VietNamNet Bridge - Questions have been raised about the role of the State Capital Investment Corporation (SCIC) and about what it would do after it sells all valuable assets.

SCIC is now a powerful state-owned company belonging to the Ministry of Finance which specializes in making investments in enterprises with the state’s money. 

An analyst said SCIC has four major assets that it can keep for a long time – Vinamilk, FPT Telecom, the Vietnam Reinsurance Company (Vinare) and the Hau Giang Pharmacy. If it sells three of 10 of the most profitable enterprises, it will have only one left – Hau Giang Pharmacy.  

SICI developed rapidly over the last 10 years since the day of its establishment. Its total assets have soared from VND5.2 trillion in 2006 to VND73 trillion, or 13.8 times higher, while the post-tax profit from VND111 trillion in 2006 to VND6.798 trillion. Meanwhile, the ROE (return on equity) ratio is 15.6 percent on average in 2011-2015. 

The good business performance of big companies like Vinamilk and FPT Telecom made great contributions to SCIC’s strong rise. In 2014, the dividends SCIC received from Vinamilk were VND1.5 trillion, which accounted for 21 percent of its turnover from capital investments. The remaining turnover came from the sale of capital it contributed to hundreds of other enterprises.

Therefore, analysts have questioned what SCIC would live on if it does not have valuable assets.

The analyst believes that if SCIC sells the 10 enterprises, it may earn over $3 billion. A part of the amount of money would be transferred to the state budget to help settle the budget deficit, while the remaining money would be injected into other valuable assets.

SCIC has set up an ambitious plan for its second development stage. From 2015 to 2020, SCIC would focus on huge projects which play important roles in the national economy which it would implement in cooperation with the strong brands Vietcombank and Singaporean Temasek Holdings.

The total asset value SCIC is expected to manage may reach $22.5 billion by 2020, which would list it among the region’s leading finance groups.

Most recently, SCIC has bought $160 million in Military Bank shares, becoming a big shareholder of the bank with 10 percent of stakes. The government is step by step reducing its ownership ratios in the largest banks such as Vietcombank, VietinBank and BIDV, which would bring large investment opportunities to SCIC.

SCIC can also put high expectations on the equitization of large companies, namely Sabeco, the largest Vietnamese brewery, MobiFone, the largest telecom network, and airports, seaports and highways.

To manage increasingly big assets, SCIC will have to restructure its apparatus.

NCDT