The proposal to shorten the listing process from 90 days to 30 days is expected to better protect investor rights and could become an incentive for more companies to list their shares.
The proposal to shorten the listing process from 90 days to 30 days is expected to better protect investor rights and could become an incentive for more companies to list their shares.
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| The "giant" in the resort real estate industry is getting closer to launching its IPO plan. Photo : Duc Thanh |
Newcomers heat up the market.
Last weekend, the Board of Directors of Vinpearl Joint Stock Company (a subsidiary of Vingroup , which owns a chain of 5-star hotels, resorts, spas, convention centers, restaurants, golf courses, and major entertainment complexes in Vietnam) met and approved the registration dossier for the public offering of additional shares to existing shareholders according to the offering plan approved at the General Meeting of Shareholders in mid-November 2024.
Thus, another step has been completed, bringing the initial public offering (IPO) plan of the "giant" in the resort real estate industry closer to its launch date.
According to the plan approved by shareholders, the offering is expected to take place in the fourth quarter of 2024 or the first quarter of 2025. Vinpearl will issue 70 million shares, equivalent to an exercise ratio of 1,000:40,673. With an offering price of VND 71,350 per share, Vinpearl estimates it will raise nearly VND 5,001 billion if the shares are successfully distributed to shareholders.
Previously, Vinpearl achieved great success in its private placement in early 2024, raising over 15,000 billion VND. While the possibility of distributing 100% of the issued shares remains uncertain, the attractiveness of Vinpearl shares is further enhanced by the company's completion of its public company registration. In addition, the plan to list the shares on the stock exchange, hinted at at the parent company Vingroup's shareholders' meeting earlier this year, is expected to be implemented soon.
Masan Consumer Corporation (Masan Consumer) also plans to offer shares to existing shareholders at a rate of 45.1%. The company will offer 326.8 million new shares, expected to raise VND 3,268 billion and increase its charter capital to over VND 10,623 billion. Along with the offering plan, the transfer to listing on the HoSE (Ho Chi Minh Stock Exchange) has already been approved by shareholders. This new listing on the HoSE could be one of the sparks that "rekindle" the IPO market, which has been stagnant for many years.
IPO activity in Vietnam has remained subdued since the Covid-19 pandemic, despite periods of growth and dynamism in the secondary stock market. As 2024 draws to a close, the number of completed IPOs remains negligible. There have been no privatization auctions of state-owned enterprises. IPOs have only occurred in a few private companies, most notably the offering of 30 million shares by DNSE Securities Joint Stock Company.
Removing policy bottlenecks
Not only are preparations underway to welcome major deals as notable companies are ready to launch IPOs, but upcoming policy revisions are also expected to encourage IPOs when linked to listing activities.
Shortly after the National Assembly officially approved the Law amending and supplementing a number of articles of 9 laws, including the Securities Law, the draft amendment to Decree 155/2020/ND-CP detailing the implementation of a number of articles of the Securities Law is currently being reviewed by the Ministry of Finance and the State Securities Commission, with many changes aimed at increasing transparency and simplifying administrative procedures in the securities sector and securities market.
Specifically, with the goal of shortening the securities listing process, the drafting agency is proposing to reduce the time frame for organizations registering for listing to bring securities (stocks, bonds) into trading under Articles 111 and 118 of Decree 155/2020/ND-CP. The deadline for bringing securities into trading will be reduced from 90 days to 30 days from the date the stock exchange approves the listing registration. This change aims to better protect the rights of investors in exercising their securities transfer rights in the organized market.
In addition, the Draft removes the requirement for "adjusted securities registration certificate issued by the Vietnam Securities Depository and Clearing Corporation (VSDC)" from listing/trading registration dossiers; and changes to listing/trading registration as stipulated in Articles 110, 114, 115, 116, 117, 118, 134, 135, and 136 of Decree 155/2020/ND-CP.
"The listing/trading registration conditions do not require businesses to complete the securities registration procedures at VSDC. Furthermore, the stock exchange's review of listing/trading registration applications is a process independent of securities registration at VSDC. This revised regulation also shortens the listing/trading registration process," the drafting agency's report emphasized.
Key to attracting foreign investment
In the draft amendment to Decree 155/2020/ND-CP, one of the major areas addressed is opening the door wider for foreign investors to access the market, particularly focusing on solutions to support the process of upgrading the market from frontier to emerging market status. Many organizations have presented projected figures for foreign investment flows after Vietnam becomes an emerging market. However, to realize these figures once the stock market is actually included in the FTSE's secondary emerging market group, the major challenge is identifying specific locations where foreign investors can disburse their funds.
- Mr. Dang Thanh Cong, Director of Investment Banking Services Division in Northern Vietnam, KB Securities Joint Stock Company (KBSV)
As the technology sector becomes a trend attracting investment capital, the shortage of shares in this sector has highlighted a weakness in the diversification of the Vietnamese stock market. Many companies targeted by international funds no longer have sufficient foreign ownership room for investment.
Furthermore, according to Mr. Nguyen The Minh, Director of Analysis at Yuanta Securities Vietnam, when upgraded by FTSE, the market capitalization of Vietnamese stocks will be compared with other markets in the same group. If market capitalization does not grow, there is a risk of being removed from the emerging markets group.
In Vietnam, IPOs and listings are two separate processes, leading to a situation where investors, especially foreign investors, have to wait several months after purchasing shares before they can trade them. The proposal to shorten the time between IPO and listing to a maximum of one month is highly appreciated and could become an incentive to encourage more companies to list.
Although administrative procedures have been simplified, some requirements have been added in the Law amending and supplementing a number of articles of 9 laws, including the Securities Law. Specifically, Article 18 on the registration dossier for public offering of securities adds "a report on the contributed charter capital at the time of registration for the initial public offering of shares, audited by an independent auditing organization as prescribed by the Minister of Finance." At the same time, the responsibilities have also increased for all parties involved in the advisory process.
According to Mr. Dang Thanh Cong, Director of Investment Banking Services in the North at KB Securities Joint Stock Company (KBSV), the new regulations create significant pressure on businesses and consulting firms to meet the new requirements, and will also increase costs and preparation time for initial public offerings (IPOs). However, these changes will certainly help increase transparency and standardization in the primary market.
Source: https://baodautu.vn/cho-cu-hich-tren-thi-truong-ipo-d232352.html
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