Remove bottlenecks, unlock capital flows.
Given the unpredictable fluctuations that the stock market has experienced from 2020 to the present, the Talkshow "Unlocking Capital Flows in the Stock Market" aims to address the difficulties faced by listed companies, stimulate effective capital flows in the stock market in the new context, and enable the investment community to seek investment opportunities, viewing the stock market as a place to generate profits and increase assets.
Accordingly, regarding the current situation of newly listed companies (IPOs) on the market, Ms. Ta Thanh Binh, Director of the Securities Market Development Department, said that from the beginning of the year until now, the State Securities Commission (SSC) has only received 5 IPO applications, while applications for public offerings and registrations for public offerings are still being supplemented, but all have decreased by about 45% compared to the same period in 2022, and new issuances are only 40% compared to the previous year.
Ms. Binh emphasized that, in order for businesses to quickly raise capital in the market, reduce procedures, and avoid missing out on public offerings, listed companies need long-term plans and strategies, detailed and appropriate capital utilization plans, and sufficient transparency and clarity to avoid wasting time on assessments by regulatory agencies and missing out on opportunities for the businesses.
Further emphasizing the importance of the securities fundraising channel, Mr. Nguyen Vu Long, Chairman of VNDirect Securities Company, stated that securities are an excellent issuance channel for businesses; however, recent irregularities have disrupted this capital raising channel. Therefore, what is needed at this time is to rebuild the securities channel to support businesses in finding sources of capital, while simultaneously building the capacity to raise capital in the stock market.
Overview of the Talkshow.
Furthermore, the sustainability of the market depends heavily on regulatory bodies; the State Securities Commission and the Government need to implement strict and transparent policies to stabilize the market and create a stock market that attracts both domestic and foreign investors.
Regarding foreign capital flows, Mr. Dang Thanh Tam, Chairman of Kinh Bac Urban Development Corporation (KBC), noted that capital flows from financial institutions are more sustainable and offer better quality goods. However, private capital from both domestic and foreign sources accounts for the majority, and if policies become more favorable and automated, this capital flow could grow stronger.
Besides macroeconomic policies, the most important factor in the market remains confidence. Towards the end of 2022, market confidence declined both domestically and internationally.
"For my company, when securities firms suddenly cut margin trading, and there's a short time to rectify the situation, this inadvertently leads to short selling of shares on the market," said Mr. Dang Thanh Tam.
Therefore, Mr. Tam hopes that the regulatory authorities will have specific policies, mechanisms, and regulations, specifying when additional capital can be injected or loans can be granted to businesses to help them adapt in a timely manner, or that the State Bank of Vietnam can provide support to securities companies to supplement resources to support businesses as soon as possible.
Building investor confidence
Currently, the number of new accounts opened has been continuously increasing in recent months, and liquidity is trending upwards, indicating that investors are still holding on and have not yet left the market.
Mr. Vu Duc Tien, General Director of Saigon - Hanoi Securities Company (SHS), suggested to investors that when they see safer and more positive signals, they should disburse funds in May and June, when the Government has issued economic stimulus packages and fiscal solutions to support businesses.
Similarly, Mr. Nguyen Vu Long, Chairman of VNDirect Securities Company, also noted that investors' confidence in the market is not simply based on macroeconomic policies, but also on the performance of the businesses themselves.
Mr. Nguyen Vu Long, Chairman of VNDirect Securities Company.
Furthermore, he suggested that the policies issued by regulatory agencies should be consistent, have a clear message, and be consistent across all levels, from the Government to ministries and departments, so that foreign investors can rely on them to choose investment options.
As for domestic investors, Mr. Long believes that investors always need to observe variables they cannot control, for example, the fact that the Vietnamese economy cannot experience excessive growth when the global economy is still struggling, inflation in the US remains too high, and political conflicts are escalating.
Therefore, investors need to observe carefully to choose the appropriate investment position. In addition, they need to understand how to use financial leverage tools and be aware of the risks associated with using them.
This is a market recovery phase, and investors are starting to have more confidence, but macroeconomic variables remain too complex, so investors should exercise just enough caution. To reduce short-term market risks, investors need a longer-term perspective and a change in investment approach to achieve higher returns, Mr. Long said .
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