OTC market heats up on State-owned firms

Shares of many big enterprises have become hot commodities in recent days on the over-the-counter (OTC) market as investors bet on yet to list companies to be superstars on the Unlisted Public Company Market (UPCoM).

The success of State-owned companies such as Hanoi Beer Alcohol and Beverage Corporation (Habeco) and Airports Corporation of Vietnam (ACV) when debuting on the UPCoM has buoyed trade on the OTC market.

Vietnam Airlines, Saigon Beer-Alcohol-Beverage Corporation (Sabeco), Quang Ngai Sugar JSC, Truong Hai Auto Corporation and Vietnam National Petroleum Group (Petrolimex) are all floating on the OTC market and are on investor’s radars.

According to big brokers, the stock prices of these companies have increased in the past month because of rapidly rising demand.

A share in Vietnam Airlines costs about 40,000 VND (1.78 USD), a rise of 79 per cent over its IPO price of 22,300 VND in November 2014.

The national flag carrier has been quiet since its IPO after 99 per cent of its 49 million shares for sale were collected by two banks, Vietcombank and Techcombank. Its recent price hike was attributed to the listing success of ACV whose stock price has shot 64 per cent in the first week of trading, from 25,000 VND per share on November 28 to nearly 41,000 VND on November 30.

ACV’s price is also 180 percent higher than its IPO price in December 2015.

Vietnam Airlines early this week asked its shareholders to register their ownership by the end of this month to serve its registration on the UPCoM in December.

“This investment wave on the OTC focuses on State-owned enterprises which have made initial public offerings,” Nguyen Huu Minh, Director of EPS Investment Consulting Joint Stock Company was quoted by “Dau thau” (Bidding) newspaper as saying.

Minh said investors were looking to shares of equitised State-owned enterprises on the OTC and betting on prices rising once they are listed. In addition, the new regulation which forces equitised companies to trade on the UPCoM after an IPO has eased investors’ concerns over listing delays.

Prices of Habeco have also soared 94.5 per cent since its debut on October 28, shooting from 54,600 VND per share to 106,200 VND on November 25.

Investors expect similar success will be replicated in other shares on the OTC.

Shares of Quang Ngai Sugar, Truong Hai Auto and Petrolimex have also advanced in recent days. Shares of Truong Hai Auto are valued at 90,000 VND a share while that of Quang Ngai Sugar were bought at 82,000 VND and Petrolimex at 30,000 VND.

As State-owned enterprise equitisation is speeding up and the Government puts many market support policies in practice, analysts predict trading on the OTC market will continue to be buoyant in the future

Related news