FPT Digital Retail Joint Stock Company is planning its initial public offering (IPO) on December 15 and seeking to debut its shares on the HCM Stock Exchange prior to April next year.
The FPT Corporation’s retail arm is the second biggest mobile handset retailer after The Gioi Di Dong (Mobile World), with over 450 shops nationwide. Its IPO is expected to be a magnet, similar to the Mobile World Investment Corporation’s IPO in 2014, given the lucrative outlook of Viet Nam’s retail market.
During a roadshow on December 1, Nguyen Viet Anh, deputy chief executive officer of FPT Digital Retail, said the company expected to collect total revenues of about US$600 million in 2017, 10 per cent of which would come from online sales.
Its profit is estimated to be VND293 billion (roughly $13 million) by the year-end.
The retail company also plans to pay dividend in the form of stocks at the rate of 100 per cent (one shareholding will receive one new share) this year.
The pricing for the IPO has not been revealed, but the book value per share of the company was VND34,525 apiece by the end of September.
FPT Corporation is now its biggest stakeholder having 55 per cent of its capital, followed by Dragon Capital with a holding of 20 per cent and VinaCapital with 15 per cent. The last 10 per cent are owned by the company’s employees.
Founded in 2012 with current charter capital of VND400 billion, FPT Digital Retail is Viet Nam’s second biggest distributor of digital devices with two retail chains, including FPT Shop, which sells technology products of various manufacturers, while F.Studio distributes premium Apple products and accessories (Apple premium reseller).
Consumer loan-driven growth
FPT Retail has targeted an average annual growth rate of 24 per cent in the next five years, projecting total revenues and profits of VND25 trillion and VND650 billion by 2020.
The company will continue to expand its networks by an additional 100 shops in the next two years to increase the number of total outlets to 650-700 by 2020.
Besides seeking to increase the customer loyalty towards FPT shops, FPT Retail targets potential customers working in enterprises in Viet Nam by providing loans to finance their purchases at shops. The company offers credit lines based on the employees’ positions in the companies.
Nguyen Bach Diep, chairman and CEO of FPT Retail, said the company was stepping up consumer lending, revealing that 30 per cent of its customers buy on instalments. Since October 2016, FPT Retail has connected with 10 banks and 1,000 enterprises.
In addition to this, the company is also focusing on the expansion of F.Studio, which is expected to reach 100 shops by 2020 to tap the potential market for Apple products, estimated to be worth $1 billion in Viet Nam.
Photo: CBR Investment AG