefully into all aspects of banking operations from technology to human resources.
Techcombank has defined HSBC as its exclusive strategic partner and does not plan to enter into a relationship with an additional foreign or domestic partner, Vinh noted.
Source: VNS
The bank would also raise its chartered capital to VND3 trillion (186mio US$) by the end of the year, doubling the current level of VND1.5 trillion (93mio US$), Vinh said. It would also expand its current network of six branches and 40 transaction offices to a total of 120 offices nationwide this year.
Techcombank plans to continue focusing on individual customers and small- and medium-sized enterprises by developing new services and products, he added.
To improve business performance, the bank would implement the Temenos 24 core banking software system which would form a firm foundation for the bank to develop new products and provide a higher quality service.
Earlier this month, HSBC reached an agreement with Techcombank to acquire an additional 10% of shares in the bank once the State Bank of Viet Nam approves the deal.
Under current regulations, a single foreign institution can only hold as much as 10% in a domestic bank, and HSBC already holds a 10% share in the bank. HSBC was waiting for the State Bank to change the regulation and lift the foreign ownership ceiling to 20%.
HSBC has already formed a strategic partnership with Techcombank, assisting the latter in corporate governance, technical support and risk management.
Vinh said that co-operation with a foreign bank was effective if the local bank itself was willing to look carefully into all aspects of banking operations from technology to human resources.
Techcombank has defined HSBC as its exclusive strategic partner and does not plan to enter into a relationship with an additional foreign or domestic partner, Vinh noted.
Source: VNS
Ministry of Industry publishes planned investments
Food processing and consumer goods companies plan to invest about VND6.91 trillion (431.9mio US$) to implement new projects this year, according to the Ministry of Industry.
Under the planned investments, there are large-scale projects such as the second phase of the Bai Bang Paper Company; construction of two breweries, each able to make 100 million litres of beer a year; and capacity expansion by the Viet Nam Garment and Textile Corporation.
The Ministry of Industry has suggested that companies accelerate development efforts and take the initiative to look for new capital resources, as well as reduce construction investment risks. Investors also need to focus on the new projects aimed at modernising the industry, say officials.
In the past, investments have not ended in positive results due to difficulties with land clearance and insufficient capital resources, according to the ministry.
The country’s industrial output in January was estimated at VND46.15 trillion (2.88 billion US$), up 26 per cent over the same period last year.
Source: VNS
Under the planned investments, there are large-scale projects such as the second phase of the Bai Bang Paper Company; construction of two breweries, each able to make 100 million litres of beer a year; and capacity expansion by the Viet Nam Garment and Textile Corporation.
The Ministry of Industry has suggested that companies accelerate development efforts and take the initiative to look for new capital resources, as well as reduce construction investment risks. Investors also need to focus on the new projects aimed at modernising the industry, say officials.
In the past, investments have not ended in positive results due to difficulties with land clearance and insufficient capital resources, according to the ministry.
The country’s industrial output in January was estimated at VND46.15 trillion (2.88 billion US$), up 26 per cent over the same period last year.
Source: VNS
Petrolimex forecasts revenues for 2007
Viet Nam National Petroleum Corporation (Petrolimex) is forecasting revenues of VND64.8 trillion (4.05 billion US$) this year, says the company’s Deputy General Director Bui Ngoc Bao.
The corporation, on such revenues, could earn VND565 billion (35.31mio US$) and contribute VND10.85 trillion (678.13mio US$) to the national budget, Bao added.
He also expects the company to import a total of 8.18 million tonnes of gasoline, equalling the total output in annual sales this year. This represents an increase of 5.1% last year.
The volume of petrol sold at home would increase by 6% to reach 7.18 million tonnes. The remaining one million tonnes would be re-exported.
The corporation aims to ensure domestic demand will be met as part of its efforts to stabilise the domestic petrol market, said Bao.
To achieve the goals for 2007, he said, the corporation must closely follow domestic and world oil market developments and tightly co-ordinate with major petrol importers and relevant agencies to manage petrol trading and trading policies.
The company also looks to fine-tune its financial controls and increase investment in its infrastructure.
According to Bao, Petrolimex is being reorganised for conversion into a parent company with various subsidiaries. The result will be Petrolimex Economic Corporation by 2010.
Bao suggested that the Goverment considers tightening rules under which enterprises would be authorised to deal in petrol. The number of general agents should be reduced to make supervision easier, he believes, and to assist that remaining agents meet safety and environmental standards. Small fuel stations may eventually be abolished.
Bao also suggested the Goverment fixes schedules to collect import duties (after six or twelve months) to make it easier for enterprises to work out long-term business plans and produce stable incomes for the national budget.
The Government should soon authorise enterprises to fix petrol prices, he said. It should intervene in the petrol market with administrative and economic measures only when the world petrol prices see great fluctuation that could harm the national economy.
Ministries and sectors should work out price adjustment plans to submit to the Goverment for consideration at the beginning of each year or every six months, he said.
Bao suggested increasing national petrol reserves, which could be used to stabilise the market when it becomes especially volatile.
Source: VNS
The corporation, on such revenues, could earn VND565 billion (35.31mio US$) and contribute VND10.85 trillion (678.13mio US$) to the national budget, Bao added.
He also expects the company to import a total of 8.18 million tonnes of gasoline, equalling the total output in annual sales this year. This represents an increase of 5.1% last year.
The volume of petrol sold at home would increase by 6% to reach 7.18 million tonnes. The remaining one million tonnes would be re-exported.
The corporation aims to ensure domestic demand will be met as part of its efforts to stabilise the domestic petrol market, said Bao.
To achieve the goals for 2007, he said, the corporation must closely follow domestic and world oil market developments and tightly co-ordinate with major petrol importers and relevant agencies to manage petrol trading and trading policies.
The company also looks to fine-tune its financial controls and increase investment in its infrastructure.
According to Bao, Petrolimex is being reorganised for conversion into a parent company with various subsidiaries. The result will be Petrolimex Economic Corporation by 2010.
Bao suggested that the Goverment considers tightening rules under which enterprises would be authorised to deal in petrol. The number of general agents should be reduced to make supervision easier, he believes, and to assist that remaining agents meet safety and environmental standards. Small fuel stations may eventually be abolished.
Bao also suggested the Goverment fixes schedules to collect import duties (after six or twelve months) to make it easier for enterprises to work out long-term business plans and produce stable incomes for the national budget.
The Government should soon authorise enterprises to fix petrol prices, he said. It should intervene in the petrol market with administrative and economic measures only when the world petrol prices see great fluctuation that could harm the national economy.
Ministries and sectors should work out price adjustment plans to submit to the Goverment for consideration at the beginning of each year or every six months, he said.
Bao suggested increasing national petrol reserves, which could be used to stabilise the market when it becomes especially volatile.
Source: VNS
Korean experts warn: Vietnamese stock market overheated!
As retail investors from the Republic of Korea flock to the Vietnamese stock market, fund managers and financial regulators in that country fear they may be managing their risks poorly.
These investors faced possible losses once speculative money exited the booming market, the experts warned.
The Vietnamese market has seen exponential growth in the last couple of years. It has come to a head with the combined market capitalization of the Ho Chi Minh City and the Hanoi stock markets jumping from 12.8 billion US$ at the end of 2006 to 20.3 billion US$ by the first week of February this year.
The HCMC exchange’s VN-Index went up from about 400 in July 2006 to 750 by the end of the year.
The experts attributed the growth to increasing equitization of state-owned enterprises, but also noted that the price-to-earnings valuation of Vietnamese shares had also jumped substantially.
Vietnamese shares are traded at an average price earnings of 40 to 50, compared to the benchmark Korea Composite Stock Index's 11, and Samsung Electronics Co.'s 13.
While listed Vietnamese companies were seeing a steep net earnings growth – with the HCMC exchange's average listed company seeing a 73.56% growth last year – many South Korean experts were concerned about the sheer pace of this growth.
Of the 25.6 billion US$ South Koreans have invested in overseas securities, nearly 1.06 billion US$ are Vietnam-related.
"Emerging markets are typically volatile, and the Vietnam market in particular grew substantially in a short period of time," Choi Sang-gil, executive director at the fund tracker Zeronin, said.
"I wouldn't deny that in the long-term, the Vietnamese market is promising, but in the short-term, there is a high possibility of a correction. The market is still in its infancy, and has not been tested yet. And there are plenty of factors that could swing the market," he warned.
Following a recent warning by the Financial Supervisory Service on Vietnam equities investment, a number of local asset managers including the Vietnam fund pioneer Korea Investment & Securities, said they would no longer be opening a new Vietnam fund for the time being.
"The VN index jumped 38.5% this year, there is no doubt about its being overheated," a Mirae Asset Group official said.
Source: Thanh Nien
These investors faced possible losses once speculative money exited the booming market, the experts warned.
The Vietnamese market has seen exponential growth in the last couple of years. It has come to a head with the combined market capitalization of the Ho Chi Minh City and the Hanoi stock markets jumping from 12.8 billion US$ at the end of 2006 to 20.3 billion US$ by the first week of February this year.
The HCMC exchange’s VN-Index went up from about 400 in July 2006 to 750 by the end of the year.
The experts attributed the growth to increasing equitization of state-owned enterprises, but also noted that the price-to-earnings valuation of Vietnamese shares had also jumped substantially.
Vietnamese shares are traded at an average price earnings of 40 to 50, compared to the benchmark Korea Composite Stock Index's 11, and Samsung Electronics Co.'s 13.
While listed Vietnamese companies were seeing a steep net earnings growth – with the HCMC exchange's average listed company seeing a 73.56% growth last year – many South Korean experts were concerned about the sheer pace of this growth.
Of the 25.6 billion US$ South Koreans have invested in overseas securities, nearly 1.06 billion US$ are Vietnam-related.
"Emerging markets are typically volatile, and the Vietnam market in particular grew substantially in a short period of time," Choi Sang-gil, executive director at the fund tracker Zeronin, said.
"I wouldn't deny that in the long-term, the Vietnamese market is promising, but in the short-term, there is a high possibility of a correction. The market is still in its infancy, and has not been tested yet. And there are plenty of factors that could swing the market," he warned.
Following a recent warning by the Financial Supervisory Service on Vietnam equities investment, a number of local asset managers including the Vietnam fund pioneer Korea Investment & Securities, said they would no longer be opening a new Vietnam fund for the time being.
"The VN index jumped 38.5% this year, there is no doubt about its being overheated," a Mirae Asset Group official said.
Source: Thanh Nien
Indochina Capital seeks London listing for Vietnam vehicle
Indochina Capital Vietnam Holdings aims to raise at least 325mio US$, but may increase the offering to 500mio US$.
One might question whether there will ever be a wrong time to launch a Vietnamese investment opportunity, given how “hot” the country currently is in the eyes of international investors.
Still, a new investment company focused on Vietnam to be listed by Indochina Capital Corporation in London on March 2 has timed its public debut well.
Having started marketing this week, the offering comes just weeks after Vietnam entered the World Trade Organization and at a time when the economy continues to fire on all cylinders - economists are forecasting 8% GDP growth both this year and next.
Add to this a wave of expected equitization of major state-owned enterprises this year, and the limited investment opportunities available, and it’s not hard to imagine a flurry of investor demand.
The Vietnamese stock market was already the best performer in Asia last year with a 144% gain and it has added another 44% so far this year.
At 10 billion US$, its total market capitalization is still tiny so the growth comes from a low base, but many market participants project the market will again double in size during the course of this year.
Indochina Capital Vietnam Holdings will be structured as a closed-end investment company and will invest in equities listed on the Ho Chi Minh Stock Exchange, over-the-counter stocks, private equity and potentially some derivatives and debt securities.
It can also invest in non-Vietnamese companies which have a material portion of their business or assets in Vietnam.
There are already eight other Vietnam-focused funds or investment companies listed on London’s Alternative Investment Market or in Dublin, but this will be the first to list on London’s main board.
That should be an advantage given that it is a much more liquid market, allowing investors greater possibilities to trade in and out.
“There still are restrictions on foreigners going into Vietnam directly so these vehicles do provide access and if you consider the expected economic growth and the equitization program, the country can clearly absorb the 1 billion to 2 billion US$ that has been raised so far through various opportunity funds,” one observer says with regard to the potential interest.
Indochina Capital Vietnam, which is marketing itself as a growth play, intends to raise 325mio US$ to 350mio US$ through a share offer arranged by Credit Suisse.
According to an announcement published on the London Stock Exchange Web site, a majority of this will go to cornerstone investors which have already committed to buying a combined 225mio US$, meaning as little as 100mio US$ may be available to other investors.
A source familiar with the offering notes, however, that the board has the ability to increase the size of the IPO to a maximum 500mio US$, which could increase the portion available to non-cornerstone investors to as much as 275mio US$.
And in case of very strong demand, one or two of the up to seven cornerstones may also see their allocations scaled back somewhat, the source says.
Still, a key risk with an investment company like this that has committed none of its money at the time of listing is that it will take time to put the whole cash pool to work.
This is especially true for a small and illiquid market like Vietnam and investors will be keenly aware that the longer the a portion of the cash stays idle, the lower the potential return on equity is likely to be.
Consequently, Indochina Capital wouldn’t want to raise “too much” in one go, the source says, adding: “You cannot put it all to work over night and you can always come back to the market.”
The shares will be offered at a fixed price of 10 US$ apiece and as the company will have no debt at the time of listing, the offer price will also be equal to the net asset value.
In turn this means the vehicle will be sold at par, which makes it looks cheap compared with some of the other listed Vietnam funds that tend to trade at premiums to NAV of between 35% and as much as 50%.
Investors who have met with the sponsors in the first few days of the roadshow also like the fee structure, which they say is slightly lower than for the major comps, and the experience of the management team.
The latter includes Chairman Miles Morland, the founder of Blakeney Management which is one of the pioneers of investing in Africa and the Middle East and specializes in investments into “inefficient” stock markets.
Indochina Capital, which will be the manager of the investment company through its wholly-owned subsidiary Indochina Capital Advisers, has a seven-year track record of investing in Vietnam on a proprietary basis and its two founding principles have been active in the Vietnamese market for 14 years. The company also has a private equity fund focused on Vietnamese real estate.
Marc Faber, a Hong Kong-based investor known as much for his investment prowess as for his Gloom, Boom & Doom Report, is a member of the firm’s advisory committee.
The strong interest in Vietnam and other “new” growth markets was evident when Merrill Lynch organized its second annual conference focused on Pakistan, Vietnam, Sri Lanka and Mongolia – or the New Frontier markets, as the bank calls them.
The three-day conference, which was held in Singapore just before the Chinese New Year holidays attracted more than 100 investors and saw more than 700 one-on-one meetings.
In a note summing up its views on these markets, Merrill argues that Vietnam’s key selling argument is its large population of close to 90 million.
The bank also likes the country’s ability to compete against China in manufacturing and its strong government and free market policies.
However, the hefty rise in the past year has left the Vietnam stock market almost three times as expensive as Pakistan, which leads its strategist team to project that among the four, Pakistan will be the outperformer this year.
Source: Thanh Nien
One might question whether there will ever be a wrong time to launch a Vietnamese investment opportunity, given how “hot” the country currently is in the eyes of international investors.
Still, a new investment company focused on Vietnam to be listed by Indochina Capital Corporation in London on March 2 has timed its public debut well.
Having started marketing this week, the offering comes just weeks after Vietnam entered the World Trade Organization and at a time when the economy continues to fire on all cylinders - economists are forecasting 8% GDP growth both this year and next.
Add to this a wave of expected equitization of major state-owned enterprises this year, and the limited investment opportunities available, and it’s not hard to imagine a flurry of investor demand.
The Vietnamese stock market was already the best performer in Asia last year with a 144% gain and it has added another 44% so far this year.
At 10 billion US$, its total market capitalization is still tiny so the growth comes from a low base, but many market participants project the market will again double in size during the course of this year.
Indochina Capital Vietnam Holdings will be structured as a closed-end investment company and will invest in equities listed on the Ho Chi Minh Stock Exchange, over-the-counter stocks, private equity and potentially some derivatives and debt securities.
It can also invest in non-Vietnamese companies which have a material portion of their business or assets in Vietnam.
There are already eight other Vietnam-focused funds or investment companies listed on London’s Alternative Investment Market or in Dublin, but this will be the first to list on London’s main board.
That should be an advantage given that it is a much more liquid market, allowing investors greater possibilities to trade in and out.
“There still are restrictions on foreigners going into Vietnam directly so these vehicles do provide access and if you consider the expected economic growth and the equitization program, the country can clearly absorb the 1 billion to 2 billion US$ that has been raised so far through various opportunity funds,” one observer says with regard to the potential interest.
Indochina Capital Vietnam, which is marketing itself as a growth play, intends to raise 325mio US$ to 350mio US$ through a share offer arranged by Credit Suisse.
According to an announcement published on the London Stock Exchange Web site, a majority of this will go to cornerstone investors which have already committed to buying a combined 225mio US$, meaning as little as 100mio US$ may be available to other investors.
A source familiar with the offering notes, however, that the board has the ability to increase the size of the IPO to a maximum 500mio US$, which could increase the portion available to non-cornerstone investors to as much as 275mio US$.
And in case of very strong demand, one or two of the up to seven cornerstones may also see their allocations scaled back somewhat, the source says.
Still, a key risk with an investment company like this that has committed none of its money at the time of listing is that it will take time to put the whole cash pool to work.
This is especially true for a small and illiquid market like Vietnam and investors will be keenly aware that the longer the a portion of the cash stays idle, the lower the potential return on equity is likely to be.
Consequently, Indochina Capital wouldn’t want to raise “too much” in one go, the source says, adding: “You cannot put it all to work over night and you can always come back to the market.”
The shares will be offered at a fixed price of 10 US$ apiece and as the company will have no debt at the time of listing, the offer price will also be equal to the net asset value.
In turn this means the vehicle will be sold at par, which makes it looks cheap compared with some of the other listed Vietnam funds that tend to trade at premiums to NAV of between 35% and as much as 50%.
Investors who have met with the sponsors in the first few days of the roadshow also like the fee structure, which they say is slightly lower than for the major comps, and the experience of the management team.
The latter includes Chairman Miles Morland, the founder of Blakeney Management which is one of the pioneers of investing in Africa and the Middle East and specializes in investments into “inefficient” stock markets.
Indochina Capital, which will be the manager of the investment company through its wholly-owned subsidiary Indochina Capital Advisers, has a seven-year track record of investing in Vietnam on a proprietary basis and its two founding principles have been active in the Vietnamese market for 14 years. The company also has a private equity fund focused on Vietnamese real estate.
Marc Faber, a Hong Kong-based investor known as much for his investment prowess as for his Gloom, Boom & Doom Report, is a member of the firm’s advisory committee.
The strong interest in Vietnam and other “new” growth markets was evident when Merrill Lynch organized its second annual conference focused on Pakistan, Vietnam, Sri Lanka and Mongolia – or the New Frontier markets, as the bank calls them.
The three-day conference, which was held in Singapore just before the Chinese New Year holidays attracted more than 100 investors and saw more than 700 one-on-one meetings.
In a note summing up its views on these markets, Merrill argues that Vietnam’s key selling argument is its large population of close to 90 million.
The bank also likes the country’s ability to compete against China in manufacturing and its strong government and free market policies.
However, the hefty rise in the past year has left the Vietnam stock market almost three times as expensive as Pakistan, which leads its strategist team to project that among the four, Pakistan will be the outperformer this year.
Source: Thanh Nien
Wednesday, February 14, 2007
Vietnamese stock markets January performance
In January, securities from the securities trading centres in Hanoi and Ho Chi Minh City saw sharp increases in both volume and value, according to a report announced by the State Securities Commission of Vietnam.
At the Ho Chi Minh City Securities Trading Centre (HoSTC), the VN-Index stood at 725 points at the last trading session of December 2006. It climbed to 1,041 at the close on January 31, 2007, registering an average increase of 1.5% a day.
At the Hanoi Securities Trading Centre (HASTC), the HASTC-Index also increased consecutively. On January 2, it was 241.92 points and it reached 348.52 points on January 31, with an average growth of 1.8% a day.
The recent increase in prices of shares of listed companies started on December 27, 2006. At that time, the VN-Index was 751.77 and currently it exceeds over 1,000 points, up 140%. The market average P/E ratio is 43.24.
Of the 107 listed companies at the HoSTC, 17 has their P/E ratios bigger than the average ratio and more than half of them were shares of companies with sharp increases in prices. As many as 46 company shares have their P/E ratios bigger than 20 and the remaining 61 companies have their P/E ratio below 20.
At developed markets, the P/E ratio averages from 8-15. If this ratio is bigger than 20, the companies are marked to be good and investors expect the earnings per share of the company will increase sharply in the future.
Thus, the fact that 61 out of 107 listed companies have their P/E ratio lower than 20 is normal.
However, 17 out of these 107 companies have their P/E ratio bigger than the average P/E ratio of 43, shows that the market is showing signals of too high expectations. Especially, three companies have their P/E ratio bigger than 100. These include PVD (328), VIP (112) and HBC (162).
According to the SSC, the sharp growth of the stock market recently are due to the following reasons:
First, the overly high expectations of domestic and foreign investors in the securities market.
Secondly, the securities market is still new in Vietnam. Many investors are still influenced by demands from foreign investors.
Thirdly, some foreign and domestic investors are of the view that listed companies are mostly State-owned enterprises which have been equitised at an artificially at low price. Therefore, they hope that the price of these shares will remain cheap.
Fourthly, the sharp increase of shares of some listed companies is due to the fact that investors expect a sudden growth of some enterprises working in special sectors.
The last reason might be the capability that some big investors want to control the prices of some newly-listed shares.
Source: VNE
At the Ho Chi Minh City Securities Trading Centre (HoSTC), the VN-Index stood at 725 points at the last trading session of December 2006. It climbed to 1,041 at the close on January 31, 2007, registering an average increase of 1.5% a day.
At the Hanoi Securities Trading Centre (HASTC), the HASTC-Index also increased consecutively. On January 2, it was 241.92 points and it reached 348.52 points on January 31, with an average growth of 1.8% a day.
The recent increase in prices of shares of listed companies started on December 27, 2006. At that time, the VN-Index was 751.77 and currently it exceeds over 1,000 points, up 140%. The market average P/E ratio is 43.24.
Of the 107 listed companies at the HoSTC, 17 has their P/E ratios bigger than the average ratio and more than half of them were shares of companies with sharp increases in prices. As many as 46 company shares have their P/E ratios bigger than 20 and the remaining 61 companies have their P/E ratio below 20.
At developed markets, the P/E ratio averages from 8-15. If this ratio is bigger than 20, the companies are marked to be good and investors expect the earnings per share of the company will increase sharply in the future.
Thus, the fact that 61 out of 107 listed companies have their P/E ratio lower than 20 is normal.
However, 17 out of these 107 companies have their P/E ratio bigger than the average P/E ratio of 43, shows that the market is showing signals of too high expectations. Especially, three companies have their P/E ratio bigger than 100. These include PVD (328), VIP (112) and HBC (162).
According to the SSC, the sharp growth of the stock market recently are due to the following reasons:
First, the overly high expectations of domestic and foreign investors in the securities market.
Secondly, the securities market is still new in Vietnam. Many investors are still influenced by demands from foreign investors.
Thirdly, some foreign and domestic investors are of the view that listed companies are mostly State-owned enterprises which have been equitised at an artificially at low price. Therefore, they hope that the price of these shares will remain cheap.
Fourthly, the sharp increase of shares of some listed companies is due to the fact that investors expect a sudden growth of some enterprises working in special sectors.
The last reason might be the capability that some big investors want to control the prices of some newly-listed shares.
Source: VNE
Tuesday, February 13, 2007
Vietcombank will sell shares to foreign financial group
The Bank for Foreign Trade of Vietnam (Vietcombank) and Switzerland’s Credit Suisse yesterday signed the contract on equitisation consultancy services.
Under the contract, Credit Suisse will provide a package of services, including the solution to convert the bonds into shares, skills for corporate governance, bad debt management training, risk and asset management.
Speaking at the press conference held in Hanoi yesterday, Vu Viet Ngoan, Vietcombank’s Director General said that the bank has got the permission from the Government to choose a foreign strategic shareholder, to whom Vietcombank will sell 10% of its shares. The foreign strategic partner must be a world’s leading financial group, which is interested in Vietnam’s market.
Mr Ngoan said that under the consultancy of Credit Suisse, the IPO in the domestic market will be carried out in July 2007. The selection of strategic shareholder will be done in October 2007 and the IPO in the international market will be undertaken in 2008.
Mr Ngoan said that in the first phase of the equitisation, the state will remain the main shareholder with 70% of total capital. Only 10% of chartered capital will be available for every time of IPO. In the long term, the proportion of state owned shares in Vietcombank will decrease, but the state will still hold the controlling stake proportion of 51%.
In principle, Vietcombank may sell 20% of its stakes to foreign strategic shareholders at maximum, however, the deal must be approved by the Government.
Mr Ngoan has confirmed that Credit Suisse is the only financial consultant for Vietcombank in the equitisation process, and it will not become the strategic shareholder of Vietcombank.
On February 12, the world’s leading credit rating firm Standard & Poor’s announced it gave Vietcombank BB/B (stable outlook) in credit ranking. The rating given to Vietcombank is equivalent to the national credit rating. This is the highest ever credit rating given by Standard & Poor’s to a Vietnam-based financial institution.
Source: VNE
Under the contract, Credit Suisse will provide a package of services, including the solution to convert the bonds into shares, skills for corporate governance, bad debt management training, risk and asset management.
Speaking at the press conference held in Hanoi yesterday, Vu Viet Ngoan, Vietcombank’s Director General said that the bank has got the permission from the Government to choose a foreign strategic shareholder, to whom Vietcombank will sell 10% of its shares. The foreign strategic partner must be a world’s leading financial group, which is interested in Vietnam’s market.
Mr Ngoan said that under the consultancy of Credit Suisse, the IPO in the domestic market will be carried out in July 2007. The selection of strategic shareholder will be done in October 2007 and the IPO in the international market will be undertaken in 2008.
Mr Ngoan said that in the first phase of the equitisation, the state will remain the main shareholder with 70% of total capital. Only 10% of chartered capital will be available for every time of IPO. In the long term, the proportion of state owned shares in Vietcombank will decrease, but the state will still hold the controlling stake proportion of 51%.
In principle, Vietcombank may sell 20% of its stakes to foreign strategic shareholders at maximum, however, the deal must be approved by the Government.
Mr Ngoan has confirmed that Credit Suisse is the only financial consultant for Vietcombank in the equitisation process, and it will not become the strategic shareholder of Vietcombank.
On February 12, the world’s leading credit rating firm Standard & Poor’s announced it gave Vietcombank BB/B (stable outlook) in credit ranking. The rating given to Vietcombank is equivalent to the national credit rating. This is the highest ever credit rating given by Standard & Poor’s to a Vietnam-based financial institution.
Source: VNE
Vietcombank IPO this summer
State-run Bank for Foreign Trade (Vietcombank), Vietnam's second-largest bank, is expected to offer shares to the public in July or August and its domestic listing would follow within six to eight weeks, officials said.
Hanoi-based Vietcombank, along with Vietindebank, Incombank and the Mekong Delta Housing Development Bank, are four state-run banks ordered by the government to privatise partially in 2007.
Agribank, the country's largest bank, will follow in 2008 to complete part of the banking sector reform viewed by foreign investors as a test for the communist-run Southeast Asian country in realising commitments it made when joining the World Trade Organisation in January.
"We hope that in July or August the IPO of Vietcombank will be executed," Pham Viet Muon, deputy head of the Government Office, said on Monday, giving the bank's IPO timetable for the first time.
Muon was speaking shortly before Vietcombank signed a contract to hire global investment bank Credit Suisse to advise on its partial privatisation.
Source: Reuters
Hanoi-based Vietcombank, along with Vietindebank, Incombank and the Mekong Delta Housing Development Bank, are four state-run banks ordered by the government to privatise partially in 2007.
Agribank, the country's largest bank, will follow in 2008 to complete part of the banking sector reform viewed by foreign investors as a test for the communist-run Southeast Asian country in realising commitments it made when joining the World Trade Organisation in January.
"We hope that in July or August the IPO of Vietcombank will be executed," Pham Viet Muon, deputy head of the Government Office, said on Monday, giving the bank's IPO timetable for the first time.
Muon was speaking shortly before Vietcombank signed a contract to hire global investment bank Credit Suisse to advise on its partial privatisation.
Source: Reuters
Seafood exports expected to increase by 9.3%
Vietnamese seafood processing businesses are striving to earn an export turnover of 3.6 billion US$ in 2007, according to the Viet Nam Association of Seafood Exporters and Processors (VASEP).
The businesses, including large ones, Minh Phu, Camimex, Jostoco and Agifish, invested in modernising technologies to raise production capacity and diversify export items.
The fisheries sector will also help businesses improve their capacity of examining antibiotic residues in materials. Seafood export revenues were at 3.36 billion US$ in 2006, surpassing the yearly plan of 2.8 billion US$.
Source: VNA
The businesses, including large ones, Minh Phu, Camimex, Jostoco and Agifish, invested in modernising technologies to raise production capacity and diversify export items.
The fisheries sector will also help businesses improve their capacity of examining antibiotic residues in materials. Seafood export revenues were at 3.36 billion US$ in 2006, surpassing the yearly plan of 2.8 billion US$.
Source: VNA
Government bonds on auction
The Vietnam gov’t is set to auction 300 billion VND (18.8mio US$) in bonds February 26 at the Hanoi Securities Trading Center (HASTC), with funds to assist socio-economic development. The finance ministry forecast that government backed bonds would lure about 60-70 trillion VND (3.7- 4.3mio US$) annually in the near future.
The five-year bonds bear a face value of 100,000 VND and will be issued the State Treasury on February 28 and listed in the Hanoi bourse.
The government has successfully raised 500 billion VND (31mio US$) through a bond issue on also HASTC on February 5.
The five-year bonds, oversubscribed by nearly five times, have a coupon of 7.62% per annum.
The state treasury-issued report said Hanoi and Ho Chi Minh City had generated about 2.5 trillion VND (US$156 million), bringing municipal outstanding bond debt to 10 trillion VND($625 million) last year.
The development of a bond market has been viewed as an effective way to tap capital sources and also an important step in controlling inflation and currency fluctuation, the treasury said.
Foreign financiers said the debt market was still small compared to the regional exchanges in the Philippines, Malaysia and Singapore though the volume of government bonds has been increased since 2000.
They added that reforms were necessary to assist bond traders in accessing markets, tackling risks and controlling expenses.
The government should not be involved in setting price ceilings or interest rates, which limits the market’s competitiveness in the region.
The Ministry of Finance said recently it was restructuring the bond market to boost liquidity and transparency to attract investors and ensure funds for an economy growing at 8% a year.
Too many types of government bonds were now listed on the stock market and their small, fragmented nature limited the market’s development.
Starting this year, government bond issues would be larger and be traded on the Hanoi over-the-counter market.
The government planned to raise 500mio US$ to 1 billion US$ on the global bond market in the first quarter of this year, more than a year after raising 750mio US$ in its first sovereign bond issue.
The proceeds of the bond, with a maturity of 10 or 20 years, would be allocated to several companies, including Electricity of Vietnam, which too plans to issue global corporate bonds to raise 150mio US$.
Source: Thanh Nien
The five-year bonds bear a face value of 100,000 VND and will be issued the State Treasury on February 28 and listed in the Hanoi bourse.
The government has successfully raised 500 billion VND (31mio US$) through a bond issue on also HASTC on February 5.
The five-year bonds, oversubscribed by nearly five times, have a coupon of 7.62% per annum.
The state treasury-issued report said Hanoi and Ho Chi Minh City had generated about 2.5 trillion VND (US$156 million), bringing municipal outstanding bond debt to 10 trillion VND($625 million) last year.
The development of a bond market has been viewed as an effective way to tap capital sources and also an important step in controlling inflation and currency fluctuation, the treasury said.
Foreign financiers said the debt market was still small compared to the regional exchanges in the Philippines, Malaysia and Singapore though the volume of government bonds has been increased since 2000.
They added that reforms were necessary to assist bond traders in accessing markets, tackling risks and controlling expenses.
The government should not be involved in setting price ceilings or interest rates, which limits the market’s competitiveness in the region.
The Ministry of Finance said recently it was restructuring the bond market to boost liquidity and transparency to attract investors and ensure funds for an economy growing at 8% a year.
Too many types of government bonds were now listed on the stock market and their small, fragmented nature limited the market’s development.
Starting this year, government bond issues would be larger and be traded on the Hanoi over-the-counter market.
The government planned to raise 500mio US$ to 1 billion US$ on the global bond market in the first quarter of this year, more than a year after raising 750mio US$ in its first sovereign bond issue.
The proceeds of the bond, with a maturity of 10 or 20 years, would be allocated to several companies, including Electricity of Vietnam, which too plans to issue global corporate bonds to raise 150mio US$.
Source: Thanh Nien
Monday, February 12, 2007
VN-Index dropped before Tet
The market plunged Friday as investors offloaded shares ahead of the Lunar New Year holiday.
The VN-Index lost 21.96 points to close at 1,030.90.
Analysts explained that some investors bailed out to move cash into real estate which has signaled a recovery while a bubble seems to be building in the stock market since December.
Many blue chips lost. IT giant FPT fell by VND30,000 to VND574,000, confectioner Kinh Do Corp lost VND10,000 to close at VND204,000, and dairy biggie Vinamilk lost VND9,000 to close at VND181,000.
In contrast to the HCMC market, Hanoi gained 0.27 points Friday to close at 340.53.
Source: Thanh Nien
The VN-Index lost 21.96 points to close at 1,030.90.
Analysts explained that some investors bailed out to move cash into real estate which has signaled a recovery while a bubble seems to be building in the stock market since December.
Many blue chips lost. IT giant FPT fell by VND30,000 to VND574,000, confectioner Kinh Do Corp lost VND10,000 to close at VND204,000, and dairy biggie Vinamilk lost VND9,000 to close at VND181,000.
In contrast to the HCMC market, Hanoi gained 0.27 points Friday to close at 340.53.
Source: Thanh Nien
SSC found irregularities at security companies
The State Securities Commission (SSC) began a probe into Vietcombank Securities (VCBS), Ho Chi Minh City Securities (HSC), and ACB Securities belonging to Asia Commercial Bank following a stream of complaints from investors.
The investigation showed that VCBS gave priority to orders from certain individuals and institutions, putting them through whatever time they came and not following the stock market rules.
Besides, 13 of its 22 employees involved in securities trading were not formally qualified for the job.
HSC, though mostly following the rules, did not maintain proper records for transactions like custodial services, mortgages, and share transfers, while the dates on some records did not match those at the bourse.
ACB Securities was allowing investors to use their stocks as collateral even before they were transferred to their accounts.
Also, it carried out some of the tasks manually, increasing the risk and making examination difficult.
The SSC has asked the three firms to follow the rules, warning if they continued with their errant ways it would slap harsh penalties.
The watchdog also plans to examine other stock brokerages following complaints from investors and some listed companies whose stocks have gained sharply.
Source: Thanh Nien
The investigation showed that VCBS gave priority to orders from certain individuals and institutions, putting them through whatever time they came and not following the stock market rules.
Besides, 13 of its 22 employees involved in securities trading were not formally qualified for the job.
HSC, though mostly following the rules, did not maintain proper records for transactions like custodial services, mortgages, and share transfers, while the dates on some records did not match those at the bourse.
ACB Securities was allowing investors to use their stocks as collateral even before they were transferred to their accounts.
Also, it carried out some of the tasks manually, increasing the risk and making examination difficult.
The SSC has asked the three firms to follow the rules, warning if they continued with their errant ways it would slap harsh penalties.
The watchdog also plans to examine other stock brokerages following complaints from investors and some listed companies whose stocks have gained sharply.
Source: Thanh Nien
Food processor to increase capital
The Ha Long Canned Food Stock Corporation (Ha Long Canfoco) has listed 1.5 million additional shares, raising the firm's total shares trading on the on Ho Chi Minh City bourse to 5 million, worth 50 billion VND (3.1mio US$).
The latest issue helped the company raise over 30 billion VND (1.9mio US$).
In 2006, Ha Long Canfoco reaped profits of 8.5 billion VND (531,250 US$) in revenues of 205 billion VND (12.8mio US$).
Source: VNAVietcombank launches 2nd fund
Vietcombank Fund Management (VCBF) launched its second fund Friday, 120mio US$ closed-end private-equity fund.
Vietcombank Partners Fund 2 had been mobilized from regional and global financial institutions, Vu Viet Ngoan, general director of Vietcombank, the country’s leading foreign trade lender and majority stakeholder in VCBF, said.
The money raised would be invested in unlisted firms, especially large public companies or state-run corporations, that planned to go public soon.
The eight-year fund would also invest a small portion in listed stocks.
Like Partners Fund 1, the new fund would also focus on the oil and gas, banking, insurance, IT, and telecom industries.
Partners Fund 1, which raised 200 billion VND(12.5mio US$) in January last year, is fully invested in unlisted firms some of which will list this year.
It was subscribed by Vietnamese and foreign financial institutions.
VCBF is a joint venture in which the Bank for Foreign Trade of Viet Nam (Vietcombank) holds 51 percent, and Viet Capital Holding Pte. of Singapore the rest.
VCBF has also inked a memorandum of understanding with London Asia Capital, a London-listed Asia-focused merchant banking group, to set up an investment fund.
London Asia Capital will raise capital from investors abroad for the fund while the Vietnamese partner will locate projects in the country for investment.
The fund, whose corpus is yet to be decided, will invest in Vietnamese companies that are in the process of equitization or seeking to list globally.
It will target companies whose products and services benefit from Vietnam’s rapid economic growth, increasing wealth, and accession to the World Trade Organization.
Source: Thanh Nien
Vietcombank Partners Fund 2 had been mobilized from regional and global financial institutions, Vu Viet Ngoan, general director of Vietcombank, the country’s leading foreign trade lender and majority stakeholder in VCBF, said.
The money raised would be invested in unlisted firms, especially large public companies or state-run corporations, that planned to go public soon.
The eight-year fund would also invest a small portion in listed stocks.
Like Partners Fund 1, the new fund would also focus on the oil and gas, banking, insurance, IT, and telecom industries.
Partners Fund 1, which raised 200 billion VND(12.5mio US$) in January last year, is fully invested in unlisted firms some of which will list this year.
It was subscribed by Vietnamese and foreign financial institutions.
VCBF is a joint venture in which the Bank for Foreign Trade of Viet Nam (Vietcombank) holds 51 percent, and Viet Capital Holding Pte. of Singapore the rest.
VCBF has also inked a memorandum of understanding with London Asia Capital, a London-listed Asia-focused merchant banking group, to set up an investment fund.
London Asia Capital will raise capital from investors abroad for the fund while the Vietnamese partner will locate projects in the country for investment.
The fund, whose corpus is yet to be decided, will invest in Vietnamese companies that are in the process of equitization or seeking to list globally.
It will target companies whose products and services benefit from Vietnam’s rapid economic growth, increasing wealth, and accession to the World Trade Organization.
Source: Thanh Nien
Saturday, February 10, 2007
Kinh Do becomes Eximbank's shareholder
Confectionery and property company Kinh Do Group signed a deal to pick up 6.42% stake in Viet Nam Export Import Bank (Eximbank) for 90mio US$.
The strategic cooperation agreement means Kinh Do will pay a premium since the bank's chartered capital is only 2.8 trillion VND (175mio US$).
"The cooperation will allow us to share our networks in selling products and services," Le Phung Hao, Kinh Do depute general director, said. The two will also support each other's investment projects.
Viet Nam Eximbank is a leading joint stock commercial bank with total assets of 18.332 trillion VND. By the end of 2006 it had outstanding loans of more than 10 trillion VND. Its import-export payments during the year amounted to 2.3 billion USD and gross profit to VND 359 billion VND. It has agency relationships with 650 banks in 65 countries.
This year the bank expects to increase its assets to 31.7 trillion VND, outstanding loans to 15 trillion VND, and profits to 605 billion VND, Deputy General Director Nguyen Quoc Huong said.
Kinh Do Group comprises of nine companies, three of them listed, and has interests in confectionery, beverages, ice cream, and real estate. It holds almost 40% of the country's confectionery market besides exporting to over 30 foreign markets.
Source: VNA
The strategic cooperation agreement means Kinh Do will pay a premium since the bank's chartered capital is only 2.8 trillion VND (175mio US$).
"The cooperation will allow us to share our networks in selling products and services," Le Phung Hao, Kinh Do depute general director, said. The two will also support each other's investment projects.
Viet Nam Eximbank is a leading joint stock commercial bank with total assets of 18.332 trillion VND. By the end of 2006 it had outstanding loans of more than 10 trillion VND. Its import-export payments during the year amounted to 2.3 billion USD and gross profit to VND 359 billion VND. It has agency relationships with 650 banks in 65 countries.
This year the bank expects to increase its assets to 31.7 trillion VND, outstanding loans to 15 trillion VND, and profits to 605 billion VND, Deputy General Director Nguyen Quoc Huong said.
Kinh Do Group comprises of nine companies, three of them listed, and has interests in confectionery, beverages, ice cream, and real estate. It holds almost 40% of the country's confectionery market besides exporting to over 30 foreign markets.
Source: VNA
BIDV's IPO plans
Vietnam's third-largest bank, the state-run Bank for Investment and Development (BIDV or Vietindebank), will seek an initial public offering in the fourth quarter of this year and list shares by the second quarter of 2008.
But Vietindebank General Director Tran Bac Ha did not say how much the bank, which had total assets of 10 billion US$ at the end of 2006, wanted to raise at the share offering.
"After the IPO we will hold a shareholder meeting, and there is a process to follow, so the share listing would be in the first or the second quarter of 2008," he said late on Thursday.
Hanoi-based Vietindebank, along with Vietcombank, Incombank and the Mekong Delta Housing Development Bank are the state-run banks ordered by the government to equitize in 2007.
Agribank, the country's largest bank, will follow in 2008 to complete part of the banking sector reform viewed by foreign investors as a test for Vietnam in realizing commitments made when it joined the World Trade Organization in January.
Vietindebank officials said the lender would pick a foreign consultant for its equitization process, similar to steps taken by Vietcombank, the country's second-largest bank, and the Mekong Delta Housing Development Bank.
Vietcombank will sign a deal on Monday to hire global investment bank Credit Suisse for its equitization and Deutsche Bank has been chosen to help the Mekong Delta housing bank, banking officials said.
Pending a government approval on the IPO, Vietindebank has been diversifying business to build finance strength.
Last year, Moody's Investors Service ranked the bank's creditworthiness as Ba1 for an issuer of Vietnamese dong with a stable outlook.
"We aim for an asset of VND200 trillion (12.5 billion US$) at the end of this year," Ha said before signing a strategic partnership agreement with Vietnam's largest telecoms firm, VNPT.
The agreement allows the two to use each other's nationwide network and services and gives them the right to become each other's strategic shareholders when conducting IPOs.
The unlisted bank projected its gross profit this year to jump 63.5% on 2006 to VND2 trillion, Ha said.
"Overall we aim for growth of 23% this year," he added.
Vietindebank said it would prioritize to use VNPT's telecoms services and widen banking services to more areas where VNPT already has post offices. VNPT runs Vinaphone and
MobiFone, Vietnam's largest mobile-phone networks which also plan IPOs soon.
Vietindebank will form two investment funds with VNPT, the Vietnam Oil and Gas group, state utility Vietnam Electricity group and several domestic firms to raise around 1 billion US$to build power plants, roads and ports.
Last month, the bank signed partnership deals with a policy bank, the Vietnam Development Bank, and a Vietnamese firm, the Hoa Phat group that deals with steel production, construction and trading to expand lending and financial investment.
Sacombank, Vietnam's first listed bank, bought this week 1 million shares in Hoang Anh Gia Lai group that has business from wood processing to tourism to real estate.
Source: VNA
But Vietindebank General Director Tran Bac Ha did not say how much the bank, which had total assets of 10 billion US$ at the end of 2006, wanted to raise at the share offering.
"After the IPO we will hold a shareholder meeting, and there is a process to follow, so the share listing would be in the first or the second quarter of 2008," he said late on Thursday.
Hanoi-based Vietindebank, along with Vietcombank, Incombank and the Mekong Delta Housing Development Bank are the state-run banks ordered by the government to equitize in 2007.
Agribank, the country's largest bank, will follow in 2008 to complete part of the banking sector reform viewed by foreign investors as a test for Vietnam in realizing commitments made when it joined the World Trade Organization in January.
Vietindebank officials said the lender would pick a foreign consultant for its equitization process, similar to steps taken by Vietcombank, the country's second-largest bank, and the Mekong Delta Housing Development Bank.
Vietcombank will sign a deal on Monday to hire global investment bank Credit Suisse for its equitization and Deutsche Bank has been chosen to help the Mekong Delta housing bank, banking officials said.
Pending a government approval on the IPO, Vietindebank has been diversifying business to build finance strength.
Last year, Moody's Investors Service ranked the bank's creditworthiness as Ba1 for an issuer of Vietnamese dong with a stable outlook.
"We aim for an asset of VND200 trillion (12.5 billion US$) at the end of this year," Ha said before signing a strategic partnership agreement with Vietnam's largest telecoms firm, VNPT.
The agreement allows the two to use each other's nationwide network and services and gives them the right to become each other's strategic shareholders when conducting IPOs.
The unlisted bank projected its gross profit this year to jump 63.5% on 2006 to VND2 trillion, Ha said.
"Overall we aim for growth of 23% this year," he added.
Vietindebank said it would prioritize to use VNPT's telecoms services and widen banking services to more areas where VNPT already has post offices. VNPT runs Vinaphone and
MobiFone, Vietnam's largest mobile-phone networks which also plan IPOs soon.
Vietindebank will form two investment funds with VNPT, the Vietnam Oil and Gas group, state utility Vietnam Electricity group and several domestic firms to raise around 1 billion US$to build power plants, roads and ports.
Last month, the bank signed partnership deals with a policy bank, the Vietnam Development Bank, and a Vietnamese firm, the Hoa Phat group that deals with steel production, construction and trading to expand lending and financial investment.
Sacombank, Vietnam's first listed bank, bought this week 1 million shares in Hoang Anh Gia Lai group that has business from wood processing to tourism to real estate.
Source: VNA
Friday, February 09, 2007
Fisheries exports up 8.2% in January
Seafood exports last month increased 8.2% year-on-year to 192mio US$, according to the Ministry of Fisheries, due in part to a seasonal rise in demand.
In January, companies exported 47,470 tonnes of seafood, including 8,500 tonnes of frozen shrimp, 4,370 tonnes of cuttlefish and octopus, and 26,000 tonnes of fish.
Despite declining prices in local market, shrimp farmers were able to sell their goods to the US at 12.7 US$ a kilogram. In Soc Trang province, shrimp sold at 155,000 VN$ a kilogram, down by 10,000-15,000 VND against prices in mid-December.
Meanwhile, the price of tra and basa catfish surged on a month-on-month comparison. Officials attribute the trend to rising demand during the Christmas to Tet festive season and limited supplies from local ponds.
Despite the increase in the overall export value, revenues were kept in check by new hygiene standards imposed by Japan.
Deputy Fisheries Minister Nguyen Hong Minh has urged companies to improve quality and hygiene controls soon, given Japan is not the only country tightening inspection. Russia and Australia are also requiring new safety checks before seafood products enter their market.
Source: VNA
In January, companies exported 47,470 tonnes of seafood, including 8,500 tonnes of frozen shrimp, 4,370 tonnes of cuttlefish and octopus, and 26,000 tonnes of fish.
Despite declining prices in local market, shrimp farmers were able to sell their goods to the US at 12.7 US$ a kilogram. In Soc Trang province, shrimp sold at 155,000 VN$ a kilogram, down by 10,000-15,000 VND against prices in mid-December.
Meanwhile, the price of tra and basa catfish surged on a month-on-month comparison. Officials attribute the trend to rising demand during the Christmas to Tet festive season and limited supplies from local ponds.
Despite the increase in the overall export value, revenues were kept in check by new hygiene standards imposed by Japan.
Deputy Fisheries Minister Nguyen Hong Minh has urged companies to improve quality and hygiene controls soon, given Japan is not the only country tightening inspection. Russia and Australia are also requiring new safety checks before seafood products enter their market.
Source: VNA
MobiFone goes public this year
Mr Minh, the director of the Vietnam Mobile Telecom Service Company (VMS), said that the difficulties the company has to face during the equitisation process have nearly been resolved. The BCC (business cooperation contract) with Swedish Comvik has been liquidated, while the company has received direct instructions from the Government on detailed problems.
Now VMS is selecting the foreign consultant who will help build up the project on the company’s equitisation as requested by the Prime Minister. “Several experienced and prestigious consultants have contacted VMS, and we will choose suitable consultants in some days,” said Mr Minh.
“Our goal is to finish the equitisation in 2007,” he added.
Prior to that, the high ranking of the Ministry of Post and Telematics and the Vietnam Post and Telecommunication Group (VNPT) have also committed to undertake and complete MobiFone’s equitisation in 2007.
When talking about the attractiveness of VMS’s shares on the stock market, Mr Minh said that MobiFone itself now is a big trademark in Vietnam’s and regional markets. When it lists on the bourse, it would be a good opportunity for the company to develop and grow its trademark further.
In a recent survey conducted by Thoi bao kinh te Vietnam on the most attractive share items, the shares of the telecom companies proved to be the third attractive share item in the eyes of investors, after the finance and banking, and oil and gas industry, and more attractive than real estate, power and high technologies.
MobiFone plans to have 2.5mil subscribers more in 2007 and install 3,000 BTS (base transceiver stations) more in order to expand the coverage area.
Source: VNE
Now VMS is selecting the foreign consultant who will help build up the project on the company’s equitisation as requested by the Prime Minister. “Several experienced and prestigious consultants have contacted VMS, and we will choose suitable consultants in some days,” said Mr Minh.
“Our goal is to finish the equitisation in 2007,” he added.
Prior to that, the high ranking of the Ministry of Post and Telematics and the Vietnam Post and Telecommunication Group (VNPT) have also committed to undertake and complete MobiFone’s equitisation in 2007.
When talking about the attractiveness of VMS’s shares on the stock market, Mr Minh said that MobiFone itself now is a big trademark in Vietnam’s and regional markets. When it lists on the bourse, it would be a good opportunity for the company to develop and grow its trademark further.
In a recent survey conducted by Thoi bao kinh te Vietnam on the most attractive share items, the shares of the telecom companies proved to be the third attractive share item in the eyes of investors, after the finance and banking, and oil and gas industry, and more attractive than real estate, power and high technologies.
MobiFone plans to have 2.5mil subscribers more in 2007 and install 3,000 BTS (base transceiver stations) more in order to expand the coverage area.
Source: VNE
Sensitive OTC market
Shares of several big banks like Eximbank, EAB, An Binh, Phuong Nam and Habubank have been trading well; however, the prices have decreased by 2-5% compared to last week.
Prices have been decreasing since investors heard the warnings about the overly high prices of unlisted shares, which proved to exceed the actual values, though joint stock banks all announced good business performances in 2006.
Big lots of shares (1,000 shares and more) found it hard to be sold on February 5 and 6. Hot share items including Mai Linh, Alphanam and PVI have all seen price decreases.
Mai Linh shares are being offered at 43-48,000 VND/share. However, transactions succeeded at 42,000 VND/share, while no investor dares buy large lots of shares (5-10,000 shares) at this moment.
PVI, which once hit the 175,000 VND/share level, was traded at 165,000 VND/share on February 6. There are a lot of offers for sale of these share items on OTC websites, while very few offers for buying were found.
SSI, which were once traded at more than 80,000 VND/share, now are being offered at 75,000 VND/share.
The OTC market proves to be more sensitive than the official stock market. Investors sell shares immediately when prices begin going down. As the volume of shares sold has been too big, no one dares buy unlisted shares at this moment. Shares issued by Gia Dinh, Cho Lon Water Supply Companies cannot find customers now, and nor can shares of seafood, real estate and rubber companies. The offers for large lots of shares (more than 5,000 shares) of the non-bank and non-insurance companies these days prove to be hard to be successful.
Explaining the “shift of the wind”, the deputy director of a big securities company said that the information about the stricter control to be put over the OTC market had prompted investors to sell shares. There are too many share items on the OTC market, some 850 items, and the trading has been on a mess.
Meanwhile, Tran Quang Long, an investor at SSI’s trading floor, said that investors wanted to sell shares to take back capital as Tet was approaching. Many investors have to borrow money to trade securities and it is the right time to pay debts.
Source: VNE
Prices have been decreasing since investors heard the warnings about the overly high prices of unlisted shares, which proved to exceed the actual values, though joint stock banks all announced good business performances in 2006.
Big lots of shares (1,000 shares and more) found it hard to be sold on February 5 and 6. Hot share items including Mai Linh, Alphanam and PVI have all seen price decreases.
Mai Linh shares are being offered at 43-48,000 VND/share. However, transactions succeeded at 42,000 VND/share, while no investor dares buy large lots of shares (5-10,000 shares) at this moment.
PVI, which once hit the 175,000 VND/share level, was traded at 165,000 VND/share on February 6. There are a lot of offers for sale of these share items on OTC websites, while very few offers for buying were found.
SSI, which were once traded at more than 80,000 VND/share, now are being offered at 75,000 VND/share.
The OTC market proves to be more sensitive than the official stock market. Investors sell shares immediately when prices begin going down. As the volume of shares sold has been too big, no one dares buy unlisted shares at this moment. Shares issued by Gia Dinh, Cho Lon Water Supply Companies cannot find customers now, and nor can shares of seafood, real estate and rubber companies. The offers for large lots of shares (more than 5,000 shares) of the non-bank and non-insurance companies these days prove to be hard to be successful.
Explaining the “shift of the wind”, the deputy director of a big securities company said that the information about the stricter control to be put over the OTC market had prompted investors to sell shares. There are too many share items on the OTC market, some 850 items, and the trading has been on a mess.
Meanwhile, Tran Quang Long, an investor at SSI’s trading floor, said that investors wanted to sell shares to take back capital as Tet was approaching. Many investors have to borrow money to trade securities and it is the right time to pay debts.
Source: VNE
VNPT and BIDV start alliance
Under the deal signed Thursday in Hanoi, the Vietnam Post and Telecom Group (VNPT) and Bank for Development of Vietnam (BIDV) will work together as strategic partners, each reserving a major chunk of shares for the other to purchase on a mutual basis.
The two giant state corporations will utilize services including money transfers through their network of post agents, office transactions, automatic teller machines (ATMs), phone banking and internet banking.
The leading telecoms and banking providers plan to establish fund managers in various fields including energy, telecoms, property and mining.
They will also assist each other in training staff, according to the agreement.
Both sides will act as strategic founding members of fund management companies.
A BIDV representative said the two parties had also discussed either setting up or controlling a major portion of stakes in companies involved in the country’s forthcoming key mega projects.
These comprise the express way connecting the Ho Chi Minh City – Long Thanh – Dau Giay, the Vietnam-Laos Hydropower plant, Vietnam – Cambodia Hydropower plant, and a bank for trade, industry and services of Vietnam.
BIDV and VNPT have long established a close relationship as the bank had used VNPT-sourced services in return for short, medium and long term credit and syndicated loans for telecom projects.
The new formal strategic cooperation with a leading bank will enable VNPT to expand services and develop financial operations with the telecom business.
VNPT, last year, became a member of the ASEAN Telecom Holding Company (ATH/ACASIA), one of the Association of Southeast Asian Nations (ASEAN)'s leading primary network service providers, made up of the six leading telecom providers in the region, namely CAT, Indosat, JTB, PLDT, Singtel and Telekom Malaysia.
Source: Thanh Nien
New policies may stimulate growth
A securities executive forecast that Viet Nam's stock exchange would receive an influx of new-comers with strong financial portforlio in 2007 after the Government issued a series of policies in support of the financial and monetary markets.
Bui Nguyen Hoa, Head of the HCM City Branch Office of the State Securities Commission (SSC), told a workshop on the development and integration of the Viet Nam Securities Market, that the Government has always prioritised policies to promote reforms and development of relevant markets.
These policies always aim to attract businesses from all economic sectors, ensure effective management and support sustainable development, said the bourse executive. He also unveiled a SSC's plan to work with relevant Government agencies in gearing the legal system towards an open market in line with the nation's commitments to the World Trade Organisation. SSC will take firm measures to ensure careful but flexible enforcement of financial management policies in an effort to create a stable socio-political environment in favour of investment and economic development, concluded Hoa.
Source: VNA
Thursday, February 08, 2007
Carlsberg aims minority stake of Habeco
The state-owned Hanoi Beer Company (Habeco) recently announced plans to begin operating this year as a equitized company, offering a potentially lucrative investment for foreign brewers. The announcement is particularly interesting for Carlsberg, which has already established links with Habeco for a possible partnership in the country.
Carlsberg views Vietnam as a driving force in the development of the region's beer market.
Expected average annual growth for beer production in Vietnam is around 8%, according to Carlsberg's own figures.
This the company expects will see beer sales in the country - which totaled 15.2 million hectoliters in 2006, rise to 28.1 million hectoliters by 2015, making the market the third largest in Asia.
Under the terms of the equitization, the Vietnamese government will retain a 76% stake of Habeco, with the remaining 24% distributed between staff and investors.
Of this 24%, only 10 percent will be available for purchase by a strategic business partner, leaving Carlsberg at best with the potential of a minority stake in the group.
Jens Peter Skaarup, Carlsberg's international spokesperson said that the company was prepared for a gradual approach to expanding its operations within the country, and would persevere with its plans.
Source: Thanh Nien
Saigon brewery to sell equity
The State-owned Sai Gon Beverage Company (SABECO) plans to issue 20% of the company's value in the first phase to become a joint stock firm.
The sale, to strategic partners, employees and the public as well, is scheduled in June. It is in the process to select a consultant for its corporate evaluation.
Last year, SABECO sold 534 million litres of beer, its major product, in Viet Nam and overseas markets including China, Japan, the US and Canada with the export value worth 10 million USD. This year the figures are expected to rise 18% and 147% respectively.
Source: VNA
The sale, to strategic partners, employees and the public as well, is scheduled in June. It is in the process to select a consultant for its corporate evaluation.
Last year, SABECO sold 534 million litres of beer, its major product, in Viet Nam and overseas markets including China, Japan, the US and Canada with the export value worth 10 million USD. This year the figures are expected to rise 18% and 147% respectively.
Source: VNA
Monday, February 05, 2007
Vinamilk increased profit in 2006
Vietnam's top dairy product maker, Vinamilk, posted a 21%-increase in 2006 net profit to 733.23 billion VND (45.6mio US$), a company statement released at the stock exchange said.
Revenues of Vinamilk, Vietnam's second-largest listed company, increased 17.7% from 2005 to 6.66 trillion dong (414mio US$), the statement said.
Source: Reuters
Revenues of Vinamilk, Vietnam's second-largest listed company, increased 17.7% from 2005 to 6.66 trillion dong (414mio US$), the statement said.
Source: Reuters
Sai Gon Bank plans IPO
The Sai gon Bank announced it will issue shares worth 330 billion VND (20.6mio US$) this year.
The bank hopes to almost double its chartered capital from 690 billion VND (43.1mio US$) to 1.02 trillion VND (63.7mio US$).
The bank also plans to issues convertible bonds worth 1 trillion VND (62.5mio US$). Each 10-month bond will yield an interest rate of 9%.
Source: VNA
The bank hopes to almost double its chartered capital from 690 billion VND (43.1mio US$) to 1.02 trillion VND (63.7mio US$).
The bank also plans to issues convertible bonds worth 1 trillion VND (62.5mio US$). Each 10-month bond will yield an interest rate of 9%.
Source: VNA
Sunday, February 04, 2007
HaSTC to upgrade trading systems
The Ha Noi Securities Trading Centre (HaSTC) will focus on building the secondary market in a safe and efficient manner as one of its key tasks in 2007, a HaSTC executive said on Feb. 2.
HaSTC will put into operation a distant trading system, which will directly connect with securities companies, rather than conducting transactions at trading floor as at present so as to better meet the market's requirements and improve its operation efficiency, HaSTC's Director Tran Van Dung said.
Dung added that HaSTC will upgrade the existing bond trading system into a professional secondary system and will establish a network managing over-the-counter (OTC) transactions to help increase the efficiency of the management of unlisted share trading, reduce risks for investors and increase market transparency.
The director continued that his fledgling stock exchange, which began its operation in March 2005, has witnessed a robust growth in transaction scale and value with effective supervision and information announcement.
Within over a year, the number of businesses registered for trading on the Ha Noi stock exchange increased 14 fold, from six to 87, with a total registered capital of more than 11.3 trillion VND, he said, adding that the total value of the market also rose from 2 trillion VND at the beginning of 2006 to more than 73 trillion on Dec. 29, 2006.
Source: VNA
HaSTC will put into operation a distant trading system, which will directly connect with securities companies, rather than conducting transactions at trading floor as at present so as to better meet the market's requirements and improve its operation efficiency, HaSTC's Director Tran Van Dung said.
Dung added that HaSTC will upgrade the existing bond trading system into a professional secondary system and will establish a network managing over-the-counter (OTC) transactions to help increase the efficiency of the management of unlisted share trading, reduce risks for investors and increase market transparency.
The director continued that his fledgling stock exchange, which began its operation in March 2005, has witnessed a robust growth in transaction scale and value with effective supervision and information announcement.
Within over a year, the number of businesses registered for trading on the Ha Noi stock exchange increased 14 fold, from six to 87, with a total registered capital of more than 11.3 trillion VND, he said, adding that the total value of the market also rose from 2 trillion VND at the beginning of 2006 to more than 73 trillion on Dec. 29, 2006.
Source: VNA
Saturday, February 03, 2007
VN-Index closed at 1074 points
The VN-Index gained 25.23 points Friday to close at 1074.55.
A human error interrupted trading at the Ho Chi Minh City stock exchange Friday morning, the second time in as many months.
58 stocks gained and 21 lost. Several blue chips gained by the maximum allowed 5% – like Vinamilk, infrastructure developer SJS, and Refrigeration and Electrical Engineering.
Banking stock Sacombank edged down by 1,000 VND to 95,000 VND while IT giant FPT gained by 10,000 VND to close at 630,000 VND after losing 25,000 VND the previous session.
Trading volume was 7.34 million shares and turnover 823 billion VND (51.2mi0 US$), a fall of 537 billion VND.
Source: Thanh Nien
A human error interrupted trading at the Ho Chi Minh City stock exchange Friday morning, the second time in as many months.
58 stocks gained and 21 lost. Several blue chips gained by the maximum allowed 5% – like Vinamilk, infrastructure developer SJS, and Refrigeration and Electrical Engineering.
Banking stock Sacombank edged down by 1,000 VND to 95,000 VND while IT giant FPT gained by 10,000 VND to close at 630,000 VND after losing 25,000 VND the previous session.
Trading volume was 7.34 million shares and turnover 823 billion VND (51.2mi0 US$), a fall of 537 billion VND.
Source: Thanh Nien
Friday, February 02, 2007
State Bank of Vietnam announces 2007 Dong interest rates
The State Bank of Viet Nam announced on Jan. 31 several interest rates for Viet Nam Dong applied as of Feb. 1.
Accordingly, the basic interest rate is 8.25% p.a.
The re-capitalisation rate for credit institutions is 6.5% p.a., and their discount rate is 4.5% p.a.
Source: VNA
Accordingly, the basic interest rate is 8.25% p.a.
The re-capitalisation rate for credit institutions is 6.5% p.a., and their discount rate is 4.5% p.a.
Source: VNA
Inflation to rise by 2% due to Tet
The consumer price index is expected to increase in February by roughly 1.8-2% compared with last year, says the Ministry of Trade’s Domestic Market Management Board.
Officials expect consumer demand ahead of the Lunar New Year, Tet, in mid-February to drive prices higher.
In January, the index on a monthly comparison was up 1.1%, due primarily to Government price adjustments on coal, electricity, cement and certain food goods, according to the General Statistics Office.
Tet was a factor in January too, but is expected to be more so in the weeks leading up to the festival.
Source: VNS
Officials expect consumer demand ahead of the Lunar New Year, Tet, in mid-February to drive prices higher.
In January, the index on a monthly comparison was up 1.1%, due primarily to Government price adjustments on coal, electricity, cement and certain food goods, according to the General Statistics Office.
Tet was a factor in January too, but is expected to be more so in the weeks leading up to the festival.
Source: VNS
Deutsche Bank buys stake of Habubank
Deutsche Bank AG said it has signed an agreement with Hanoi Building Commercial Joint Stock Bank (Habubank) to acquire up to a 20 percent stake in the Vietnamese bank.
Source: Thanh Nien
Goldman Sachs plans operations in Vietnam
Investment banking and securities firm Goldman Sachs is planning to enter Vietnam’s financial market and has chosen Thien Viet Securities Company as a local partner.
In the short term, Goldman Sachs plans to make direct investment in Vietnam, providing consultancy services, guaranteeing securities issuances, helping enterprises list on the bourse and raise capital in both the domestic and international markets.
Chairman and CEO of Goldman Sachs Group, Lloyd Blankfein, flew to Vietnam to meet central bankers and other government officials last month when Vietnam celebrated its formal accession to the World Trade Organization.
Source: Thanh Nien
In the short term, Goldman Sachs plans to make direct investment in Vietnam, providing consultancy services, guaranteeing securities issuances, helping enterprises list on the bourse and raise capital in both the domestic and international markets.
Chairman and CEO of Goldman Sachs Group, Lloyd Blankfein, flew to Vietnam to meet central bankers and other government officials last month when Vietnam celebrated its formal accession to the World Trade Organization.
Source: Thanh Nien
Thursday, February 01, 2007
High demand for cable maker shares
The state-run Wires and Cables Company (Cadivi) Tuesday sold 3.42 million shares at the average price of VND185,000 per share, higher than many investors’ expectation. Cadivi obtained 635 billion VND (39.5mio US$) from the auction in the Ho Chi Minh City Securities Trading Center.
The stocks, making up for 21.4% of the total, offered to outsiders at the starting price of only 11,000 VND per unit.More than 4,000 investors registered to buy 44.6 million shares, 22 times higher than supply.
Market analysts had commented that the price of Cadivi’s shares could be from 100,000 VND to 120,000 VND but its price was 185,000 VND – much too high promoted by oversubscription. Only 253 individual investors won the auction with the lowest price of 152,600 VND per share and the highest price of 44.6 million VND per share.
Some experienced investors said they did not want to participate in the initial public offering because prices were pushed too high by individual investors, who were often driven by the ‘herd’ mentality.
After selling shares, the state will still hold 63% of Cadivi’s stake.It expected to reach this year’s turnover of 1.09 trillion VND (67.9mio US$) with 17 billion VND (1.05mio US$) in profits, a year-on-year jump of 30%.
The stocks, making up for 21.4% of the total, offered to outsiders at the starting price of only 11,000 VND per unit.More than 4,000 investors registered to buy 44.6 million shares, 22 times higher than supply.
Market analysts had commented that the price of Cadivi’s shares could be from 100,000 VND to 120,000 VND but its price was 185,000 VND – much too high promoted by oversubscription. Only 253 individual investors won the auction with the lowest price of 152,600 VND per share and the highest price of 44.6 million VND per share.
Some experienced investors said they did not want to participate in the initial public offering because prices were pushed too high by individual investors, who were often driven by the ‘herd’ mentality.
After selling shares, the state will still hold 63% of Cadivi’s stake.It expected to reach this year’s turnover of 1.09 trillion VND (67.9mio US$) with 17 billion VND (1.05mio US$) in profits, a year-on-year jump of 30%.
VN-Index increases by 1.85%
The VN-Index soared 18.93 points to 1041.33.
Market analysts attributed the “crazy” rush to buy shares among investors as investors purchasing without concern for the performance of listed-firms they bought.
There were more buyers than sellers as the session finished with a volume of 17.5 million shares and turnover of 1.06 trillion VND (66mio US$), increasing by 142 billion VND (8.8mio US$).
They also forecast that given the rate of capital inflow, the market is unlikely to cool down, despite warnings and efforts to control the market by authorities.
Seventy-two stocks gained and 23 lost.
Heavyweights continued to max out at the ceiling price growth of 5% including IT developer FPT, infrastructure developer SJS, Petroleum technical service PVD.
Sacombank stocks yesterday led the bourse in terms of trading volume with 837,000 shares traded while FPT continued to lead the market on trading value with 199 billion VND, nearly 20% of the market’s trading value.
Foreign investors retained aggressive interest in speculation over blue chips, stockpiling 2.6 million shares worth VND533 billion, half of the market’s trading value and up VND140 billion from the previous session.
Their stockpiles focused on PVD, FPT, VSH (hydropower builder) and GMD (freight forwarder).
They also sold 785,000 shares worth 178 billion VND(11mio US$).
Source: Thanh Nien
Market analysts attributed the “crazy” rush to buy shares among investors as investors purchasing without concern for the performance of listed-firms they bought.
There were more buyers than sellers as the session finished with a volume of 17.5 million shares and turnover of 1.06 trillion VND (66mio US$), increasing by 142 billion VND (8.8mio US$).
They also forecast that given the rate of capital inflow, the market is unlikely to cool down, despite warnings and efforts to control the market by authorities.
Seventy-two stocks gained and 23 lost.
Heavyweights continued to max out at the ceiling price growth of 5% including IT developer FPT, infrastructure developer SJS, Petroleum technical service PVD.
Sacombank stocks yesterday led the bourse in terms of trading volume with 837,000 shares traded while FPT continued to lead the market on trading value with 199 billion VND, nearly 20% of the market’s trading value.
Foreign investors retained aggressive interest in speculation over blue chips, stockpiling 2.6 million shares worth VND533 billion, half of the market’s trading value and up VND140 billion from the previous session.
Their stockpiles focused on PVD, FPT, VSH (hydropower builder) and GMD (freight forwarder).
They also sold 785,000 shares worth 178 billion VND(11mio US$).
Source: Thanh Nien
Vinaconex publishes goals for 2007
The Viet Nam Construction and Import-Export Corporation (Vinaconex) yesterday announced a 6.5 trillion VND (406mio US$) revenue target for the year, up 16.4% compared to 2006.
The corporation based its growth estimates on ongoing and new property development projects and capacity expansion efforts in its construction materials businesses, according to CEO Nguyen Van Tuan.
Pre-tax profit is expected to rise 49.7% to 350 billion VND (22mio US$) in 2007, while
Vinaconex’s contribution to State coffers is forecasted at 210 billion VND (13mio US$).
To achieve growth targets, Vinaconex plans to speed up marketing efforts for cement produced at its Cam Pha and Yen Binh plants some time in the fourth quarter. Vinaconex will also resume the Ngoi Phat Irrigation Project in the second quarter, and plans to establish its own finance company to help mobilise investment capital.
Last year, the companies annual earnings jumped by nearly 17% on the back of record high exports. Total trade turnover was 78mio US$, of which 42.2mio US$ was from exports.
In 2006, Vinaconex completed it equitisation and construction on the National Conference Centre, both of which contributed to earnings growth. It also begun major transportation infrastructure projects like the Bai Chay Bridge.
The company is seeking co-investors in a 600mio US$, Cai Gia-Cat Ba urban-tourism complex, located in the northern port city of Hai Phong.
On its 172 hectares, the complex is set to be home to villas, hotels, and an entertainment districts built around the city’s hills and waterways. The developer also plans to build infrastructure to accommodate international conferences, marinas and shopping centres.
Executives want the complex to be the biggest modern ecological tourism centre in Viet Nam.
Vinaconex is currently discussing potential co-operation agreements with domestic and foreign investors, said Tran Ngoc Quang, director of the Cai Gia-Cat Ba project management board.
The company has already begun the first phase of the complex, the construction of a 10-hectare, 300mio US$ resort. The resort is scheduled to be complete in 2012.
Source: VNS
Survey: What is the most attractive shares?
36.5% of respondents said they thought that bank shares were the most secure item in the stock market. Shares of enterprises in the oil and gas industry ranked second in terms of attractiveness and profitability (12.4%), while telecommunications company shares ranked third (10.7%), followed by the real estate sector (10.4%), and power (10.3%).
Share items of high-tech enterprises ranked sixth (8.5%), followed by food processing and consumer goods, health care and other sectors, with 4.5%, 4.4% and 2.3%, respectively.
The survey’s results have not surprised any one as it coincides with what can be seen in the stock market.
The attractiveness of bank shares has been acknowledged. Local banks have been recording the highest profit levels of recent years, and foreign bankers are eyeing them as good places for making investments.
There is quite a strange thing in that bank shares attract investors in general; there seems to be no big gap between the prices of big bank shares and those of “junior” banks. In fact, the prices of ABBank, SHB (which has just shifted from a rural bank to an urban bank) and G-Bank shares are now close to the prices of Southern Bank and VIB Bank shares.
In addition, many bank share items have prices lower than the prices of shares of enterprises in other sectors.
For example, ACB (Asia Commercial Bank) shares, which have the highest price levels, now have a market value 16-18 times the face value, while other bank share items just have market prices 7-8 times the face value. Meanwhile, in the stock market, the prices of other share items are listed at 40-50, or even 60 times the face value.
Of course, the market value of share items is defined based on many factors. FPT (the Corporation for Financing and Promoting Technologies) is just a half of ACB in terms of scale, but it reported the same post tax profit in 2006 (609bil VND or 38.06mio US$). The high R/E ratio is a factor which explains why the market value of FPT shares is 50 times higher than the face value.
One year ago, shares of power companies did not attract investors; however, investors are now declaring that it is the time for power company shares. It is quite surprising that power company shares are even more attractive in the eyes of investors than shares of high-tech companies.
In the current context, real estate is still considered the most profitable business, but there also latent, big risks. That explains why TDH (Thu Duc Housing Development Company) and HBC (Hoa Binh Property Company) prices have fluctuated recently.
High-tech industries require much capital and intelligence, which can also bring valuable products and high profitability. However, the brain content in products is the biggest problem of Vietnamese companies nowadays, while the life expectancy of technologies is very short, as new technologies can be born every day.
It is quite surprising that shares of health care companies are less attractive in the eyes of investors. However, analysts said that the situation would improve.
Source: VNE
Share items of high-tech enterprises ranked sixth (8.5%), followed by food processing and consumer goods, health care and other sectors, with 4.5%, 4.4% and 2.3%, respectively.
The survey’s results have not surprised any one as it coincides with what can be seen in the stock market.
The attractiveness of bank shares has been acknowledged. Local banks have been recording the highest profit levels of recent years, and foreign bankers are eyeing them as good places for making investments.
There is quite a strange thing in that bank shares attract investors in general; there seems to be no big gap between the prices of big bank shares and those of “junior” banks. In fact, the prices of ABBank, SHB (which has just shifted from a rural bank to an urban bank) and G-Bank shares are now close to the prices of Southern Bank and VIB Bank shares.
In addition, many bank share items have prices lower than the prices of shares of enterprises in other sectors.
For example, ACB (Asia Commercial Bank) shares, which have the highest price levels, now have a market value 16-18 times the face value, while other bank share items just have market prices 7-8 times the face value. Meanwhile, in the stock market, the prices of other share items are listed at 40-50, or even 60 times the face value.
Of course, the market value of share items is defined based on many factors. FPT (the Corporation for Financing and Promoting Technologies) is just a half of ACB in terms of scale, but it reported the same post tax profit in 2006 (609bil VND or 38.06mio US$). The high R/E ratio is a factor which explains why the market value of FPT shares is 50 times higher than the face value.
One year ago, shares of power companies did not attract investors; however, investors are now declaring that it is the time for power company shares. It is quite surprising that power company shares are even more attractive in the eyes of investors than shares of high-tech companies.
In the current context, real estate is still considered the most profitable business, but there also latent, big risks. That explains why TDH (Thu Duc Housing Development Company) and HBC (Hoa Binh Property Company) prices have fluctuated recently.
High-tech industries require much capital and intelligence, which can also bring valuable products and high profitability. However, the brain content in products is the biggest problem of Vietnamese companies nowadays, while the life expectancy of technologies is very short, as new technologies can be born every day.
It is quite surprising that shares of health care companies are less attractive in the eyes of investors. However, analysts said that the situation would improve.
Source: VNE
Wednesday, January 31, 2007
Bao Minh forecasts 10% revenue growth for 2007
The second largest insurer in Viet Nam Bao Minh (BMI), is forecasting revenues of 1.6 trillion VND (100mio US$) in 2007.
That would represent a 6% increase over 2006 figures, according to the company, listed at Hanoi. After tax profits have been pegged at 110 billion VND (6.9mio US$).
Revenues from re-insurance plans are predicted to account for 100 billion VND (6.25mio US$).
To reach the 2007 targets, the company plans to complete its corporate regulations and start training courses for junior and senior managers.
The changes will help Bao Minh stay competitive with foreign insurers expected to flow into the country following Viet Nam’s integration into the World Trade Organisation, company officials said.
The firm also recently released its results from 2006. According to its annual report, revenues last year reached more than 1.4 trillion VND (90.3mio US$), a 20% increase over 2005. Its re-insurance division was especially strong, earning 80.9 billion VND (5.1mio US$), up 58% from 2005.
The price of Bao Minh shares have doubled in the last two months.
The company attributed its success to domestic expansion and the strength of the developing insurance sector. The company has decided to offer dividends of 700 VND a piece based on its strong 2006 performance. The payments will be made next month.
Source: VNS
Gas trading company prepares IPO
A Vietnamese gas trading company said on Tuesday it would auction shares to the public on the country's main stock market in early March to raise at least 3mio US$.
Petrovietnam Southern Gas Company, a member of the National Oil and Gas Group, said in a statement it would sell 4,703,800 shares, or 31.36% of the company's total, in an initial public offering on March 9.
The company has set a starting price for bids at 10,500 dong (0.65 US$) per share, which suggested the firm would be valued at 9.75mio US$. The gas company has yet to announce a listing date.
BIDV Securities Co is advising on the share sale of the firm, which exports, imports and trades liquefied petroleum gas (LPG) as well as provides LPG transportation services.
LPG is typically bottled in canisters and used as a cooking fuel in areas without gas pipeline systems.
Vietnam's LPG production last year eased 0.7% to 343,400 tonnes following a fall of 0.3% in natural gas output to 6.42 billion cubic metres, government figures showed.
Earlier this month, Prime Minister Nguyen Tan Dung told Reuters that Vietnam planned to privatise more than 100 state companies in 2007 and 2008, including the oil and gas industries.
The National Oil and Gas Group began operation on Monday after being restructured from state oil monopoly Petrovietnam.
Petrovietnam Vice President Hoang Van Hoan told Reuters recently that the firm would sell off stakes in non oil-producing subsidiaries but maintain 100% government ownership in core businesses such as crude oil production.
The government has been speeding privatisations to boost the stock market's value to 30% of gross domestic product this year, from 13.6 billion US$ or 22.7% of the 2006 GDP.
Hanoi has said it will retain full ownership or major stakes only in industries linked closely to national defence and security.
State-run companies often undergo partial privatisation by selling shares to employees and outsiders before applying for a licence to list shares on the stock market.
Source: Reuters
Petrovietnam Southern Gas Company, a member of the National Oil and Gas Group, said in a statement it would sell 4,703,800 shares, or 31.36% of the company's total, in an initial public offering on March 9.
The company has set a starting price for bids at 10,500 dong (0.65 US$) per share, which suggested the firm would be valued at 9.75mio US$. The gas company has yet to announce a listing date.
BIDV Securities Co is advising on the share sale of the firm, which exports, imports and trades liquefied petroleum gas (LPG) as well as provides LPG transportation services.
LPG is typically bottled in canisters and used as a cooking fuel in areas without gas pipeline systems.
Vietnam's LPG production last year eased 0.7% to 343,400 tonnes following a fall of 0.3% in natural gas output to 6.42 billion cubic metres, government figures showed.
Earlier this month, Prime Minister Nguyen Tan Dung told Reuters that Vietnam planned to privatise more than 100 state companies in 2007 and 2008, including the oil and gas industries.
The National Oil and Gas Group began operation on Monday after being restructured from state oil monopoly Petrovietnam.
Petrovietnam Vice President Hoang Van Hoan told Reuters recently that the firm would sell off stakes in non oil-producing subsidiaries but maintain 100% government ownership in core businesses such as crude oil production.
The government has been speeding privatisations to boost the stock market's value to 30% of gross domestic product this year, from 13.6 billion US$ or 22.7% of the 2006 GDP.
Hanoi has said it will retain full ownership or major stakes only in industries linked closely to national defence and security.
State-run companies often undergo partial privatisation by selling shares to employees and outsiders before applying for a licence to list shares on the stock market.
Source: Reuters
VN-Index recovers
Vietnam's stock market reclaimed the 1,000-point level on Tuesday, stemming a slide in recent sessions, as investors sought stocks with strong earnings potential such as information technology firm FPT.
The VN Index on the Ho Chi Minh City Securities Trading Center gained 2.7% to close at 1,022.4 points.
The index is now up 3.4% up from last Thursday, when it fell below 1,000 points for the first time on fears that the market was overheating. The index has surged 36% so far in 2007.
"Investors showed a strong appetite for shares of FPT thanks to its profitability last year and a high business growth forecast this year," a market analyst in Hanoi said.
Shares in FPT, the country's largest listed company, climbed 4.1% to close at 630,000 VND ($39), taking its market capitalisation to nearly US$2.4 billion US$.
FPT said last week that strong hardware sales, including mobile phone handsets, boosted its 2006 net profit by 77.5% to 33mio US$, or 10% above its forecast.
The company has forecast profit and sales growth this year and 2008 of 40-50%, thanks to outsourcing and new lines of businesses including telecommunication services.
Another winner on Tuesday was PV Drilling whose shares rose limit up or nearly 5% to close at 279,000 VND (17.3 US$). The firm is the oil service arm of state oil and gas company Petrovietnam.
Government regulators said this month they were concerned about speculators driving up share prices, while fund managers told a capital markets conference in Hanoi that the market was overheated and due for a correction after it climbed nearly 145% in 2006.
They said intense speculation by foreign and domestic investors, or "hot money", had created an artificial shortage of stock.
Source: Reuters
The VN Index on the Ho Chi Minh City Securities Trading Center gained 2.7% to close at 1,022.4 points.
The index is now up 3.4% up from last Thursday, when it fell below 1,000 points for the first time on fears that the market was overheating. The index has surged 36% so far in 2007.
"Investors showed a strong appetite for shares of FPT thanks to its profitability last year and a high business growth forecast this year," a market analyst in Hanoi said.
Shares in FPT, the country's largest listed company, climbed 4.1% to close at 630,000 VND ($39), taking its market capitalisation to nearly US$2.4 billion US$.
FPT said last week that strong hardware sales, including mobile phone handsets, boosted its 2006 net profit by 77.5% to 33mio US$, or 10% above its forecast.
The company has forecast profit and sales growth this year and 2008 of 40-50%, thanks to outsourcing and new lines of businesses including telecommunication services.
Another winner on Tuesday was PV Drilling whose shares rose limit up or nearly 5% to close at 279,000 VND (17.3 US$). The firm is the oil service arm of state oil and gas company Petrovietnam.
Government regulators said this month they were concerned about speculators driving up share prices, while fund managers told a capital markets conference in Hanoi that the market was overheated and due for a correction after it climbed nearly 145% in 2006.
They said intense speculation by foreign and domestic investors, or "hot money", had created an artificial shortage of stock.
Source: Reuters
Government bond auction announced
The State Treasury has announced its plan to auction government bonds with total value of 12.5 trillion VND (781mio US$) during the first quarter of this year.
Of the total sum, 5 trillion VND in treasury bills will be sold through the State Bank and 7.5 trillion VND in government bonds will be auctioned at the securities trading centres.
The State Treasury will open six auction sessions in the first three months, expecting to raise between 300 billion VND and 1 trillion VND in each session.
However, the government bonds' auction at the securities trading centre depends on the disbursement pace of transport and irrigation projects
Source: VNA
Of the total sum, 5 trillion VND in treasury bills will be sold through the State Bank and 7.5 trillion VND in government bonds will be auctioned at the securities trading centres.
The State Treasury will open six auction sessions in the first three months, expecting to raise between 300 billion VND and 1 trillion VND in each session.
However, the government bonds' auction at the securities trading centre depends on the disbursement pace of transport and irrigation projects
Source: VNA
New Insurance JV to be established
The Bank for Foreign Trade of Viet Nam (Vietcombank) has teamed up with the Southeast Asia Commercial Joint Stock Bank (Sea Bank) and the Cardif Company - an affiliate of the French BNP Paribas Group - to establish a life insurance company.
Under a tripartite agreement signed in Ha Noi on Jan. 30, the Vietcombank-Cardif Life Insurance Co. Ltd., (VCB Cardif) has a chartered capital of 140 billion VND (8.75mio US$), 45% of which will be contributed by Vietcombank, 43% by Cardif, and the remaining 12% by Sea Bank.
VCB Cardif will provide a wide range of services, focusing on life insurance, health insurance, accident insurance, fund management and capital investment as well as other fields related to life insurance.
Vietcombank General Director Vu Viet Ngoan said the association with Cardif - an international leading firm in supplying Bancassurance services - will help meet clients' growing demands for package financial services and realize the bank's ambition to become one of the leading financial groups in the region.
Bancassurance - the selling of insurance and banking products through the same channel - has been initiated in Viet Nam in the 1980s, but has seen slow development.
Therefore, VCB Cardif is expected to make a breakthrough in the domestic Bancassurance services market.
Source: VNA
Tuesday, January 30, 2007
PVI provides 5 billion US$ insurance
The PetroVietnam Insurance Company (PVI) has signed a contract to provide three-year insurance service worth 5 billion US$ to Vietsovpetro, a joint venture of the Viet Nam National Oil and Gas Group (PetroVietnam) and a Russian partner.
The service will have an insurance fee of about 40mio US$.
Under the contract, PVI will cover all insurance services for Vietsovpetro's operations and properties from 2007 to 2010.
PVI and Vietsovpetro have worked together since 1996, however, the long-term contract marks a new step of development in their cooperation.
Source: VNA
Monday, January 29, 2007
No insider trading
The State Securities Commission Saturday allayed the Vietnam Association of Financial Investors (VAFI)’s apprehension over insider trading.
VAFI had said information supplied to the stock exchange by enterprises could be used by bourse insiders before it was released to the public.
The market regulator said there was no cause for worry since companies had to publicly release the information at the same time.
Source: VNA
VAFI had said information supplied to the stock exchange by enterprises could be used by bourse insiders before it was released to the public.
The market regulator said there was no cause for worry since companies had to publicly release the information at the same time.
Source: VNA
VN-Index declining
Vietnamese stocks tumbled for a third straight day Friday with analysts blaming it on oversupply.
The VN-Index slid 14.1 points to 974.76 as 40 shares gained and 49 lost.
Turnover declined by 24% VND1.19 trillion (118mio US$) on volumes of 12.6 million shares.
A PetroVietnam Drilling and Service Affiliate, PVD, one of the hottest stocks on the bourse recently, lost 4.87% to close at VND254,000. There were sellers for 435,460 shares but no buyers.
Leading confectionery maker Kinh Do Corp fell by 4.93% to VND212,000.
Another heavyweight, Cables and Telecom Materials Joint Stock Co, lost 4.88% to close at VND195,000.
Mutual fund PRUBF1 fell sharply after gaining for three consecutive sessions with 435,460 shares failing to find buyers.
Infrastructure developer SJS hit the upper ceiling as it rose by VND13,000 to VND288,000. There were buyers for 175,510 shares but no sellers.
IT developer FPT and Refrigeration engineering were unchanged at VND580,000 and VND191,000 respectively.
Foreign investors were net sellers, offloading VND51 billion (3.2mio US$) worth shares.
Source: VNA
The VN-Index slid 14.1 points to 974.76 as 40 shares gained and 49 lost.
Turnover declined by 24% VND1.19 trillion (118mio US$) on volumes of 12.6 million shares.
A PetroVietnam Drilling and Service Affiliate, PVD, one of the hottest stocks on the bourse recently, lost 4.87% to close at VND254,000. There were sellers for 435,460 shares but no buyers.
Leading confectionery maker Kinh Do Corp fell by 4.93% to VND212,000.
Another heavyweight, Cables and Telecom Materials Joint Stock Co, lost 4.88% to close at VND195,000.
Mutual fund PRUBF1 fell sharply after gaining for three consecutive sessions with 435,460 shares failing to find buyers.
Infrastructure developer SJS hit the upper ceiling as it rose by VND13,000 to VND288,000. There were buyers for 175,510 shares but no sellers.
IT developer FPT and Refrigeration engineering were unchanged at VND580,000 and VND191,000 respectively.
Foreign investors were net sellers, offloading VND51 billion (3.2mio US$) worth shares.
Source: VNA
Pharmaceutical company to auction shares
OPC Pharmaceutical, will auction off 600,000 shares through the HCM City Securities Trading Centre on Feb. 1.
The firm hopes the auction will generate about 65 billion VND (4.1 million US$), said Le Minh Diem, chairman of the company's management board.
The money is slated for several large projects including a plant in Binh Duong province and warehouses in Ha Noi, Da Nang and Can Tho.
The shares will be offered at 42,000 VND (2.6 US$) a piece.
OPC was established in 1977 as a joint venture between eight HCM City pharmacies. The company was equitised in 2002, the first such move in the pharmaceutical sector.
Revenues at the end of the third quarter of 2006 were 110 billion VND (6.8mio US$), and a profit reached 20.2 billion VND (1.3mio US$).
The company last year paid dividends at 18%, a rate that will remain the same this year. However, the company plans to raise dividends to 20% in the future, said Diem.
He also added that the company hopes to double its chartered capital to 80 billion VND (5mio US$)
Source: VNA
The firm hopes the auction will generate about 65 billion VND (4.1 million US$), said Le Minh Diem, chairman of the company's management board.
The money is slated for several large projects including a plant in Binh Duong province and warehouses in Ha Noi, Da Nang and Can Tho.
The shares will be offered at 42,000 VND (2.6 US$) a piece.
OPC was established in 1977 as a joint venture between eight HCM City pharmacies. The company was equitised in 2002, the first such move in the pharmaceutical sector.
Revenues at the end of the third quarter of 2006 were 110 billion VND (6.8mio US$), and a profit reached 20.2 billion VND (1.3mio US$).
The company last year paid dividends at 18%, a rate that will remain the same this year. However, the company plans to raise dividends to 20% in the future, said Diem.
He also added that the company hopes to double its chartered capital to 80 billion VND (5mio US$)
Source: VNA
Saturday, January 27, 2007
Incombank increased assets in 2006 and plans IPO for 4th quarter 2007
The Vietnamese state-owned Industrial and Commercial Bank (Incombank) is preparing to go public in the fourth quarter this year, its head said Thursday.
Pham Huy Hung, general director, said the government had approved an equitization plan, the first by a state-owned bank, submitted by the bank but declined to reveal further details.
He said merely the bank had hired Ernst & Young to audit its books.
Incombank has a chartered capital of 4 trillion VND (249mio US$) and the government plans to inject more funds to scale up its capital to 10 trillion VND (622mio US$) before the IPO.
It has assets of 138.3 trillion VND (8.6mio US$), a year-on-year jump of 18.8%, 136 branches and 145 transaction offices.
It made a profit last year of 780 billion VND (49mio US$), +3.4% and had reserves of 1.66 trillion VND (103mio US$).
It has deposits of nearly 124 trillion VND (7.7mio US$) and outstanding loans of 125 trillion VND (7.8mio US$).
The bank has managed to reduce its bad debts to 1.38% from 28% in 2000.
Source: Thanh Nien
Pham Huy Hung, general director, said the government had approved an equitization plan, the first by a state-owned bank, submitted by the bank but declined to reveal further details.
He said merely the bank had hired Ernst & Young to audit its books.
Incombank has a chartered capital of 4 trillion VND (249mio US$) and the government plans to inject more funds to scale up its capital to 10 trillion VND (622mio US$) before the IPO.
It has assets of 138.3 trillion VND (8.6mio US$), a year-on-year jump of 18.8%, 136 branches and 145 transaction offices.
It made a profit last year of 780 billion VND (49mio US$), +3.4% and had reserves of 1.66 trillion VND (103mio US$).
It has deposits of nearly 124 trillion VND (7.7mio US$) and outstanding loans of 125 trillion VND (7.8mio US$).
The bank has managed to reduce its bad debts to 1.38% from 28% in 2000.
Source: Thanh Nien
Credit Suisse signs deals
Credit Suisse Group has signed deals to arrange financing of up to 700mio US$ for Vietnam Shipbuilding Industry Group.
The group also signed a deal to develop a financing program of up to 1 billion US$ and provide other financial services for Vietnam National Shipping Lines, the report added.
Paul Calello, Credit Suisse's Asia-Pacific chief executive, says that the two companies are “at the forefront of the rapid economic development taking place in Vietnam."
Credit Suisse forecasts the Vietnam economy will grow 9.2% in 2007, following estimated 8.2% growth in 2006.
Credit Suisse was the sole bookrunner of Vietnam's 750mio US$ debut sovereign bond issue in 2005 and has also been Vietnam's ratings adviser since 2002.
The Swiss bank also has a license to trade in domestic equities in Vietnam, as well as government and corporate bonds.
Source: Thanh Nien
The group also signed a deal to develop a financing program of up to 1 billion US$ and provide other financial services for Vietnam National Shipping Lines, the report added.
Paul Calello, Credit Suisse's Asia-Pacific chief executive, says that the two companies are “at the forefront of the rapid economic development taking place in Vietnam."
Credit Suisse forecasts the Vietnam economy will grow 9.2% in 2007, following estimated 8.2% growth in 2006.
Credit Suisse was the sole bookrunner of Vietnam's 750mio US$ debut sovereign bond issue in 2005 and has also been Vietnam's ratings adviser since 2002.
The Swiss bank also has a license to trade in domestic equities in Vietnam, as well as government and corporate bonds.
Source: Thanh Nien
Thermal power company lists in HCMC
The Pha Lai Joint-Stock Thermal Power Company made a debut at the Ho Chi Minh City Securities Trading Centre on Jan. 26 with an offer of over 310 million shares for sale.
The power supplier with over 3 trillion VND (almost 190mio US$) in legal capital became the most powerful that has ever listed shares on the exchange floor so far.
Its first appearance today witnessed 131,000 shares, under the codename of PPC, find new owners, thus bringing the total share holders to 3,675, including 85 foreign individuals and 11 foreign companies, which hold over 11 million shares.
The Pha Lai company boasts two thermal power plants with a combined capacity of 6.24 billion kWh a year and assets worth almost 10.7 trillion VND (668mio US$) in total.
The two plants generated a record output of 7.25 billion kWh in 2006, earning over 200 mio US$ in revenues and over 61.3mio US$ in profits.
Pha Lai closed up at 105,000 VND (6.5 US$) each on the Ho Chi Minh City Securities Trading Center after the firm moved its listing from the Hanoi over-the-counter stock market, where they last traded at 65,600 VND.
Brokers said more shares in Pha Lai Thermal Power Co. would be offered to the public as the key shareholder, dominant state utility Electricity of Vietnam (EVN) now holding 78% of stake, is expected to reduce its ownership to 51%.
Source: VNA, Thanh Nien
The power supplier with over 3 trillion VND (almost 190mio US$) in legal capital became the most powerful that has ever listed shares on the exchange floor so far.
Its first appearance today witnessed 131,000 shares, under the codename of PPC, find new owners, thus bringing the total share holders to 3,675, including 85 foreign individuals and 11 foreign companies, which hold over 11 million shares.
The Pha Lai company boasts two thermal power plants with a combined capacity of 6.24 billion kWh a year and assets worth almost 10.7 trillion VND (668mio US$) in total.
The two plants generated a record output of 7.25 billion kWh in 2006, earning over 200 mio US$ in revenues and over 61.3mio US$ in profits.
Pha Lai closed up at 105,000 VND (6.5 US$) each on the Ho Chi Minh City Securities Trading Center after the firm moved its listing from the Hanoi over-the-counter stock market, where they last traded at 65,600 VND.
Brokers said more shares in Pha Lai Thermal Power Co. would be offered to the public as the key shareholder, dominant state utility Electricity of Vietnam (EVN) now holding 78% of stake, is expected to reduce its ownership to 51%.
Source: VNA, Thanh Nien
HSBC plans to increase Techcombank-stake
The Viet Nam Technological and Commercial Bank (Techcombank) recently reached a deal to sell an additional 10% of its stake to the Hong Kong and Shanghai Banking Corporation (HSBC).
However, a Techcombank executive added, the plan will have to be submitted to the State Bank of Viet Nam for consideration.
It is also required to wait for the state's ratification of new regulations that will enable a foreign bank to hold a 20%- stake of a domestic bank.
If accepted, HSBC will pay Techcombank 85mio US$ for the additional stake and become the first foreign bank to own up to 20% of shares in a local bank.
In December 2005, HSBC paid only 27mio US$ for the first 10%.
Techcombank reported a revenue of more than 1.5 trillion VND in 2006, including 132 billion VND earned by its service sector, confirming its leading role in the pool of joint stock banks. Its pre-tax profit was registered at over 355.86 billion VND.
Source: VNA
However, a Techcombank executive added, the plan will have to be submitted to the State Bank of Viet Nam for consideration.
It is also required to wait for the state's ratification of new regulations that will enable a foreign bank to hold a 20%- stake of a domestic bank.
If accepted, HSBC will pay Techcombank 85mio US$ for the additional stake and become the first foreign bank to own up to 20% of shares in a local bank.
In December 2005, HSBC paid only 27mio US$ for the first 10%.
Techcombank reported a revenue of more than 1.5 trillion VND in 2006, including 132 billion VND earned by its service sector, confirming its leading role in the pool of joint stock banks. Its pre-tax profit was registered at over 355.86 billion VND.
Source: VNA
Viet Nam – An attractive place, say Japanese investors
Japanese financers and bankers consider Viet Nam as the most attractive place for indirect investment among developing economies, affirmed a senior officer of a Tokyo-based global investment bank.
Taro Hayashi, Managing Director of Nikko Citygroup was speaking at a seminar on investment environment and opportunities in Viet Nam after the country’s accession to the World Trade Organisation (WTO) held by the Vietnamese Embassy in Tokyo on Jan. 25.
Hayashi told representatives of Japanese financial institutions, banks, insurance corporations and investment funds at the seminar that the fine development of relations between Japan and Viet Nam has opened unprecedented cooperation opportunities for his country’s investors.
He said Japan has a large amount of individual savings that are untapped and await investment opportunities, as his wholesale investment bank is going to lead a delegation combining representatives of a number of Japanese corporations to Ho Chi Minh City – Viet Nam’s southern economic hub - to seek for cooperation and business opportunities.
Vietnamese Ambassador to Japan Chu Tuan Cap introduced Japanese businesspeople of the nation’s socio-economic development direction in 2007 as well as development plans until 2010 and 2020.
“Japanese investors will see Viet Nam as a very favourable environment, both politically and economically, to invest and to do business,” stressed the ambassador.
Ambassador Chu Tuan Cap also took this occasion to answer various questions raised by Japanese participants concerning Viet Nam’s policies on foreign indirect investment flow and measures to ride the investment wave from Japan, as well as difficulties in the country’s equitisation process, weak competitiveness of Vietnamese enterprises and issues relating to at Viet Nam’s securities market.
Japanese corporate representatives at the seminar proposed that Viet Nam should increase the number of companies listed at the securities market, particularly big corporations, in order to provide a larger source of supply.
They also wanted Viet Nam to encourage its enterprises to open websites in English to make it easier for foreign investors to access, while some of them expressed the wish that Viet Nam continues to maintain political stability to facilitate long-term investment in the country.
Source: VNA
Taro Hayashi, Managing Director of Nikko Citygroup was speaking at a seminar on investment environment and opportunities in Viet Nam after the country’s accession to the World Trade Organisation (WTO) held by the Vietnamese Embassy in Tokyo on Jan. 25.
Hayashi told representatives of Japanese financial institutions, banks, insurance corporations and investment funds at the seminar that the fine development of relations between Japan and Viet Nam has opened unprecedented cooperation opportunities for his country’s investors.
He said Japan has a large amount of individual savings that are untapped and await investment opportunities, as his wholesale investment bank is going to lead a delegation combining representatives of a number of Japanese corporations to Ho Chi Minh City – Viet Nam’s southern economic hub - to seek for cooperation and business opportunities.
Vietnamese Ambassador to Japan Chu Tuan Cap introduced Japanese businesspeople of the nation’s socio-economic development direction in 2007 as well as development plans until 2010 and 2020.
“Japanese investors will see Viet Nam as a very favourable environment, both politically and economically, to invest and to do business,” stressed the ambassador.
Ambassador Chu Tuan Cap also took this occasion to answer various questions raised by Japanese participants concerning Viet Nam’s policies on foreign indirect investment flow and measures to ride the investment wave from Japan, as well as difficulties in the country’s equitisation process, weak competitiveness of Vietnamese enterprises and issues relating to at Viet Nam’s securities market.
Japanese corporate representatives at the seminar proposed that Viet Nam should increase the number of companies listed at the securities market, particularly big corporations, in order to provide a larger source of supply.
They also wanted Viet Nam to encourage its enterprises to open websites in English to make it easier for foreign investors to access, while some of them expressed the wish that Viet Nam continues to maintain political stability to facilitate long-term investment in the country.
Source: VNA
Friday, January 26, 2007
VN-Index drops below 1000 points
The VN Index on the Ho Chi Minh City Securities Trading Center closed at 988.86, down 2.71% from Wednesday and nearly 5% below a record of 1,040.7 on Tuesday.
The market declined days after government regulators said they were concerned about speculators driving up share prices. In addition, fund managers told a capital markets conference in Hanoi that the market was overheated and due for a correction.
They said intense speculation by foreign and domestic investors, or "hot money", had created an artificial shortage of stock, sending the index up nearly 32% already in 2007.
The index breached the 1,000-point resistance level at the close last Friday for the first time since the market opened in July 2000.
"There is a real concern that share prices in some blue chip firms including PetroVietnam Drilling were excessive," a trader said.
Shares of PV Drilling, a subsidiary of state oil monopoly PetroVietnam, extended its loss on Thursday to close at 267,000 VND (16.55 US$), down 4.98% from Wednesday.
Shares of the company, which has a price-to-earnings ratio of more than 315 times, have lost around 9.5% after climbing to a record 295,000 VND on Tuesday.
Other losers on Thursday included cable maker Sacom and real estate firm Thu Duc Housing Co. which fell 4.65% and 4.78%, respectively.
The price-to-earnings ratio for most stocks listed on the benchmark Ho Chi Minh City Securities Trading Center is in the 25 to 30 times range compared with the regional average of 18 to 20 times.
Last year, the index was one of the fastest-growing in the world at 144.5%, with much of the increase coming in November and December as companies rushed to qualify for tax breaks by listing before year-end.
Source: Thanh Nien
Thursday, January 25, 2007
6 measures to control securities market
The Ministry of Finance and State Securities Commission of Vietnam (SSC) have announced six measures to control the securities market to help investors understand and make correct decisions on their investment.
First, under the instruction of the Prime Minister, the room on foreign holdings in listed-entities will temporarily stay the same. Currently, foreign investors are allowed to hold a maximum of 49% stake in listed companies and 30% in listed banks.
Secondly, SSC has worked with the State Bank of Vietnam to promote co-ordination in supervising activities relating to loans for securities investment, securities mortgage by commercial banks. The two agencies shall also boost co-ordination in monitoring inward and outward foreign capital flows related to securities investment.
Thirdly, SSC shall organise delegations to investigate securities companies which are currently criticised by investors for their unfair performance in executing customers’ orders or delay depository services of shares of some listed companies. All violations shall be settled in conformity with the law.
Fourthly, SSC asks listed companies to quickly announce information on their financial activities in 2006 to help investors have reasonable decisions in their securities trading activities.
Especially, the SSC shall ask listed companies to public official information in case there are rumours on the market such as the merger and acquisition of certain listed companies.
Fifthly, SSC will require the re-registration of foreign investment funds’ representative offices operating in Vietnam. Before, these offices got operating licences by the Ministry of Trade. According to the Securities Law which became effective on January 1 2007, SSC asks these institutions to re-register with the agency.
Besides, those authorized to invest in the Vietnamese stock exchange from foreign accounts shall have to report to the SSC on their investments. This regulation is especially applicable for funds set up abroad but authorising individuals to invest in the local market.
Finally, SSC shall strengthen dissemination of public information on the market and securities, enabling people to understand the workings of the market.
Especially, SSC shall give analysis and evaluation of the market and announcement of information on financial indices, like price-earning (P/E) ratio to provide investors with necessary information to make their investment decisions.
Source: VNE
First, under the instruction of the Prime Minister, the room on foreign holdings in listed-entities will temporarily stay the same. Currently, foreign investors are allowed to hold a maximum of 49% stake in listed companies and 30% in listed banks.
Secondly, SSC has worked with the State Bank of Vietnam to promote co-ordination in supervising activities relating to loans for securities investment, securities mortgage by commercial banks. The two agencies shall also boost co-ordination in monitoring inward and outward foreign capital flows related to securities investment.
Thirdly, SSC shall organise delegations to investigate securities companies which are currently criticised by investors for their unfair performance in executing customers’ orders or delay depository services of shares of some listed companies. All violations shall be settled in conformity with the law.
Fourthly, SSC asks listed companies to quickly announce information on their financial activities in 2006 to help investors have reasonable decisions in their securities trading activities.
Especially, the SSC shall ask listed companies to public official information in case there are rumours on the market such as the merger and acquisition of certain listed companies.
Fifthly, SSC will require the re-registration of foreign investment funds’ representative offices operating in Vietnam. Before, these offices got operating licences by the Ministry of Trade. According to the Securities Law which became effective on January 1 2007, SSC asks these institutions to re-register with the agency.
Besides, those authorized to invest in the Vietnamese stock exchange from foreign accounts shall have to report to the SSC on their investments. This regulation is especially applicable for funds set up abroad but authorising individuals to invest in the local market.
Finally, SSC shall strengthen dissemination of public information on the market and securities, enabling people to understand the workings of the market.
Especially, SSC shall give analysis and evaluation of the market and announcement of information on financial indices, like price-earning (P/E) ratio to provide investors with necessary information to make their investment decisions.
Source: VNE
Ice-cream maker prepares IPO
Ki Do Ice-Cream Joint Stock Co, or Kido’s is set to issue 2 million shares on February 2 to raise capital for projects.
The issue is expected to attract at least 70 billion VND (4.3mio US$) for expansion projects in the northern region.
As planned, 1.2mio US$ shares will be offered for strategic partners and the rest for outsiders via an auction which is scheduled to take place at the Ho Chi Minh City Securities Trading Center.
The auction’s starting price is set at 27,000 VND against the face value of 10,000 VND each.
Ki Do Joint Stock Co., is the successor of Wall’s – an ice-cream brand of Unilever sold out to Kinh Do Group in 2003 at a price of 20mio US$.
The company schemes to build a factory to produce yogurt and puddings with an annual capacity of three million liters.
The ice-cream producer also focuses on boosting shipments of its middle and high-end products in the near future.
Its current facility in Tay Bac Cu Chi Industrial Park, outlying Cu Chi District has annual capacity of nine million liters.
Kido’s with chartered capital of 40 billion VND (2.5mio US$) is targeting 30% annual output growth.
Vietnam’s ice-cream consumption averages out at half of a liter per capita- the low rate signals big potentials for Kido’s target.
Kido now offers 36 ice-cream products under two brands, Merino and Kido’s Premium, enjoying 60 per cent market share of the popular middle-class ice-cream segment.
The Kido Ice-cream Joint Stock Company became the first business of its kind in Vietnam to receive the international quality management system certificate on food safety control – HACCP (Hazard Analysis and Critical Control Point) in 2005.
The HACCP given to companies by the organization Quacert Vietnam – a division of the Ministry of Science, Technology and Environment is a pre-requisite for food manufacturers to enter the global marketplace.
Kido’s products are shipped to Taiwan and Cambodia.
Source: Thanh Nien
The issue is expected to attract at least 70 billion VND (4.3mio US$) for expansion projects in the northern region.
As planned, 1.2mio US$ shares will be offered for strategic partners and the rest for outsiders via an auction which is scheduled to take place at the Ho Chi Minh City Securities Trading Center.
The auction’s starting price is set at 27,000 VND against the face value of 10,000 VND each.
Ki Do Joint Stock Co., is the successor of Wall’s – an ice-cream brand of Unilever sold out to Kinh Do Group in 2003 at a price of 20mio US$.
The company schemes to build a factory to produce yogurt and puddings with an annual capacity of three million liters.
The ice-cream producer also focuses on boosting shipments of its middle and high-end products in the near future.
Its current facility in Tay Bac Cu Chi Industrial Park, outlying Cu Chi District has annual capacity of nine million liters.
Kido’s with chartered capital of 40 billion VND (2.5mio US$) is targeting 30% annual output growth.
Vietnam’s ice-cream consumption averages out at half of a liter per capita- the low rate signals big potentials for Kido’s target.
Kido now offers 36 ice-cream products under two brands, Merino and Kido’s Premium, enjoying 60 per cent market share of the popular middle-class ice-cream segment.
The Kido Ice-cream Joint Stock Company became the first business of its kind in Vietnam to receive the international quality management system certificate on food safety control – HACCP (Hazard Analysis and Critical Control Point) in 2005.
The HACCP given to companies by the organization Quacert Vietnam – a division of the Ministry of Science, Technology and Environment is a pre-requisite for food manufacturers to enter the global marketplace.
Kido’s products are shipped to Taiwan and Cambodia.
Source: Thanh Nien
Hanoi Beer brewery plans to equitize
The Vietnamese government has approved a plan to equitize and list the Hanoi Beer Company, the country's second largest brewer, to raise money to increase production, a government report said Wednesday.
Less than 10% of the compnay known as Habeco would be sold to a foreign investor and shares would be listed on one of the country's two stock exchanges, said the report published on the government Web site.
"The state will retain 76% of the company at the time of the initial public offering, but this stake will be reduced to no less than 51% later," it said.
Industry sources said Denmark's Carlsberg was interested in buying a stake in Habeco, whose best-selling brand is Bia Hanoi.
Habeco, which has a registered capital of 2 trillion VND (124mio US$), signed a cooperation agreement with Carlsberg in 2005.
Vietnam's beer market, averaging 8% growth per year, has attracted the interest of a string of foreign brewers, including Anheuser-Busch, the owner of the Budweiser brand, and Belgium's Inbev.
State-run Saigon Beer, or Sabeco, the country's largest brewer, has also announced plans to partly equitize.
Source: Thanh Nien
HSBC enters Vietnamese insurance market
The HSBC Life International Limited has become the first Hong Kong life insurance company to open a representative office in Ha Noi.
Speaking at the opening ceremony on Jan. 24, Bruce Howe, chief office representative said that Viet Nam's developing economy, its admission to the World Trade Organisation and the big progresses in the country's insurance sector have attracted foreign investors' attention.
This have created a competitive and promising market for insurance companies, he added.
"We want to be an important member of the market. This is a start of a real business opportunity," said Bruce Howe.
HSBC Life International Limited is an affiliate of the HSBC Insurance (Asia Pacific) Holdings Limited, a leading company in Hong Kong, China, in providing medical and life insurance as well as pension products.
Source: VNA
Wednesday, January 24, 2007
Bibica builds factory
The Bien Hoa Confectionery Joint Stock Company (Bibica) began work Monday on its third factory with the first phase to cost 78.9 billion VND (4.9mio US$). Using Italian technology, the plant, in My Phuoc Industrial Park 1 in the southern province of Binh Duong, will produce yearly 2,500 tons of cream and chocolate cakes. It will start operation in August this year.
The second phase will be completed next year at 100 billion VND (6.2mio US$) to manufacture health products.
Bibica was one of the first 10 companies to list on the Ho Chi Minh City Securities Trading Center. Its pre-tax profit last year was 15 billion VND (933,000 US$) on a turnover of 341.3 billion VND (21mio US$). Its previous factories are in Dong Nai near HCMC and Hanoi.
Source: Thanh Nien
The second phase will be completed next year at 100 billion VND (6.2mio US$) to manufacture health products.
Bibica was one of the first 10 companies to list on the Ho Chi Minh City Securities Trading Center. Its pre-tax profit last year was 15 billion VND (933,000 US$) on a turnover of 341.3 billion VND (21mio US$). Its previous factories are in Dong Nai near HCMC and Hanoi.
Source: Thanh Nien
Vietnamese government sells bonds
The Vietnamese government has raised 300 billion VND (18.8mio US$) through a bond issue on the Hanoi Securities Trading Center.
The five-year bonds, oversubscribed by nearly seven times, have a face value of 100,000 VND and a coupon of 8.2% per annum.
They will be issued on January 24 and listed in both Hanoi and Ho Chi Minh City.
The Ministry of Finance said recently it was restructuring the bond market to boost liquidity and transparency to attract investors and ensure funds for an economy growing at 8% a year.
Too many types of government bonds were now listed on the stock market and their small, fragmented nature limited the market’s development.
Starting this year, government bond issues would be larger and be traded on the Hanoi over-the-counter market.
The government planned to raise 500mio US$ to 1 billion US$ on the global bond market in the first quarter of this year, more than a year after raising 750mio US$ in its first sovereign bond issue.
The proceeds of the bond, with a maturity of 10 or 20 years, would be allocated to several companies, including Electricity of Vietnam, which too plans to issue global corporate bonds to raise 150mio US$.
Source: Thanh Nien
Tuesday, January 23, 2007
Deutsche Bank sees high demand for Vietnamese bonds
Deutsche Bank said that Vietnam had built an excellent rapport with international investors following its issue of 10-year government bonds worth 750mio US$ two years ago.
The issue had created a pricing benchmark for Vietnam in international debt markets, and successfully opened up the country's capital market to foreign investors.
"Appetite internationally is currently very strong for Vietnam. International investors can absorb a huge number of issues from Vietnamese companies", according M. Luk (International Capital Markets Asia at Deutsche Bank)
In another issue, Electricity of Vietnam (EVN) made a 1 trillion VND (62.5mio US$) issue in November 2006 which was advised by Deutsche Bank, VinaCapital, and its EVN-affiliated An Binh Bank. It was sold mostly to offshore investors and was three times over-subscribed.
Source: VNA
The issue had created a pricing benchmark for Vietnam in international debt markets, and successfully opened up the country's capital market to foreign investors.
"Appetite internationally is currently very strong for Vietnam. International investors can absorb a huge number of issues from Vietnamese companies", according M. Luk (International Capital Markets Asia at Deutsche Bank)
In another issue, Electricity of Vietnam (EVN) made a 1 trillion VND (62.5mio US$) issue in November 2006 which was advised by Deutsche Bank, VinaCapital, and its EVN-affiliated An Binh Bank. It was sold mostly to offshore investors and was three times over-subscribed.
Source: VNA
BNP Parisbas finances 30% of oil refinery
French bank BNP Paribas has agreed with Vietnam's Finance Ministry to a 13-year 300mio US$ deal to build the country's first oil refinery, according to official sources.
The amount "is part of the 1.0 billion US$ that the ministry of finance is responsible to arrange and mobilize for the Dung Quat oil refinery according to the assignment by the government," a bank official told AFP.
The signing ceremony should be organized soon, he said.
Vietnam's government website said the loan carries an annual interest rate of 6.78% and was approved on Monday by Deputy Prime Minister Nguyen Sinh Hung, on behalf of Prime Minister Nguyen Tan Dung.
The total project, which is considered a major step towards energy autonomy for the communist nation, is expected to cost the state-owned PetroVietnam around 2.5 billion US$.
It is carried out by the Technip group of France, leading a consortium including the Japanese engineering giant JGC Corporation and Spain's Tecnicas Reunidas.
Dung Quat, 120 kilometres (75 miles) south of the central city of Danang, was picked as the site partly as Vietnam wants to develop an industrial counterweight between the two existing economic poles, Hanoi and Ho Chi Minh City.
Source: AFP
The amount "is part of the 1.0 billion US$ that the ministry of finance is responsible to arrange and mobilize for the Dung Quat oil refinery according to the assignment by the government," a bank official told AFP.
The signing ceremony should be organized soon, he said.
Vietnam's government website said the loan carries an annual interest rate of 6.78% and was approved on Monday by Deputy Prime Minister Nguyen Sinh Hung, on behalf of Prime Minister Nguyen Tan Dung.
The total project, which is considered a major step towards energy autonomy for the communist nation, is expected to cost the state-owned PetroVietnam around 2.5 billion US$.
It is carried out by the Technip group of France, leading a consortium including the Japanese engineering giant JGC Corporation and Spain's Tecnicas Reunidas.
Dung Quat, 120 kilometres (75 miles) south of the central city of Danang, was picked as the site partly as Vietnam wants to develop an industrial counterweight between the two existing economic poles, Hanoi and Ho Chi Minh City.
Source: AFP
FPT raised revenues by 42%
FPT said strong hardware sales including mobile phone handsets boosted its revenues in 2006 by 42.4% from 2005 to 11.69 trillion Dong (724mio US$).
"FPT hopes to continue to sustain its growth and effectiveness in 2007 to meet all its strategic targets."
Source: REUTERS
"FPT hopes to continue to sustain its growth and effectiveness in 2007 to meet all its strategic targets."
Source: REUTERS
International interest in Vietnamese stock market
An executive of an investment fund affirmed, on Jan. 22, that foreign investors would pay more attention to the Vietnamese securities market as Viet Nam now gained World Trade Organisation (WTO) membership.
"Viet Nam's entry into the WTO will not have direct impact on the Vietnamese stock exchange, but foreign investors will pay more attention to the market," Dominic Scriven, Director of Dragon Capital, said in an interview with the VNA. "During the process of international integration, the stock exchange will be adjusted by practices on the world market."
Scriven said that the year 2006 witnessed many big leaps in the Vietnamese stock market, with VN-Index soaring and the growing number of listed companies, from 38 to 156, on both Ha Noi and Ho Chi Minh City Securities Trading Centres.
He cited the enactment of the Law on Securities as last year's another important development. "The law has created a legal foundation for operation of the securities market. In the mid-and long-term, its introduction is particularly significant to the stock market of Viet Nam," he said.
Commenting upon experts' opinions that the Vietnamese stock market is growing too hot, with the price-to-earnings (P/E) ratio of various kinds of shares being high in comparison with the level in the world market, Scriven said for a new market like the Vietnamese stock exchange, it was difficult to say what P/E ratio is appropriate. He added that for the time being, P/E ratio can be up or down, but it will then reach a balanced point.
When asked why many foreign investors, both individuals and organisations, still kept buying shares although the prices of various kinds of shares were too high, he said that if a majority of investors share a similar view, their view will become a common view of the market.
"Investors themselves decide to buy or sell shares and nobody interferes with their decisions. We only recommend that they carefully consider before making investment decision," the director said.
Source: VNA
"Viet Nam's entry into the WTO will not have direct impact on the Vietnamese stock exchange, but foreign investors will pay more attention to the market," Dominic Scriven, Director of Dragon Capital, said in an interview with the VNA. "During the process of international integration, the stock exchange will be adjusted by practices on the world market."
Scriven said that the year 2006 witnessed many big leaps in the Vietnamese stock market, with VN-Index soaring and the growing number of listed companies, from 38 to 156, on both Ha Noi and Ho Chi Minh City Securities Trading Centres.
He cited the enactment of the Law on Securities as last year's another important development. "The law has created a legal foundation for operation of the securities market. In the mid-and long-term, its introduction is particularly significant to the stock market of Viet Nam," he said.
Commenting upon experts' opinions that the Vietnamese stock market is growing too hot, with the price-to-earnings (P/E) ratio of various kinds of shares being high in comparison with the level in the world market, Scriven said for a new market like the Vietnamese stock exchange, it was difficult to say what P/E ratio is appropriate. He added that for the time being, P/E ratio can be up or down, but it will then reach a balanced point.
When asked why many foreign investors, both individuals and organisations, still kept buying shares although the prices of various kinds of shares were too high, he said that if a majority of investors share a similar view, their view will become a common view of the market.
"Investors themselves decide to buy or sell shares and nobody interferes with their decisions. We only recommend that they carefully consider before making investment decision," the director said.
Source: VNA
Vietnam tightens loan regulations to securities companies
Viet Nam bans credit organisations to lend the money to affiliate securities companies for trading in securities.
The ban was clearly stated in a decision dated Jan. 20 signed by Governor of the State Bank of Viet Nam, Le Duc Thuy.
Credit organisations are permitted to lend the money to non-affiliate securities companies on condition these companies have property to guarantee their loans.
Loans or financial guarantees to securities companies whose capital is contributed and managed by banks, will not exceed 10% of their capital, the decision said.
Meanwhile, loans and guarantees to other securities companies must be below 20% of their capital.
"Setting this limitation is necessary," Governor Thuy said, adding the move is aimed at preventing the danger of collapse and inability to secure payments by banks as the securities market is overheating.
According to Thuy, many investors have used up to more than 50% of their loans to purchase shares on the securities market, which posted an average growth rate of 30% within a month.
Together with the State Bank of Viet Nam's decision, the State Securities Commission said it will employ a score of measures to ensure sustainable and healthy growth for the securities market.
The commission will regularly send inspectors to securities companies to track down signals of spied transactions and encourage them to publish their 2006 financial reports.
The commission will also increase its monitoring of the listing of information by listed companies on the market as well as the transaction of listed shares.
Source: VNA
The ban was clearly stated in a decision dated Jan. 20 signed by Governor of the State Bank of Viet Nam, Le Duc Thuy.
Credit organisations are permitted to lend the money to non-affiliate securities companies on condition these companies have property to guarantee their loans.
Loans or financial guarantees to securities companies whose capital is contributed and managed by banks, will not exceed 10% of their capital, the decision said.
Meanwhile, loans and guarantees to other securities companies must be below 20% of their capital.
"Setting this limitation is necessary," Governor Thuy said, adding the move is aimed at preventing the danger of collapse and inability to secure payments by banks as the securities market is overheating.
According to Thuy, many investors have used up to more than 50% of their loans to purchase shares on the securities market, which posted an average growth rate of 30% within a month.
Together with the State Bank of Viet Nam's decision, the State Securities Commission said it will employ a score of measures to ensure sustainable and healthy growth for the securities market.
The commission will regularly send inspectors to securities companies to track down signals of spied transactions and encourage them to publish their 2006 financial reports.
The commission will also increase its monitoring of the listing of information by listed companies on the market as well as the transaction of listed shares.
Source: VNA
Monday, January 22, 2007
Indovina Bank to mobilize funds
Indovina Bank, a Vietnam-Taiwan bank joint-venture has issued its third round of US dollar certificates of deposit (CDs) in Vietnam, aiming to mobilize 20mio US$.
The CDs come with a minimum face value of 500 US$ for individuals and 1,000 US$for institutions.
The CD carries an annual interest rate of 4.4%; 4.75%; and 5.2% for CDs of three-month; six-month; and 360-day terms respectively.
The issue is to last until February 16.
Indovina, a 50:50 joint venture between the Industrial and Commercial Bank of Vietnam and Taiwan’s Cathay United Bank has recently obtained approval from the State Bank of Vietnam to issue debit cards and introduce the banking service of payment through debit cards.
As proposed in the first phase, the bank would install about 10 automatic teller machines (ATMs) at Indovina’s branches and transaction offices in the country.
It was now negotiating with partners to network its card system in Vietnam, and would finish the job in the first quarter this year, the bank representative said.
The bank is also to open four more branches and transaction offices in the first quarter this year and issue about 70,000 ATM cards in the first phase.
The bank’s customers, mostly Taiwanese and joint venture corporations, have strong demands to use ATM cards, especially in paying salaries to their employees through ATM accounts.
Indovina plans to scale up its chartered capital to between 45 and 70mio US$ by the year’s end from the current 35mio US$.
It last year earned a profit of 9mio US$, increasing 60% against the previous year.
As of late last year, its total assets were 337mio US$, up 94mio US$ on the year earlier.
Source: Thanh Nien
The CDs come with a minimum face value of 500 US$ for individuals and 1,000 US$for institutions.
The CD carries an annual interest rate of 4.4%; 4.75%; and 5.2% for CDs of three-month; six-month; and 360-day terms respectively.
The issue is to last until February 16.
Indovina, a 50:50 joint venture between the Industrial and Commercial Bank of Vietnam and Taiwan’s Cathay United Bank has recently obtained approval from the State Bank of Vietnam to issue debit cards and introduce the banking service of payment through debit cards.
As proposed in the first phase, the bank would install about 10 automatic teller machines (ATMs) at Indovina’s branches and transaction offices in the country.
It was now negotiating with partners to network its card system in Vietnam, and would finish the job in the first quarter this year, the bank representative said.
The bank is also to open four more branches and transaction offices in the first quarter this year and issue about 70,000 ATM cards in the first phase.
The bank’s customers, mostly Taiwanese and joint venture corporations, have strong demands to use ATM cards, especially in paying salaries to their employees through ATM accounts.
Indovina plans to scale up its chartered capital to between 45 and 70mio US$ by the year’s end from the current 35mio US$.
It last year earned a profit of 9mio US$, increasing 60% against the previous year.
As of late last year, its total assets were 337mio US$, up 94mio US$ on the year earlier.
Source: Thanh Nien
Saturday, January 20, 2007
SACOMBANK prepares stock split
Sacombank will make a 1:2 rights issue this year to raise 1.45 trillion VND (90mio US$), increasing its chartered capital to 3.55 trillion VND (221mio US$).
Some three million shares will also be offered to key executives at 15,000 VND.
A spokesperson for the bourse-listed Saigon Thuong Tin Commercial Bank – to give its official name – said Thursday the issue price and a detailed plan to expand capital and branch network this year would be presented at a shareholders’ meeting in March.
The bank’s stock rose by 4.4% to 83,000 VND on the stock market Thursday.
Sacombank has projected pre-tax profit of 845 billion VND (52.6mio US$) this year, up 55% from last year.
Its outstanding loans at the end of last year were 73% higher year-on-year at 14.54 trillion VND (905mio US$). Deposits increased 75% to 21.52 trillion VND (1.3 billion US$).
The bank has three foreign strategic shareholders, the World Bank's International Finance Corp., Dragon Capital and ANZ Bank , which altogether held 26.3% of stake.
Another sources said the central bank might lift the cap on foreign investors’ holdings in the bank.
Source: Thanh Nien
Some three million shares will also be offered to key executives at 15,000 VND.
A spokesperson for the bourse-listed Saigon Thuong Tin Commercial Bank – to give its official name – said Thursday the issue price and a detailed plan to expand capital and branch network this year would be presented at a shareholders’ meeting in March.
The bank’s stock rose by 4.4% to 83,000 VND on the stock market Thursday.
Sacombank has projected pre-tax profit of 845 billion VND (52.6mio US$) this year, up 55% from last year.
Its outstanding loans at the end of last year were 73% higher year-on-year at 14.54 trillion VND (905mio US$). Deposits increased 75% to 21.52 trillion VND (1.3 billion US$).
The bank has three foreign strategic shareholders, the World Bank's International Finance Corp., Dragon Capital and ANZ Bank , which altogether held 26.3% of stake.
Another sources said the central bank might lift the cap on foreign investors’ holdings in the bank.
Source: Thanh Nien
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