Conducting an initial public offering (IPO) to list on a foreign stock exchange not only helps Vietnamese companies attract investors but also strengthens their status and the country’s profile in the world.
According to the State Securities Commission of Vietnam (SSC), successful IPOs on foreign bourses help listing companies attract more investment from international organisations and institutions, improve their management quality and competitiveness, promote their image in international markets, and grow their markets.
When a company files for an IPO on a foreign stock exchange, it can raise substantial amounts of capital, build confidence among foreign investors, enhance its position and image, and broaden its market access.
Experts have said that leading domestic businesses listing abroad has become a clear trend and follows the strong growth of Vietnam’s economy over the years.
Nguyen Thanh Ha, President of the SBLaw company, said amendments to the legal framework regarding securities have created favourable conditions for Vietnamese firms to list abroad.
One prerequisite for an international listing is staying under the foreign ownership ratio. Listing companies must also comply with the law on foreign exchange management.
However, experts said that issuers still face difficulties in raising capital due to differences in accounting standards between Vietnam and foreign countries.
For companies listed in foreign markets, the risk of being acquired or merged is rising and the cost of complying with regulations on listing, reporting, and disclosing information and corporate management is higher.
The SSC said it will encourage companies to conduct IPOs and list on foreign markets as long as they abide by State laws and policies.
Vietnam’s stock market is expected to continue to grow, helped by strong economic growth and increasing local liquidity. The positive outlook will attract foreign investors back to the market, according to HSBC.