EN-Foreign invested firms select to list on Vietnam’s stock market (Hanoi Times 6.2018)
Foreign invested firms select to list on Vietnam’s stock market
Updated at Wednesday, 27 Jun 2018, 13:15
The Hanoitimes - Vietnam’s stock market has become more attractive to foreign invested enterprises (FIE) as some of them have chosen to list here to leverage its high growth.
Taiwan (China)-headquartered Vietnam Fortress Tools JSC on June 25 announced to become a public company after receiving the approval from the State Securities Commission.
Earlier, the company released that it would list more than 26.8 million shares on the Hanoi Stock Exchange. Vi Nguyet Cam, Fortress investor relations manager and head of the supervisory board, said that the company has demand for capital to expand its production so it will list on the Vietnamese bourse. She expects its shares to start off at VND40,000 to VND60,000 (US$1.78-2.67) apiece.
The company’s earnings per share (EPS) for 2017 sit at VND3,602 (US$0.16), while earnings per share (EPS) for 2018 is forecast at VND5,945 (US$0.26). The price-to-earnings ratio (P/E) stands at 6.94 for 2017 and is estimated at 6.73 for this year.
With its capitalization value of US$50-60 million which may double in the next three years, Fortress may be listed among mid-cap stocks in Vietnam. Meanwhile, if listing shares on other large markets, Fortress Tools would be listed as micro-cap only, which would make it more difficult to compete in raising funds.
According to Cam, Fortress has an ambition to become a lucrative listed foreign-invested enterprise (FIE) on the local stock exchange, paving a new trend for other FIEs in Vietnam.
Earlier, Jollibee Foods Corp from the Philippines is also going ahead with an IPO for its Highlands Coffee chain by 2019. The fast-food giant and its joint venture partner Viet Thai International JSC last year adjusted their respective ownership in SuperFoods to 60-40% from the previous 50-50 holding share, a move aimed to make SuperFoods a public company by July next year.
“To help fund SuperFoods’ expansion plans, Jollibee Foods Corporation, will henceforth take the lead in the capital raising activities for the joint venture and will work with various financial institutions in Vietnam and other parts of Asia in this undertaking,” Jollibee said.
Last year, the market also saw Siam Brothers, a rope manufacturer from Thailand, listed its shares on the Ho Chi Minh Stock Exchange.
Investors’ confidence remains high
Foreign investors have been choosing Vietnam not only to set up production bases, but also to list their shares. This is good news for Vietnam, which wants foreign investors to retain profits in Vietnam for re-investment in the country, experts said.
In addition, the decisions by FIEs also show the attractiveness of the Vietnamese stock market.
The Vietnam stock market in 2017 experienced a prosperous year and jumped to the third position, accounting for 18% of MSCI’s (Morgan Stanley Capital International) frontier markets’ basket of indicators, just after Argentina and Kuwait.
Despite an interest rate hike of the US Federal Reserve (Fed) and a correction in Vietnam’s stock market recently, Chairman of State Securities Commission (SSC) Tran Van Dung recently said that the foreign inflows in Vietnam to date this year have shown positive movements in general.
Dung cited SSC’s estimates as saying that except for February 2018 when foreign investors net withdrew about US$32 million, January and March 2018 both recorded net buying of foreign investors with respectively US$670 million and US$270 million. The net buying value has increased recently to US$617 million in April 2018 and over US$700 million in May 2018.
Meanwhile, the investors’ confidence in Vietnam’s economic prospects and businesses’ performances have been also high, fuelled by optimistic forecast of large financial institutions. Notably, the Asian Development Bank predicts that Vietnam’s GDP might grow by 7.1% this year to become one of the region’s fastest-growing economies.
 Jollibee Foods Corp plans to make an IPO for its Highlands Coffee chain by 2019. |
The company’s earnings per share (EPS) for 2017 sit at VND3,602 (US$0.16), while earnings per share (EPS) for 2018 is forecast at VND5,945 (US$0.26). The price-to-earnings ratio (P/E) stands at 6.94 for 2017 and is estimated at 6.73 for this year.
With its capitalization value of US$50-60 million which may double in the next three years, Fortress may be listed among mid-cap stocks in Vietnam. Meanwhile, if listing shares on other large markets, Fortress Tools would be listed as micro-cap only, which would make it more difficult to compete in raising funds.
According to Cam, Fortress has an ambition to become a lucrative listed foreign-invested enterprise (FIE) on the local stock exchange, paving a new trend for other FIEs in Vietnam.
Earlier, Jollibee Foods Corp from the Philippines is also going ahead with an IPO for its Highlands Coffee chain by 2019. The fast-food giant and its joint venture partner Viet Thai International JSC last year adjusted their respective ownership in SuperFoods to 60-40% from the previous 50-50 holding share, a move aimed to make SuperFoods a public company by July next year.
“To help fund SuperFoods’ expansion plans, Jollibee Foods Corporation, will henceforth take the lead in the capital raising activities for the joint venture and will work with various financial institutions in Vietnam and other parts of Asia in this undertaking,” Jollibee said.
Last year, the market also saw Siam Brothers, a rope manufacturer from Thailand, listed its shares on the Ho Chi Minh Stock Exchange.
Investors’ confidence remains high
Foreign investors have been choosing Vietnam not only to set up production bases, but also to list their shares. This is good news for Vietnam, which wants foreign investors to retain profits in Vietnam for re-investment in the country, experts said.
In addition, the decisions by FIEs also show the attractiveness of the Vietnamese stock market.
The Vietnam stock market in 2017 experienced a prosperous year and jumped to the third position, accounting for 18% of MSCI’s (Morgan Stanley Capital International) frontier markets’ basket of indicators, just after Argentina and Kuwait.
Despite an interest rate hike of the US Federal Reserve (Fed) and a correction in Vietnam’s stock market recently, Chairman of State Securities Commission (SSC) Tran Van Dung recently said that the foreign inflows in Vietnam to date this year have shown positive movements in general.
Dung cited SSC’s estimates as saying that except for February 2018 when foreign investors net withdrew about US$32 million, January and March 2018 both recorded net buying of foreign investors with respectively US$670 million and US$270 million. The net buying value has increased recently to US$617 million in April 2018 and over US$700 million in May 2018.
Meanwhile, the investors’ confidence in Vietnam’s economic prospects and businesses’ performances have been also high, fuelled by optimistic forecast of large financial institutions. Notably, the Asian Development Bank predicts that Vietnam’s GDP might grow by 7.1% this year to become one of the region’s fastest-growing economies.
Thao Le