As Vietnam’s stock market struggles with low liquidity and declining appeal, a wave of stock purchases by executives' families and related parties is sparking curiosity. What’s happening in Vietnam’s capital market?

Recent disclosures show a trend of major purchases by family members of corporate leaders:

·        Masan Group (MSN): Nguyen Yen Linh, daughter of billionaire Nguyen Dang Quang (Masan’s chairman), spent approximately 600 billion VND to acquire 8.5 million shares out of a planned 10 million between October 29 and November 18. This purchase increased her stake to 0.59%. The move comes as MSN stock dropped from over 81,000 VND to below 70,000 VND in recent months, far from its late-2021 peak of 140,000 VND per share.

·        911 Group (NO1): Nguyen Thi Hai, wife of chairman Luu Dinh Tuan, bought 763,500 shares between October 15 and November 13, raising her stake to 7.28%.

·        TNG Investment and Trading JSC (TNG): CEO Nguyen Duc Manh registered to purchase 1 million shares in December, potentially raising his holdings to 8.01%.

·        HIPT Group JSC (HIG): Chairman Le Hai Doan registered to buy 1 million shares, potentially increasing his ownership to 47%.

·        Lam Son Sugar JSC (LSS): Chairman Le Van Tan registered to buy 500,000 shares, following Vice Chairman Le Trung Thanh’s purchase of 2.65 million shares in October.

·        Vinhomes (VHM): The firm repurchased nearly 247 million shares worth 10.7 trillion VND, marking 66.75% of its initial repurchase target.

·        Vietnam International Bank (VIB): Dang Thi Thu Ha, wife of vice chairman Dang Van Son, registered to buy 10 million shares, while their daughter Dang Minh Ngoc plans to acquire 4 million shares.

·        HDBank (HDB): CEO Pham Quoc Thanh registered to purchase 1 million shares, potentially raising his stake to 0.199%.

This surge in purchases coincides with a sluggish stock market characterized by low liquidity and a persistent downtrend. Experts suggest several possible motives:

1.     Company-Specific Developments:

NO1 Group: Expansion plans, such as purchasing VinFast vehicles for a taxi fleet.
Masan Group: Resurgence in retail and consumer sectors and potential deals with foreign investors like South Korea’s SK Group.
VIB: Possible divestment by Commonwealth Bank of Australia.
Vinhomes: Repurchases possibly due to undervalued stock prices or foreign investor sell-offs.
2.     Long-Term Confidence:
Executives and their families often buy during downturns, signaling confidence in their companies’ future prospects.

3.     Market Opportunities:

Low prices and weak sentiment may present attractive buying opportunities for long-term investors.

The stock market’s recent struggles stem from:

Foreign Outflows: Net outflows of 85 trillion VND since the beginning of the year, driven by a strong USD/VND exchange rate and higher global interest rates.
Domestic Constraints: Record-high margin lending of 9.2 billion USD contrasts with low trading volumes of 10–15 trillion VND daily.
Debt Pressures: Many firms are focused on managing bond repayments due by the end of 2024.

Despite these challenges, some experts believe the current downturn and liquidity crunch may mark the market’s bottom. While immediate recovery is unlikely, this phase could offer buying opportunities for long-term investors, particularly in companies with robust strategies and growth potential.

Manh Ha