VND loses market share

In its recent report, DSC Securities Joint Stock Company (DSC) did not provide a valuation for VND shares of VNDirect Securities Joint Stock Company.

Previously, in May 2024, DSC still valued VND shares at 25,200 VND per share.

DSC assesses that VND is at risk of losing brokerage market share. As of the end of Q3/2024, VNDirect's brokerage market share on HoSE had decreased to 5.7%, falling to 6th place, the lowest since 2016.

"In the short term, VNDirect's market share is unlikely to recover strongly. Overall, VNDirect remains a major player in the brokerage market, but is under pressure from larger competitors amidst market volatility and competition," DSC commented.

To improve operational efficiency and expand market share, VNDirect is boosting its online brokerage channel, but it needs more time to see positive impacts.

Due to declining market share, VNDirect's margin lending has also been subdued amidst an increase in margin lending across the entire securities company group in the third quarter. VNDirect's outstanding loan balance reached nearly VND 10,900 billion, equivalent to the same period in 2023. There is still significant room for further lending as the loan-to-equity ratio at the end of the third quarter had decreased to 56%, significantly lower than the industry average.

VNDirect's proprietary trading portfolio continued to expand by over VND 3,000 billion in the third quarter, with a focus on government bonds and bonds issued by banks. This strategy will help reduce portfolio risk. Due to the high proportion of bonds and certificates of deposit, proprietary trading revenue mainly comes from profits on the sale of these financial assets and accrued interest. However, the sluggish stock market caused FVTPL revenue to decrease by 36% year-on-year. Revenue from HTM assets (deposits) also decreased sharply to VND 97 billion as VNDirect reduced its short-term deposit holdings.

In the third quarter, VNDirect's business results continued to show negative growth compared to the same period last year.

VNDirect's outstanding loan balance reached nearly VND 10,900 billion, equivalent to the same period in 2023. There is still significant room for further lending because the loan-to-equity ratio at the end of Q3 had decreased to 56%, considerably lower than the industry average.

VNDirect's loan growth over the past three quarters has been relatively sluggish compared to other major securities companies, as the company is gradually losing market share to competitors. VNDirect's brokerage market share on the HoSE in the third quarter fell to its lowest level since 2016, at only 5.7%.

VNDirect's proprietary trading portfolio continued to expand by more than VND 3,000 billion in the third quarter, with a focus on government bonds and bonds issued by banks.

According to the Q3 report, Financial Assets Recognized Through Profit and Loss (FVTPL) amounted to over VND 24,400 billion, an increase of VND 7,762 billion compared to the end of 2023, of which investments in unlisted bonds increased by VND 3,500 billion.

On the market, VND shares are experiencing significant volatility with a surge in liquidity and a downward price trend due to information related to losses incurred by companies in VND's bond portfolio, such as Trung Nam and Crystal Bay.

Crystal Bay Joint Stock Company is late in paying back the principal amount of VND 421 billion on November 5, 2024, to VNDirect, the bondholder who owns 100% of these bonds.

VNDirect has a charter capital of VND 15,200 billion, making it the securities company with the largest charter capital currently.

Source: https://baodautu.vn/dsc-du-bao-nguy-co-danh-mat-thi-phan-cua-chung-khoan-vndirect-d231985.html