Foreign investors look forward to Vietnam’s imminent IPOs in 2020

Nearly 100 Vietnamese companies will need to hit the road for share auctions by the end of 2020 to meet the government’s target of privatizing state firms.

foreign investors look forward to vietnam’s imminent ipos in 2020 hinh 0

MobiFone is expected to make IPO this year.

Many foreign potential investors are waiting for the initial public offering (IPO) of Vietnamese high-profile state-owned enterprises (SOEs) that are named in the country’s list for privatization this year.

Representatives of a Japanese group, which declined to be named, said that they are very interested in the privatization roadmap of two SOEs: Dong Nai Food Industry Corporation (Dofico) and Khanh Viet Corporation (Khatoco).

Dofico, which was set up in 2005, is one of large and effective multi-industry firms of the southern province of Dong Nai. The firm has an average turnover of some VND2 trillion (US$86.95 million) and the Japanese investor expected that its business performance results could take a leap if having financial aids as well as governance expertise and technologies from foreign investors.

With strengths in some business segments that are the same with Dofico, the Japanese investor is interested and expected to buy a large volume of Dofico’s shares.

Similarly, the investor is also paying great attention to Khatoco, which is one of the largest firms in the central region and operates in packaging, paper and cigarette production industries.

According to experts, though not being able to hold the dominant shares of the Vietnamese firms as the State sets to own 51- 65% of the firms’ charter capital, the Japanese investor is still keen on the firms as it wants to take advantages of the firms to deeply penetrate  the domestic market, which has high potentials with a population of 100 million and a good geographic position in Southeast Asia.

To enter the Vietnamese market, many foreign investors are considering investing in local fruitful SOEs that have been approved for privatization.

Attractive list

Nearly 100 Vietnamese companies will need to hit the road for share auctions by the end of 2020 to meet the government’s target of privatizing state firms.

In the list of nearly 100 firms to be privatized this year, there were many notable names for investors, such as Agribank, MobiFone, VNPT, SJC Jewelry, Ha Dong Clean Water, Thong Nhat Hanoi Park, Ben Thanh Saigon Corporation and Hanoi Tourism Corporation.

 

Vu Huu Dien, fund manager at Dragon Capital, hoped for a reasonable outcome from the privatization pipeline, due to many high-profile names in the list.

Max Loh, EY’s ASEAN IPO leader, said that going public is still very much the trend for Vietnamese companies. The stock market capitalization presently accounts for almost 80% of the country’s GDP and forecast to grow to 100% of GDP by 2020.

However, to boost up the privatization, experts suggested the government to streamline current legal regulations, especially those in valuating state assets including land funds.

Phan Van Ha, general director of the Vietnam Valuation IVC JSC, said conflicting and overlapping legal documents on land use rights certificates are the cause of delayed privatization plans.

SOEs need to acquire provincial confirmation of their land use before finalizing privatization plans. However, the process may take months and often exceeds the regulated time period for SOE privatization, so both SOEs and appraisers must re-do the reports.

In some cases, land use right certificates are not counted into the firms’ valuations, making it more difficult for competent agencies to evaluate the firms.

To avoid a similar case in the future, whether to include a firm’s land use right in the valuation report or not must be legalized, Ha said.

According to Ngo Tri Long, former director of the Ministry of Finance’s Price and Market Research Institute, land use right is among the decisive factors that make SOEs valuable to investors, especially local ones. If the issues related to land use right aren’t resolved soon, SOEs’ privatization plans will be delayed and it could mean more losses for the state budget. Hanoitimes

Anh Hong

Foreign investors net buy VN shares after 5-month offloads

Foreign investors net buy VN shares after 5-month offloads

Foreign investors bought more Vietnamese stocks than they sold in January, snapping a month-long streak as net buyers after offloading shares in the last five months of 2019.

Many foreign investors circumvent the laws

Many foreign investors circumvent the laws

Experts have warned of the attempt by many foreign invested enterprises (FIEs) to dodge the laws to enjoy preferences and make local authorities ‘lose lock, stock and barrel’.

 
 

Other News

.
BUSINESS NEWS HEADLINES TODAY
BUSINESS NEWS HEADLINES TODAY
BUSINESSicon  15/02/2020 

Coronavirus outbreak hits 322 enterprises

Vietnam’s economy to expand 6.25% if coronavirus outbreak ends in Q1
Vietnam’s economy to expand 6.25% if coronavirus outbreak ends in Q1
BUSINESSicon  15/02/2020 

Vietnam’s GDP growth is expected to reach 6.25% this year if the outbreak of Covid-19 is contained within the first quarter, according to the Ministry of Planning and Investment.

Apparel firms scramble to make mask production amid coronavirus spread
Apparel firms scramble to make mask production amid coronavirus spread
BUSINESSicon  16/02/2020 

Many textile and garment businesses are scrambling to make face masks given the coronavirus outbreak-triggered lack of surgical masks.

Vietnam’s estate companies seek investment opportunities in foreign markets
Vietnam’s estate companies seek investment opportunities in foreign markets
BUSINESSicon  15/02/2020 

More and more domestic real estate firms have begun to seek investment opportunities in global markets, according to Savills Vietnam.

Bad debts may increase amid coronavirus outbreak
Bad debts may increase amid coronavirus outbreak
BUSINESSicon  15/02/2020 

Bankers anticipate that the coronavirus outbreak will affect the business of many of their clients.

Hundreds of enterprises may have to suspend production because of coronavirus
Hundreds of enterprises may have to suspend production because of coronavirus
BUSINESSicon  15/02/2020 

Hundreds of enterprises, both Vietnamese and foreign invested, are increasingly concerned about supply of components from China.

Enterprises stii need more workers after Tet
Enterprises stii need more workers after Tet
BUSINESSicon  16/02/2020 

Enterprises in HCM City, Binh Duong and Dong Nai complain that they have not been able to recruit workers since Tet.

Virus rouses food safety awareness in Vietnam
Virus rouses food safety awareness in Vietnam
BUSINESSicon  15/02/2020 

Supermarkets and retailers in Vietnam are making bank from the public rushing to stock up on indispensable food supplies, which could ultimately push forward an increase in awareness of food handling and safety.

Plastic packagers looking to Vietnam
Plastic packagers looking to Vietnam
BUSINESSicon  14/02/2020 

The unfavourable prospects of the Thai packaging industry, dimmed by the ban on single-use plastic bags in the country, may force packaging manufacturers to shift business to nearby markets like Vietnam.

More than 800 firms stop operating or scale down because of coronavirus
More than 800 firms stop operating or scale down because of coronavirus
BUSINESSicon  15/02/2020 

More than 800 businesses and 8,700 employees have been affected by the novel coronavirus epidemic, according to the Ministry of Labour, Invalids and Social Affairs.

PM Phuc allows border gates to re-open
PM Phuc allows border gates to re-open
BUSINESSicon  14/02/2020 

Prime Minister Nguyen Xuan Phuc approved the resumption of imports, exports and transport of goods through three sub-border gates between Vietnam and China to help local firms.

VN industrial sector’s growth likely to slow down due to COVID-19
VN industrial sector’s growth likely to slow down due to COVID-19
BUSINESSicon  14/02/2020 

Growth of Vietnam’s industrial sector is likely to slow down in the first quarter of 2020 due to negative impacts from the acute respiratory disease caused by a novel coronavirus (COVID-19), according to the General Statistics Office (GSO).

VN to issue lists of preferential tariffs under EVFTA
VN to issue lists of preferential tariffs under EVFTA
BUSINESSicon  14/02/2020 

The Vietnamese Government is set to issue a decree on the lists of preferential export tariffs and special preferential import tariffs to implement the EU-Vietnam Free Trade Agreement (EVFTA) when the deal comes into force in Vietnam.

New driving force for Vietnam-EU relations
New driving force for Vietnam-EU relations
VIDEOicon  14/02/2020 

The European Parliament has ratified the EVFTA and the EVIPA. The ratification has opened up new horizons for more intensive, comprehensive and effective bilateral cooperation 30 years after the establishment of diplomatic ties.

Two scenarios for Vietnam’s economic growth
Two scenarios for Vietnam’s economic growth
BUSINESSicon  15/02/2020 

If the nCoV epidemic lasts a long time, the GDP is expected to decrease.

Money oversupply increases core inflation
Money oversupply increases core inflation
BUSINESSicon  16/02/2020 

Keeping the inflation rate at 4 percent in 2020 will be a challenging task, not only because of the pork price escalation, but also money excess.

BUSINESS NEWS HEADLINES FEB. 14
BUSINESS NEWS HEADLINES FEB. 14
BUSINESSicon  14/02/2020 

Large retail formats to dominate HCM City’s retail market

Vietnam says to ratify EVFTA in May
Vietnam says to ratify EVFTA in May
BUSINESSicon  13/02/2020 

The EVFTA will be ratified in May and take effect in July this year if everything fares well, said Minister of Industry and Trade Tran Tuan Anh.

Japanese firm to attract Vietnamese workers via football
Japanese firm to attract Vietnamese workers via football
BUSINESSicon  14/02/2020 

Japanese electronic device maker Lion Power is tapping into football’s popularity in Vietnam as a way to recruit technical trainees amid a labour shortage in Japan, reported the Asian Nikkei Review.

COVID-19: Mong Cai completes preparations to resume border trade
COVID-19: Mong Cai completes preparations to resume border trade
BUSINESSicon  13/02/2020 

Mong Cai city in Quang Ninh has basically completed preparations to resume trade through the Mong Cai International border gate, after a suspension due to the outbreak of coronavirus (COVID-19).

 
 
 
Leave your comment on an article

OR QUICK LOGIN