VietNamNet Bridge – A lot of businesses have been forced to delist because they did not expose information. Big shareholders keep complaining about the listed companies’ lack of transparency, while small shareholders say they have to seek information from unofficial sources.

The wave of delisting

The Hanoi Stock Exchange has informed that three companies will be forced to delist in September, namely CIC, an investment and construction company, Trang An Securities TAS and HBP, a packaging company.

As for the HCM City bourse, PXM, a construction and installation enterprise is likely to be forced to delist as its progressive loss by June 30, 2013, had reached VND249 billion, which is even higher than its chartered capital of VND150 billion.

In cases of CIC and TAS, they have to delist because of the serious violations of the regulations on information exposition. Only HBP decided to delist on the voluntary basis as per the shareholder’s meeting decision. The enterprise still makes profit, while its share price hovers around VND10,300 per share.

As such, 27 enterprises and 3 investment funds (which have shifted into open end funds, or terminated their operation duration) have delisted so far this year on both the Hanoi and HCM City bourses.

It is obvious that the number of businesses to be delisted this year would be much higher than that in 2012 (18). Other businesses are still awaiting the death, and the decisions to force them to delist would be released in some days.

While the number of delisted companies is on the rise, the number of enterprises entering the bourses remains modest. A report by the State Securities Council showed the increase of 7 newly listed companies in the first half of the year.

Delisting means disappearing?

STT, a transport firm, has informed about the cancelation of the report on delisting its shares at the HCM City Stock Exchange.

At the August annual shareholders’ meeting, the delisting decision was approved by 4.65 million shares, or 76.77 percent, including the big shareholder Saigontourist and Vinh Da Steel Company. 1,406 million did not approve the delisting, or 23.23 percent.

Hong Dung, a shareholder of STT, said she now can sigh with relief as she has sold all the STT shares she held, despite the 50 percent loss.

Dung began selling STT after hearing some bad news about the company, though she was sure about the loss.

Chi, an investor at the Rong Viet Securities Company, also said he has successfully withdrawn capital from STT, though he had to struggle hard to do that.

According to Chi, the amount of STT shares traded every day is very small, just tens of shares. Meanwhile, investors have become hesitant to buy STT shares on the news about the problems of the company.

Chi went on to say that the companies’ delisting usually make shareholders suffer, because it is very difficult for them to withdraw capital from “problematic enterprises”.

In many cases, shareholders cannot sell shares, even though they know the companies’ delisting would come, sooner or later.

The State Securities Commission has requested the delisted companies to put their shares into transactions on UpCom trading floor to ensure the investors’ benefits. However, not all the delisted companies have followed the regulation.

Tien Phong