Petrolimex enjoys huge benefits through treasury stock sale

The Viet Nam National Petroleum Group (Petrolimex) has announced the sale of all 20 million registered treasury shares at a transaction value five times higher than par value.

According to the group, the shares were purchased at an average price of VND50,553 (US$2.22) from May 4 to 23 through transactions at the HCM Stock Exchange.

The sale helps draw Petrolimex’s stock closer to joining the VN30 Index, which tracks the performance of the 30 largest firms by market capitalisation. It is required that stocks of all the company in the list must have free-float rate of at least 5 per cent.

Before being listed on the stock market, the Petrolimex rate was 3.6 per cent.

Petrolimex owns more than 135 million treasury stocks after the sale.

Bamboo Capital targets 30 per cent growth     

Bamboo Capital JSC has set revenue and profit targets of VND1.77 trillion (US$78.3 million) and VND81 billion this year, 8 per cent and 30 per cent higher than last year.

Speaking at the annual shareholders meeting in HCM City on Thursday, Nguyen Thanh Hung, BCG’s deputy general director, said in the short term, exports would be the main contributor to revenues and profit.

This year, the company plans to increase exports of cocoa, cassava starch, coffee and micro-organic fertilisers.

It will speed up work on a BOT project to widen and upgrade DT830 road in Long An Province and do a study on building a part of the North - South expressway project, social housing for workers in Long An Province, and other projects.

Renewable energy, especially solar, is also in its long-term plans, Hung said. BCG has already received approval to build four solar farms, including two in Long An.

Nguyễn Hồ Nam, BCG’s chairman, said South Korea’s Green Eggs Co., Ltd, which owns a 3.5 per cent stake in BCG, plans to invest an additional $10 million in the company for the solar projects in Long An.

Nam said agricultural production and trading, infrastructure, real estate and renewable energy are among the company’s core businesses in the 2017-20.

In 2015-17, agriculture accounted for the biggest share of profits, but from 2020 renewable energy, infrastructure and real estate would take over, he said.

The company did not pay dividends last year but will be 6 per cent for 2017. 

Sacom Investment makes fruitful start to year     

Sacom Investment and Development Joint Stock Company (SAM Holdings), a telecom manufacturer and distributor, reported good numbers for the first quarter.

It has achieved revenues of VND481 billion (US$21 million), or 33 per cent of its full-year target.

Net profit was VND29 billion ($1.2 million), or 30 per cent of the target.

SAM attributed the high revenues to financial investment, which brought in VND94.5 billion ($4.1 million), 45 per cent higher than in the whole of last year.

The company said selling its stake in Hiep Phu Real Estate Company had yielded a profit of 66 per cent.

It is withdrawing from certain projects and plans to invest that money elsewhere for higher returns, it said. 

UPCoM gets new classification rules     

The Ha Noi Stock Exchange (HNX) recently issued a stock classification code on the Unlisted Public Company Market (UPCoM), in order to help investors keep closer watch on existing companies’ owners’ equity and prepare to categorise a large number of goods to be released into the market soon.

Classification rules on the UPCoM will categorise registered stocks into three categories, except for stocks on the Investors Warning list.

Under the system, stocks issued by companies or organisations with a registered owner’s equity of more than VND1 trillion (US$44.67 million) will belong to the UPCoM Large category, while stocks from those with VND300 billion ($13.4 million) to VND1 trillion in equity will be classified as UPCoM Medium. The UPCoM Small is for those from VND10 billion ($446,747) to below VND300 million.

These lists will be displayed on the live screens at the HNX’s headquarter in Ha Noi and will be reviewed and updated on an annual basis. There are exceptions for stocks whose companies fail to meet the required level of capital, stocks being replaced by another or exchanged between lists.

UPCoM classification, based on levels of current capital, will sort registered companies’ stocks into their respective list according to the company’s owner’s equity, which will be calculated from the closest balance sheet stated in the latest audited and published financial report.

In case the registered organisation is the mother company of another firm or is a firm with non legal entity subsidiaries, owner’s equity will simply be based on audited financial reports.

The new classification rule will replace the UPCoM Premium currently being used, and the official list of categorised stocks will be published by the HNX on June 24, 2017 on the occasion of the UPCoM’s eighth year in operation.

For the first five months of 2017, 125 businesses have been newly listed on the UPCoM, with an average of 10.74 million shares being traded each session, amounting to VND202.9 billion ($9.06 million). This marks a 10.2 per cent increase in terms of quantity traded and 62.4 per cent in terms of quality compared to the same period in 2016.

At the end of Thursday’s session, there were a total of 540 listed companies on the UPCoM, with VND419 trillion ($18.71 billion) in capital and VND185.55 trillion ($8.28 billion) in traded value. 

TTC Sugar to take over BHS in a 300m share swap merger

hanh Thanh Cong Tay Ninh Sugar JSC (TTCS) will make a share swap to fully acquire Bien Hoa Sugar JSC in order to create the biggest sugar producer in Viet Nam.

TTCS will issue nearly 304 million shares to convert all outstanding shares of Bien Hoa Sugar at a ratio of 1:1.02. In other words, each share of Bien Hoa Sugar is equal to 1.02 shares of TTCS.

The conversion ratio was calculated by a third-party company that valued each share of TTCS and Bien Hoa Sugar at VND20,944 (93 US cents) and VND21,356, respectively.

The share swap will help TTCS take total control of Bien Hoa Sugar’s capital. The deal will be carried out within 90 days plus additional time (if needed), starting from the day TTCS receives the permit from the State Securities Commission on share issuance.

The merger will increase the chartered capital of TTCS by more than VND3 trillion ($133.3 million) to VND5.57 trillion.

After the merger is completed, Bien Hoa Sugar will be renamed to Thanh Thanh Cong Bien Hoa-Dong Nai Sugar Co Ltd to marks TTCS’s sole ownership of the company.

TTCS expects its combined revenue will reach VND8.35 trillion after the merger, and its combined pre-tax profit will tap VND674 billion.

The merger is also expected to help TTCS accrue a 30 per cent market share in Viet Nam. The new company will have total assets of VND14.67 trillion and total payable assets of VND7.86 trillion.

TTCS shares, listed as SBT on the HCM Stock Exchange, are trading near the all-time high of VND29,000. SBT closed Thursday at VND28,450.

Shares of Bien Hoa Sugar are listed on the same bourse as BHS and also move around the all-time high of VND20,000. BHS ended Thursday at VND20,050.

TTCS chairman Pham Hong Duong said at the company’s extraordinary shareholder meeting held on Thursday that the M&A between the two firms will help TTCS heighten its position in the sugar market and improve its quality of financial management, corporate governance and business operations.

The merger will combine good qualities of two sides, which include a strong retail network and good reputation for Bien Hoa Sugar and good production for TTCS, Duong said. He also said that the post-merger company will be able to create more added values and reduce its total cost.

According to a report presented by Bao Viet Securities (BVSC) at the meeting, the post-merger company will have 40,000ha of total planting area, equal to 16 per cent of total sugarcane area across the country.

The brokerage also said that the post-merger company will have an average annual growth rate of 6.6 per cent, while doubled capital will help the new firm negotiate with suppliers to reduce input costs.

In addition, TTCS will be able to share the retail network of Bien Hoa Sugar to slash its selling cost and increase its profit, resulting in the rise of price of company’s shares and benefiting its shareholders.

Short-term deposit rates forecast to reduce in 2017     

The market research company Market Intello forecast that the average interest rate this year would reduce by 0.5 percentage points compared with 2016.

In the “Vietnam Macroeconomic Report - May 2017” released this week, Market Intello expected the short-term deposit rates to drop to 4.5 per cent for the three-month term and 6.3 per cent for the 12-month term due to inflation management measures of the State Bank of Viet Nam and the Government.

The research company also anticipated that exchange rates would increase by between 1 per cent and 1.5 per cent as the US Federal Reserve’s plans to raise rates twice in June and September may put pressure on the exchange rate.

In addition, the trade deficit may make the demand for US dollars rise much more than in 2016, it said, adding however, that the Vietnamese dong will not be depressed because of the ability to control inflation below 4 per cent and abundant foreign reserves of the State Bank of Viet Nam.

Under the report, Market Intello also maintain its forecast for Viet Nam’s economic growth at 6.1 per cent in 2017.

“Agriculture is expected to recover slightly but the decline in the mining industry will impact the economic growth considerably,” it said.

Market Intello cut the CPI forecast to around 3.8 per cent, explaining that raising electricity prices could push up inflation in the third quarter, but weak domestic demand will hold inflation under the inflation target.

According to Market Intello, boosting investment from the domestic economic sector should be the biggest challenge in improving Viet Nam’s economy for the rest of the year.

“The Government has taken actions to accelerate capital disbursement from the State budget and improve the business environment for the private sector. However, until April 2017, the rate of capital disbursement from the budget was slower than the target rate,” it said. 

VN FDI inflow lags through May     

Foreign direct investment (FDI) into Viet Nam reached US$12.13 billion in the first five months of this year, surging 10.4 per cent against the same period last year.

The period’s FDI increase was much lower than the 40.5 per cent growth seen in the first four months, latest statistics from the Foreign Investment Agency revealed.

On the other hand, FDI disbursement saw a positive rise of 6 per cent to $6.15 billion in five months, compared with a 3.2 per cent increase recorded in four-month capital disbursement.

Some 939 projects with registered capital of $5.59 billion were newly registered from January to May, down 26.1 per cent year-on-year. Additional capital for 437 existing projects stood at $4.74 billion, up 83 per cent year-on-year.

During the reviewed period, foreign investors also contributed capital or bought stake with total value of $1.79 billion, up 116.2 per cent year-on-year.

The processing and manufacturing sector received the most FDI, at $8.09 billion, accounting for 66.7 per cent of the total FDI registered in the country. The mining sector ranked second with $1.28 billion, or 10.5 per cent, while the wholesale and retail sector came third with $798 million, or 6.5 per cent.

South Korea remained Viet Nam’s leading source of foreign investment in five months, with $4.41 billion, contributing 36.4 per cent of the total. It was followed by Japan and Singapore with $1.94 billion, or 16 per cent, and $1.23 billion, or 10.21 per cent, respectively. 

HCM City licenses two foreign projects

The southern hub city on Wednesday granted investment licences to two foreign-invested projects with total registered capital of nearly $90 million, baodautu.vn reported.

The first, Cau Tre food processing factory, worth some $53.5 million, will be built on 7.1ha area in the Hiep Phuoc Industrial Zone. It is financed by CJ Cau Tre Food JSC, a joint venture between State-owned Saigon Trading Corporation (Satra) and CJ Cheijedang Corp, a subsidiary of South Korean conglomerate CJ Group.

The second, invested by Taiwanese Viet Nam Paiho Co, will produce high-quality cloth for sports and healthcare. The $34 million factory will cover 8.2ha in the Le Minh Xuan 3 Industrial Zone. 

Coal exports surge in four months

Vietnam’s total coal export volume in the first four months of the year surged five times from the same time last year to more than 544,000 tonnes, according to statistics from the General Department of Customs.

The department said that Vietnam pocketed 83.6 million USD from coal shipments during the period, a 9.5 times increase year-on-year.

Average coal export price rocketed to nearly 154 USD per tonne, much higher than 79 USD per tonne during January-April in 2016.

Notably, China was no longer Vietnam’s key export market in the period with the major coal importers being Japan and Malaysia.

According to a master plan for the coal sector by 2020 with a vision to 2030, coal output is expected to reach 47-50 million tonnes by 2020 and 55-57 million tonnes by 2030. However, domestic demand for coal is forecast to be double local production output, about 112.3 million tonnes by 2020 and 220.3 million by 2030.

Anti-money laundry system put into use in Orient Bank

The international standard anti-money laundering (AML) system was officially put into use in the Orient Joint Stock Commercial Bank (OCB) on May 25.

The system was installed under a project implemented by the OCB, consultancy firm Fintek Company Limited and Malaysian TESS International. It aims to ensure information security for customers and to prevent money laundering and illegal transactions.

The AML system provides preeminent models and methods to filter customer information based on black lists, warning lists, embargo lists and more. It also discovers and investigates suspicious transactions not in line with customers’ business operations.

According to Dao Minh Anh, OCB’s Deputy General Director in charge of risk management, the project is a significant move in building a transparent management system and complying with legal regulations.

The system demonstrates the bank’s strategy in developing management tools and assuring security in all transactions, she said.

She said that the OCB aims to complete its risk management system in line with Base II standards that include recommendations on banking laws and regulations issued by the Basel Committee on Banking Supervision.

Tax authorities to take closer look at foreign retailers

The General Department of Taxation has asked local tax authorities to inspect foreign retailers operating in Vietnam to see if they are transfer pricing or shifting profits to avoid tax.

Tax authorities will audit corporate, value added and personal income tax paid by these retailers between 2012 and 2016.

The department will also monitor the use of brand names in the form of franchising or ownership transfer among foreign retailers.

Transfer pricing is not illegal per se, but it is a gray area that tax agencies keep a close eye on. Abuse of the practice is often very difficult to prove, especially when it involves multinational corporations with a complex network of internal buyers and suppliers.

Vietnam’s retail market grew 10.2% last year with total sales reaching VND2,670 trillion (US$117.6 billion), according to the General Statistics Office.

The country, recently ranked by A.T. Kearney among the world's top 30 retail markets with the best opportunities, has seen many foreign arrivals.

BigC supermarket chain, MM Mega Market (previously Metro Vietnam), electronics chain Nguyen Kim and Aeon Vietnam are several of the major foreign retailers operating in the country.

In 2015 retail giant Central, run by Thailand's third-richest family, the Chirathivats, made headlines with its US$200 million purchase of a 49% stake in electronics retailer Nguyen Kim, via its subsidiary Power Buy. Then in 2016, Central and Nguyen Kim acquired Vietnam's biggest foreign-owned supermarket chain Big C.

Vietnam's tax authorities last year gave Big C Vietnam a tax bill of VND2 trillion (US$88 million) for its capital gains tax obligations after its former French owner Casino Group sold its stake to Central for 1 billion euros (US$1.14 billion).

In 2015, authorities also collected VND1.9 trillion (US$85.6 million) in tax arrears from the US$700-million acquisition of Metro Vietnam.

German-retailer Metro Cash & Carry, before being sold to Thailand’s TCC International Land, was accused of falsely reporting losses for 12 years in Vietnam and failing to pay tax bills worth US$23 million, according to the General Department of Taxation.

Policy changes needed to boost rice sector’s growth

Despite rapid growth for years, the rice sector of Vietnam is hamstrung by policies that reduce its competitiveness. Amidst this situation, strong actions are needed to broaden markets and increase rice exports.

Analysing global market forecasts, Sergio Araujo from the Trade and Market Division of the UN Food and Agriculture Organisation (FAO) noted that global rice production mostly depended on higher productivity in Asia and Africa, which produced nearly 500 million tonnes in the 2015-2016 crops

Calculations showed that the world needs more than 50 million tonnes of additional rice. It is forecast that inventories in the future will be lower than production and demand, he said at a conference in Hanoi on May 24.

He said that global rice trade will recover in 2025, but instability in policies and currency is likely to continue, adding that all predictions pointed to a slight fall in global rice inventory and declining rice prices. Currently, large rice producers face the problems of salinity and climate change.

Experts also asserted that in Vietnam, small-scale production has led using many rice varieties leads to differences in quality and difficulties in tracking origin.

Mechanisation levels in harvesting remain low, reducing rice export quality and raising post-harvest losses and production costs, they said, adding that current unsuitable processing procedures also affect quality.

Commenting on the prospects for Vietnam’s rice sector in 2017, Pham Thi Kim Dung from the Institute of Policies and Strategy for Agriculture and Rural Development said the average rice price in 2017 may drop 2.7 percent over 2016 before increasing 6 percent in 2018.

Dung said that Vietnam’s rice sector should focus on systemising, especially in trade intermediate and processing processes. Besides boosting exports, should also pay more attention to domestic market.

Along with keeping a close eye on the Chinese market, it is necessary to maintain traditional markets and develop new ones, she added.

Experts at the event also agreed that in the future, the local rice sector will encounter great challenges, requiring it to continue overcoming its weaknesses and design measures to respond to changes in the world rice market, while raising export revenue with high quality rice varieties and promoting trademark building.

Local consumer trends changing significantly

A forum on “Vietnam’s consumer trend in 2017” was held in Hanoi on May 25 to discuss changes in consumption habits and how to promote the sustainable development of consumer goods in Vietnam.

As the nation with the third largest population in Southeast Asia, about 70 per cent of whom are at working age, Vietnam has potential for consumer goods with significantly rising purchasing power.

The forum was an opportunity for businesses in consumer goods, managers, economic researchers to exchange information. Participants also evaluated opportunities for Vietnamese consumer markets and discussed promoting consumption and market development, said Nguyen Van Nam, director of the Institute for Brand and Competitiveness Strategy (BCSI).

The event covered various themes such as changes in consumer trends in Vietnam, internet shopping, brand positioning, consumers’ confidence in local goods and quality and cost of clean products.

Chaitanya Kishore Reddy, research director of P&S – Mekong at the TNS Global market research company, said that consumption was changing in Vietnam due to improving living standards and lifestyle changes.

Consumers want changes in packaging, as they want to see eye-catching products when they shop, he said.

Consumers tend to prefer foreign brands to domestic ones, which has harmed local firms. Some 64 per cent of rice sold in Vietnam has a foreign name instead of a Vietnamese language name tag, with some Vietnamese firms using foreign languages to boost sales, reported Tran Nhat Tan, deputy head of Vibiz’s research department.

Consumers also tend to focus on safe food and beverages which are good for health and “green” products that protect the environment.

The seminar also discussed the effects of the fourth industrial revolution on consumption. By applying digital technology into consumption habits, people can save time by shopping online.

Global market research firms predicted that in 2017-25, the number of online consumers in Vietnam would surge, with a diverse range of buyers and sellers.

Therefore, enterprises should engage in high technology to introduce products to many online consumers in the era of technology development.

The event was organised by BCSI in accordance with the Vietnam Economic Times (Thời báo Kinh tế Vietnam) newspaper.

Saigon Autotech 2017 opens with added tweak

Saigon International Autotech and Accessories 2017 continues to promote the development of Vietnam’s automobile and supporting industries to international partners.

Running since 2006, Saigon Autotech and Accessories (Saigon Autotech) is the largest specialised exhibition of auto parts and accessories in Vietnam. The expo returns for its 13th edition from May 25 to 28 at Saigon Exhibition and Convention Centre in Ho Chi Minh City.

The four-day event is expected to welcome more than 300 enterprises with 500 booths on display and 120,000 visitors. 

The expo promises great opportunities for information exchange, marketing, sales, and training for the automobile, motorbike, and auto parts industries. This year’s edition has attracted many major brands, such as Veam Corp, Chang An, Dai Phat Tin as well as supporting industry giants like JaanE, Vina AHA, Yabanchain, and Okatsune.

Saigon Autotech 2017 showcases cars, motorbikes, electric and sport bicycles, auto parts, new technology engines and vehicles on 15,000 square metres. 

Other display fields include lubricants, rubber, banks, and smart parking with the aim of enhancing the diversification of products.

With the slogan “Cooperating and sharing solutions for the development of the automobile, motorbike and supporting industries in Vietnam,” Saigon Autotech 2017 organizes several business matching activities to enhance co-operation between domestic and foreign enterprises.

As a special treat within the framework of the exhibition, the Organisation Board of Saigon Autotech has been cooperating with Otosaigon.com Forum to organise the second Emma Vietnam Car Audio Contest on May 27.

Ajinomoto Vietnam opens new office in Hanoi

On May 25, Ajinomoto Vietnam officially opened its new office at the Artemis building at 3 Le Trong Tan street in Thanh Xuan district, Hanoi.

The office has an area of 1,020 square metres. It will be the base of operations where the company will research the Vietnamese food culture and initiate marketing activities to inspire Vietnamese families and people to love cooking as well as connect to young consumers.

One of the features of the office is the Ajinomoto cooking studio where people can sign up to join free cooking classes from June 1. Teachers will be food experts who will share diverse recipes with participants, including every-day and specific dishes for specific eating groups, such as young children, or special holiday dishes. They will also hold classes on nutrition.

Class participants will receive step-by-step instructions and practice at the different stoves available in the room. The dishes will be always updated and new dishes will be added to meet the current trends among young people.

There will be a space for the company to research the Vietnamese food culture and develop products to serve Vietnamese consumers. It is also where the company will develop balanced and nutritious menus to use in the school lunch programme that it has been carrying out in cooperation with the Ministry of Education and Training and the National Institute of Nutrition under the Ministry of Health.

Another highlight of the new office is the infoseum where visitors can learn about the company’s history, its production activities, its efforts to protect the environment, and its corporate social responsibility activities, and more.

“Ajinomoto Vietnam’s mission is to contribute to the further growth of Vietnam and the happiness and good health of its people through food culture and food resources development,” said Hiroharu Motohashi, general director of Ajinomoto Vietnam. “The establishment of the Hanoi office with these unique functional areas is a basis for the company to continue realising this mission.”

Seminar on doing business in the Middle East

As part of its continuing effort to promote commercial trade and investment with foreign economies, the Vietnam Ministry of Industry and Trade sponsored a seminar on May 25 on doing business in the Middle East.

At the seminar, attendees heard from governmental and business community leaders who have recently returned from the Middle East or who are currently engaged in trade with the region.

The seminar was interactive allowing lots of opportunity for these speakers to share experiences.

Currently, exports from Vietnam to the region are far below expectations and their full potential, said the speakers.

The primary reason for this is that trade with the Middle East is beset with a myriad of problems not the least of which are cultural and religious differences and security issues. There are also special problems with transferring money to and from Vietnam to the Middle East, which complicate trade.

The doing business in the Middle East seminar offered attendees some real commercial insights as well as some practical considerations for day to day operations and complying with local Middle East tax and regulatory laws and regulations.

Can Tho develops high-quality large-scale fields

Departments, agencies and sectors of the Mekong Delta city of Ca Tho have been urged to focus on the implementation of measures to enhance the quality of large-scale fields.

At a meeting to carry out the city’s large-scale field development plan to 2020 and orientation through 2025 on May 25, Vice Chairman of the municipal People’s Committee Dao Anh Dung said there are 30 enterprises involving in implementing the large-scale field model in Can Tho, yet difficulties remain in the performance.

According to the official, the city should put only 30,000 hectares of rice cultivation under the large-scale field model by 2020 to ensure the quality and sustainability. The figure will be expanded to 40,000 hectares by 2025.

The agricultural sector needs to pilot other crops and short-term industrial crops on between 15 and 20 large-scale field models.

According to the agricultural sector, five localities will join the plan on developing 40,000 ha of rice cultivation under the large-scale field model, namely Co Do, Phong Dien, Thoi Lai, Vinh Thanh and Thot Not districts with the involvement of over 30,700 households. 

Vinh Thanh will zone off 16,000 hectares for the model, the largest area among the five districts, followed by Thoi Lai with 13,000 hectares and Co Do with 8,000 hectares.

Communication and training work and financial assistance will be provided for those who join large-scale field development while cooperatives will be developed for the model.

By 2025, Can Tho will develop safe agricultural production areas while forming high-quality rice production cooperatives, and improving the capability of cooperatives’ management boards. The city also focuses on the connection among enterprises and farmers and the application of advanced technology.

In 2016, Can Tho put 18,300 hectares of rice cultivation under the large-scale model, up from 400 hectares in 2011.

Advanced technology was applied in the production, reducing cost, increasing productivity, quality and profits while protecting the environment.

Chemical firm to issue bonds and shares for MA

Duc Giang-Lao Cai Chemicals JSC plans to issue convertible bonds and shares worth 833.8 billion VND (37 million USD) in 2017 to merge with Lao Cai Chemical Fertilisers JSC and Bao Thang Chemicals.

The deal is expected to help Duc Giang Chemicals and Detergent Powder JSC, the parent company of the three chemical firms, move closer to the acquisition of the three firms.

This year, Duc Giang-Lao Cai Chemicals will offer three million convertible bonds to current shareholders of the three companies. The bonds have a par value of 100,000 VND, an annual yield rate of 2 percent  and a maturity rate of two years.

Shareholders will be able to convert those bonds into shares of Duc Giang-Lao Cai Chemicals at a ratio of 1:10 (each bond is equal to 10 shares) when the bonds come to maturity.

On the maturity date, bond interest will be paid in cash and the deposit will be transformed into shares for shareholders.

If the conversion takes place after Duc Giang-Lao Cai is merged with Duc Giang Chemicals and Detergent Powder, the original bonds will be transformed into shares of the later firm at the converting rate between the two companies.

Total money raised from bond issuance will be used as a part of investment in a 2 trillion VND, 100M thermal power plant project.

In addition, Duc Giang-Lao Cai Chemicals will offer 53.3 million shares, worth 533.8 billion VND, to convert shares of Lao Cai Chemical Fertilisers and Bao Thang Chemicals into its shares.

Up to 68.3 percent of the shares will be issued for shareholders of Lao Cai Chemical Fertilisers to convert their shares into Duc Giang-Lao Cai Chemicals at a rate of 1:1, and the rest will be issued for shareholders to Bao Thang Chemicals at a conversion rate of 1:0.8.

After the bond and share issuance, new Duc Giang-Lao Cai Chemicals will be merged with Duc Giang Chemicals and Detergent Powder in the form of share conversion.

The M&A deal was approved by shareholders of Duc Giang Chemicals and Detergent Powder JSC at its annual shareholder meeting in April. The deal is expected to double the company’s chartered capital to 1 trillion VND.

Vietnam Airlines, FPT sign cooperation agreement

National flag carrier Vietnam Airlines and FPT Corporation signed a three-year strategic cooperation agreement in Hanoi on May 25.

Under the deal, which is effective from this year until 2020, the carrier having four-star international service standard will supply its transport service for passengers, luggage and goods, and other trade services, as required by FPT. The firm will give preferential trade status to FPT as one of its big customers.

Meanwhile, FPT will provide Vietnam Airlines with its best technological solutions, products and services following the carrier’s requirements, such as mobile devices, website development, e-commerce, cloud computing, security, big data, hosting/data centre, internet service and the appliance for enterprise resource planning.

The two sides will cooperate in research and investment in the development of products and services on the basis of shared investment capital, revenue, expenditure and copyright.

In 2013, Vietnam Airlines and FPT inked a bilateral cooperation agreement on supplying their best services to each other in three years. They have gained good results from this agreement.

Vietreal Expo 2017: Opportunity to study property investment

Some 200 exhibitors will showcase products at the Việt Nam Association of Realtors’ eighth real estate expo, which takes place from June 2 to June 4 in Hà Nội.

The annual event, organised under the sponsor of the Ministry of Construction and the Việt Nam Real Estate Association, specialises in urban and resort housing projects.

VIETREAL EXPO 2017 provides great opportunities for firms to promote brand building and investment, showcase their products and services and establish networks, Nguyễn Văn Đính, general secretary of the Việt Nam Association of Realtors, said at a press conference on Thursday.

The expo will draw the participation of many property developers, real estate services firms and trading floors, such as Gleximco, Taseco, Eurowindow Holdings and Hải Phát, as well as Alphanam, Hòa Bình, Hải Đăng and Phúc Hà, along with Handico, Viglacera, Mbland, Thanh Bình, Udic and Ciputra.

Nothern Green Land and Cen group, as well as Maxland, Phú Quý, Tài Tâm and DTJ, along with EZ,Wellham, Cát Điền, Gia Địa and Realhome, will also participate.

Latest property projects in the country, urban development achievements, industrial parks and residential areas, as well as serviced condominiums, hotels, resorts, office buildings and shopping malls, will be on display at the expo.

Visitors will have the opportunity to study real estate projects and investment opportunities, participate in sales openings and receive attractive promotions from trading floors and developers.

The expo is expected to attract a record crowd.

Đính said the expo would also discuss opportunities in the real estate industry - not only in Việt Nam but in the Asia Pacific region - along with investment challenges and the latest market trends and government policies affecting the market.

According to Nguyễn Chí Thanh, deputy president of the association, the expo is aimed at promoting a transparent real estate market. It will help clarify the legality of projects on display to ensure rights for buyers.

Vietnamese banks, dairy giant named among world’s largest listed firms

Three of the biggest banks in Vietnam and dairy giant Vinamilk have made it onto the latest Forbes list of the world's 2,000 largest public companies.

The annual Global 2000, which ranks businesses based on their revenue, profits, assets and market value, named BIDV, VietinBank, Vietcombank and first-timer Vinamilk among its high-flyers.

All three banks improved their positions from last year.

VietinBank jumped 175 spots to 1,633rd with revenue of US$2.7 billion and market value of US$3 billion. Vietcombank came in at 1,656th with US$2.1 billion in revenue and US$5.8 billion in market value, while BIDV finished at 1,682nd with US$3.3 billion in revenue and US$2.6 billion in market value.

Vinamilk, with estimated revenue of US$2.1 billion and market value of US$9.1 billion, ranked 1,888th.

The companies that made it onto the 2017 list are from 58 countries and together account for $35.3 trillion in revenue, US$2.5 trillion in profit, US$169.1 trillion in assets, and a combined market value of US$48.8 trillion. All four metrics are up from the previous year.

U.S. companies dominated the list with 565, followed by China and Hong Kong with 263.

Chinese and U.S. firms also accounted for most of the top 10.

Prévoir Vietnam & NCB launch new life insurance product

The Prévoir Vietnam Life Insurance Co. and the National Citizen Bank (NCB) launched “Khang An Bao Gia” on May 20, the first endowment life insurance product line to be exclusively provided through NCB’s network.

Khang An Bao Gia was designed by Prévoir Vietnam for NCB’s clients so as to meet diverse needs, such as savings and protection of financial health against unexpected risks in life, ensuring financial protection for clients and their families.

It brings about financial accumulations for clients’ future plans following Prévoir Vietnam’s slogan: “A better tomorrow starts today”.

Deputy CEO of NCB, Mr. Ta Ngoc Da, speaks at the launch of Khang An Bao Gia. Photo: Prévoir Vietnam

In talking about the selection of partners, Deputy CEO of NCB Ta Ngoc Da said: “NCB expects to have a professional insurer specializing in providing insurance products to the bank’s customers and one that fully understands the needs of our clients. We selected Prévoir Vietnam as our strategic partner to deliver the most comprehensive and practical financial solutions to our customers.”

For his part, CEO of Prévoir Vietnam Khamsaya Soukhavong affirmed that the new endowment life insurance product being introduced to the Vietnamese market via NCB demonstrates the strong and long-term commitment by Prévoir Vietnam to cooperate with NCB in conducting studies and responding to clients’ needs, especially those who have already trusted NCB’s products and financial services.

“We would like to ensure that all NCB’s clients will be protected and can avoid all unpredictable risks in their life,” he added. “We are always next to our clients to give them the best support.”

Prévoir Vietnam is a member of Prévoir Vie, which is a long-standing group in finance and life insurance and enriched by a history of over 100 years in France. It is a leading life, healthcare, and retirement company and in particular a professional insurance company providing solutions and bancasurance for clients.

Together with an exclusive distribution agreement with NCB, Prévoir Vietnam has partnerships with 13 leading commercial banks in Vietnam in bancassurance and serves more than 350,000 existing customers. It offers a digital strategy and holistic approach to financial solutions. Based on the company’s current strengths in digitalization, Prévoir Vietnam brings international standard tools to its partnerships.

Founded in 1995, NCB has gradually positioned itself in Vietnam’s financial and monetary markets with increasing trust from clients, partners and investors. Its business areas include fund mobilization, fund receipt, trust services, loan services, discounted bills, joint venture investment, and payment services.

It will deploy a product strategy this year that focuses on the segments of housing, car, digital banking and bancassurance. The strategy is based on the completion of its business model, the enhancement of risk management capacity, and the expansion of partners and clients. To realize its target of increasing its charter capital by VND3 trillion ($132 million), NCB plans to select a foreign strategic shareholder from among its partners.

Experts discuss draft Law on Tourism

The Vietnam Economic Times Group held the “Creating a Breakthrough for Tourism to Develop into a Spearhead Economic Sector” workshop in Hanoi on May 25.

A range of ideas were floated by economic experts and business leaders about the draft Law on Tourism 2017.

Mr. Nguyen Quoc Ky, Chairman and General Director of Vietravel, said the draft law is no different from the Law on Tourism 2005. “Vietnam has targeted tourism turnover of $35 billion and international visitors to increase 190 per cent, but the changes in the draft law do not match these goals,” he said. “A tourism law must be built based on support, to create impetus in terms of mechanism and development.”

Many comments at the workshop involved the establishment of tourism promotion agencies being separated from the role of the Ministry of Foreign Affairs (MoFA).

Mr. Luu Duc Ke, Director of Hanoitourist, spoke of the tourist inspection issue, saying that if tourism is considered a key sector, it must have its own inspection force.

Speakers including economic expert Le Dang Doanh, entrepreneur Mr. Ky, and the Chairman of the Vietnam Tourism Association and member of the National Assembly Duong Trung Quoc, believe the National Assembly will not pass the draft law.

Similarly, Ms. Huong Tran Kieu Dung, Deputy Chairwoman of the Board of Management of the FLC Group, agreed that there were many barriers to tourism becoming a key economic sector, such as planning and regulations for tourism development remaining complex. “The government should have more laws to encourage businesses to invest in real estate, resorts, transport infrastructure, and aviation for tourism development,” she proposed.

The number of international visitors in the first fourth months of this year was estimated at over 4.2 million, up 30.3 per cent year-on-year, according to the General Statistics Office (GSO).

Hoping to give the tourism industry a major push, the Vietnamese Government has launched a much-touted online visa system for travelers on short holidays or business visits.

Tourism authorities are eyeing a 15 per cent increase in international visitors this year. The sector is expected to contribute 10 per cent to Vietnam’s GDP and become a key economic driver by 2020. By that time, the country is expected to welcome up to 20 million foreign visitors and earn $35 billion in tourism revenue.

International Retail & Franchise Show 2017 set to open

Following its success in previous years, the Vietnam International Retail & Franchise Show (VIETRF) in June will again be co-organized by the Korea International Trade Association (Kita), Coex Vietnam, the Association of Vietnam Retailers (AVR), and the Vietnam National Trade Fair and Advertising Company (Vinexad).

The exhibition will be held from June 1 to 3 at the Saigon Exhibition and Convention Center (SECC) in Ho Chi Minh City’s District 7 and include exhibitions, an introduction to new products and services, a biz-matching program, seminars, and the final round of the Go Global Startup Competition 2017.

All the needs of shopkeepers and owners of supermarkets, convenience stores, coffee shops, restaurants, fashion boutiques, and cosmetics stores will be met at the show. Exhibited items include construction and design, interior décor items, automatic cash registers, security gate systems, and advanced technology for stores and distribution.

Distributors of retail goods, store equipment, and technology will be in attendance. Advanced technology and equipment from foreign brands will be introduced, with distributors finding new, high-quality retail items that can be distributed in Vietnam. With over 500 booths, VIETRF 2017 will welcome more than 300 domestic and foreign enterprises from 14 countries and about 40,000 buyers from Vietnam and neighboring countries.

It will also have international franchise booths from South Korea, Malaysia, Taiwan, and Singapore, and booths from the World Franchise Association. These exhibitors are seeking business partners looking to purchase Master Franchises in the following fields: Food & Beverages, Health & Beauty, Fashion, Education & Training, Retail & Wholesale, and Services.

At the same time, the Coffee Expo Vietnam 2017 - Coffee, Tea, Bakery & Desserts, will also be held at SECC. It showcases premium coffee and tea, ingredients, machinery and facilities, desserts, and other related products from well-known domestic and international brands.

The fondness for drinking coffee among Vietnamese is clearly shown by the large number of coffee shops around residential areas, workplaces, and shopping centers, which have strongly developing the Vietnamese coffee industry. Beside coffee, new types of beverages such as tea and milk tea have appeared in Vietnam. Popular milk tea brands and “English afternoon tea” shops are popular among young people.

The boom of new urban developments as well as satellite cities has led to major growth in the number of coffee and pastry chains. According to a report from market researcher Euromonitor, the number of coffee shop chains in Vietnam is growing about 7 per cent each year. In 2015, it was estimated that there are more than 26,000 chain stores in Vietnam. The coffee shop chain market has a lot of potential for sustainable development, and each brand has to choose its own strengths while ensuring uniformity of products and services.

A variety of products and services can be found at the exhibition, including tea, coffee, machinery, equipment, products, and materials to make beverages and sweet foods. Many well-known brands will attend the exhibition and their presence will present opportunities for domestic and foreign enterprises to find suitable partners to develop and invest in their business.

Vinamilk imports 2,000 heads of US dairy cattle

The Vietnam Dairy Products Joint Stock Company (Vinamilk) has imported more than 2,000 cows from the US.

The cows were sent to Vinamilk’s Tay Ninh cow farm, bringing the total number of cows at the farm to nearly 5,000. Following the import, the Tay Ninh cow farm has become Vinamilk’s largest cow farm, covering 700ha and using high technology to raise cows.

All of the imported heads are high-yield Holstein Friesian cows, producing 14,000 liters of milk in 305 days. They were carefully selected and underwent strict quarantine and health checks before arriving in Vietnam.

The Tay Ninh farm will welcome more imported cattle this year and increase its herd to 8,000 heads.

The total number of cows supplying milk to the company, including from Vinamilk’s own farms and from farmers it has signed contracts with, is more than 120,000, supplying about 750 tons of fresh milk each day.

The company plans to increase its herd to 160,000 this year and 200,000 by 2020. Its daily fresh milk output is targeted to reach 1,500-1,800 tonnes over the next three years.

Vietnam’s leading dairy producer signed a memorandum of cooperation with a Chinese partner on May 12 to export dairy products to Vietnam’s northern neighbor. The signing was witnessed by senior Chinese leaders and visiting State President Tran Dai Quang, who was in China from May 11 to 15 on a State visit.

China is a huge market, with a total dairy value of about $30 billion a year. Vinamilk hopes that the memorandum will be an opportunity to export dairy products in the near future, when a trade agreement between the two countries is signed.

Vinamilk is the largest dairy firm in Vietnam, with a market share of more than 50 per cent, and is among the world’s Top 50 milk producers by revenue.

It earned export revenue of $258 million in 2016, exporting to 43 countries and territories worldwide, including the US, Japan, Thailand, and the Philippines.

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