VietNamNet Bridge – January 2018 witnessed many IPOs of large corporations, including Binh Son Petrochemistry & Refinery JSC (BSR, UpCom), PVOil (OIL, UpCom), PVPower (POW, UpCom) and the Vietnam Rubber Group (GVR, UpCom).
The total amount of money collected from the four IPOs was VND17.9 trillion, or $785 million. If counting some smaller IPOs, including Vinafood II ($51 million), Hapro ($39 million) and GENCO 3 ($8 million), the total amount is roughly $1 billion.
While BSR, PVOil and PVPower successfully concluded their IPOs, others had unsatisfactory IPOs. Investors believed that the enterprises were overvalued.
An analyst commented that the success of an IPO or state’s divestment campaign can be seen not only in the prices of shares when listed, but also in the prestige of enterprises.
The Ministry of Finance announced that two enterprises have received approval for their plans to have an IPO, slated for the second quarter of 2018. They are Phuoc An – Dak Nong and Van Tuong, with valuation at VND987 billion.
2018 is the third year the government has implemented the 5-year (2016-2020) economic development plan, under which business environment and institutional reform are the top priority tasks.
Rong Viet Securities, in its report, said that the stock market, as the economy’s barometer, will be the first channel to reflect positive movements. 2018 will still be a prosperous year for the Vietnamese market because of foreign capital flow and the 48 percent VN Index rise in 2017.
The share supply in 2018 is expected to increase sharply. These will include shares of state-owned enterprises that have IPOs, newly listed shares, and additionally issued shares.
The reasonable range for the VN Index in 2018 is 1,151 – 1,170 points, according to Rong Viet.
BIDV Securities predicted that the listed stock market’s value would increase to $150-160 billion, thus raising market capitalization value to 73-75 percent of GDP, once equitization and state divestment step up this year.
Regarding liquidity, BIDV Securities predicted that the average liquidity will be $272 million per trading session, an increase of 25 percent over 2017.
Chair of the State Securities Commission (SSC) Tran Van Dung said that a series of large state-owned enterprises would be equitized from now to the end of 2019, namely Vinataba (tobacco), Vietnam Paper Corporation, MobiFone (telecommunication), Vinacafe, the subsidiaries of VNPT, Vinachem (chemicals) and Vinacomin (miner).
In the first three months of the year, the VN Index increased by 19.3 percent, putting Vietnam among the stock markets with the highest growth rates in the world, outstripping Egypt (15.52 percent) and Brazil (11.73 percent).