Việt Nam’s stock market has grown modestly this year but shrinking inflows has made new listings less buoyant than expected.

 

The VN-Index on the Hồ Chí Minh Stock Exchange (HOSE) has increased 7 per cent so far this year, but the HNX-Index on the Hà Nội Stock Exchange has fallen more than 1 per cent.

 

These numbers are an improvement to 2018 when the VN-Index lost 9.3 per cent and the HNX-Index plummeted 10.8 per cent.

 

The growth of the VN-Index has been driven largely by large-cap stocks, while the general movement was a downward trend.

 

Cash flow into the market has declined with the daily trading value averaging just VNĐ4 trillion (US$172.4 million) this year, down 30 per cent compared to 2018.

 

This year, the Hồ Chí Minh Stock Exchange has only welcomed 13 new companies, down 63 per cent against 2018 and the lowest number since 2015, half of which were transfers from the Hà Nội Stock Exchange or the Unlisted Public Company Market (UPCoM).

 

The total volume of shares from new companies reached 4.8 million, a sharp decline compared to 7.12 billion in 2018.

 

Unlike last year, no banks have listed in 2019.

 

The two biggest listed companies were Vietnam Airlines (HVN) and PV Power (POW) with 1.4 billion and 2.3 billion shares, equivalent to market value of VNĐ49 trillion and VNĐ29 trillion, respectively.

 

Value of newly listed companies also fell. For example, shares in Vietnam Airlines are being traded below VNĐ34,000, down 16 per cent compared to its debut price of VNĐ40,600.

 

Shares in other companies such as PV Power, Power Engineering Consulting (TV2) and ICD Tân Cảng-Long Bình (ILB) also declined.

 

Companies pending approval

 

Currently, there are 15 listing documents with 6.8 billion shares pending for approval on the Hồ Chí Minh Stock Exchange, including big companies such as Investment and Industrial Development Corporation (Becamex), Maritime Joint Stock Commercial Bank (MSB) and the Vietnam Rubber Group (GVR).

 

Becamex plans to list more than one billion shares in January next year. It is already trading on the UPCoM under the code BCM at VNĐ29,000 per share.

 

Meanwhile, MSB will list 1.17 billion shares and GVR will move its four billion shares from the UPCoM to the HOSE. MSB is also the only bank that has sent a listing document to the HOSE this year. — VNS