VN firms may qualify for S Korea exchange listing

HA NOI — About 22 Vietnamese companies currently listed on domestic stock markets could qualify to list shares on Korean stock exchanges, according to an assessment by South Korean-invested Woori CBV Securities Co published at a conference here on Wednesday about raising capital on Korean markets.

Vietcombank, Vinamilk, real estate developer Hoa Phat Group, software giant FPT and the PetroVietnam Technical Services Co were among those that could list in South Korea, the assessment found. Vietnamese firms could benefit greatly by listing on the Korean market, said Lee Daegyu, the assistant director of listing promotions for the Korean Stock Exchange.

Besides raising capital through initial public offers, the companies could access investment opportunities in South Korea and more effectively market themselves to Korean investors, Lee said.

The Korean Exchange was working to attract more foreign companies to list, Lee added. In 2007-10, 15 foreign firms listing shares on the exchange, with 13 coming from China, one from Japan and one from the US.

The Korean Exchange has two separate markets, the Kospi and Kosdaq stock exchanges.

A foreign firm wishing to list on Kospi needs a total market capitalisation no less than US$16.6 million, while a listing on Kosdaq requires a firm to have capitalisation in excess of $7.5 million.

Since early 2009, the success of Government bond issues overseas has open more doors to local companies to raise capital on overseas markets. HCM City-listed property trader Vincom, for instance, has offered $80 million in convertible bonds overseas.

Convertible bonds could become the most favourable channel for Vietnamese companies to raise capital overseas, affirmed the director of Woori's HCM City branch, Lim Song Hak.

But the head of market development for Viet Nam's State Securities Commission, Nguyen Son, warned that regulations on securities offerings, listings and disclosure on overseas markets still remained difficult for Vietnamese firms.

The commission was drafting an instruction to support local firms seeking to list overseas, Son said.

Textile firm Mirae Joint Stock Co, currently listed in HCM City, is the only firm now actively seeking to comply with listing procedures for the Korea Exchange.

Mirae received permission from the Vietnamese Government in May 2009 to pursue the overseas listing. — VNS

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Firms falter in plans to issue shares

Listed companies on the two national stock exchanges have completed only
48 percent of additional share issues targeted for this year, although
81 percent of planned stock splits have been carried out, according to a
report from Saigon Securities Inc (SSI).

As of August
31, companies had issued over a billion shares, or 81 percent of a 1.28
billion to be issued this year through stock splits, which include
offering bonus shares to existing shareholders and paying dividends in
the form of shares.

"If existing shareholders refuse to
buy additional shares, they face a risk of dilution as share prices will
be adjusted downward in proportion to the value of the issue," SSI
director of analysis Hoang Viet Phuong wrote in a statement.

Listed companies (not including banks) have also targeted to raise
nearly 19.4 trillion VND (993.7 million USD) this year through the issue
of additional shares.They have so far raised over 9.3 trillion VND
(476.9 million USD) on the two national stock exchanges, or 48 percent
of the goal.

Firms have also succeeded in issuing 1.93
trillion VND (99 million USD) worth of convertible bonds, or 25 percent
of the targeted 7.7 trillion VND (395.5 million USD) for the year.

These figures do not include planned initial public offerings (IPOs) on
the over-the-counter market. PetroVietnam Gas, for instance, expects to
raise 150 million USD in its IPO next month.

Seven listed
commercial banks, meanwhile, have projected to raise 17 trillion VND
(871.8 million USD) in the sale of additional shares and 1.5 trillion
VND (76.9 million USD) in the sale of convertible bonds.

The total capital which companies hope to raise this year accounts for
just 4.4 percent of total market capitalisation on the two stock
exchanges and was expected to be absorbed in part by indirect foreign
investment inflows which have already totalled 1.8 billion USD in the
first half this year.

Phuong, however, doubted whether
remaining targets could be met before the end of the year under the
current circumstances on the market.

Stockholders were
also voicing increased concerns over how effectively companies would
utilise amounts raised and the impact of aggressive share issues on
corporate growth and the national economy overall, he said./.

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