Vietnam’s state-owned firms in IPO drive

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ViglaceraVietnam is planning a number of initial public offerings (IPOs) for the country’s largest state-owned enterprises in 2014, as the government seeks to restructure and open parts of the economy to foreign investors.

National carrier Vietnam Airlines, Vietnam National Textile and Garment Group (Vinatex) – the country’s biggest producer of textile and apparels – and Viglacera Corp., the leading maker of building and construction materials, are among firms likely to sell IPOs this year, the Finance Ministry said in a statement on January 15.

The government also plans to reduce its stakes in various listed firms through 2015, the ministry said in the statement. No specific companies were named but the government owns large stakes in PetroVietnam Gas, Vinamilk and Bao Viet Holdings.

Trading activity on Vietnam’s two stock exchanges in Ho Chi Minh and Hanoi has been relatively low compared with its Southeast Asian peers. But this may change as the government signals it is ready to boost equity-market development by allowing more investment choices. The nation’s benchmark index rose 22 per cent last year, outperforming a 0.6 per cent gain in the MSCI Southeast Asia Index, a broad measure of the region’s stock performance.

The government also plans early this year to raise the foreign-ownership cap on listed companies to 60 from 49  per cent to attract foreign capital. However, it wasn’t clear how much the firms would raise in their IPOs. Vietnam Airlines made a 2013 pretax profit of $27 million while Vinatex’s total 2013 export revenue was $2.9 billion.

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Reading Time: 2 minutes

Vietnam is planning a number of initial public offerings (IPOs) for the country’s largest state-owned enterprises in 2014, as the government seeks to restructure and open parts of the economy to foreign investors.

Reading Time: 2 minutes

ViglaceraVietnam is planning a number of initial public offerings (IPOs) for the country’s largest state-owned enterprises in 2014, as the government seeks to restructure and open parts of the economy to foreign investors.

National carrier Vietnam Airlines, Vietnam National Textile and Garment Group (Vinatex) – the country’s biggest producer of textile and apparels – and Viglacera Corp., the leading maker of building and construction materials, are among firms likely to sell IPOs this year, the Finance Ministry said in a statement on January 15.

The government also plans to reduce its stakes in various listed firms through 2015, the ministry said in the statement. No specific companies were named but the government owns large stakes in PetroVietnam Gas, Vinamilk and Bao Viet Holdings.

Trading activity on Vietnam’s two stock exchanges in Ho Chi Minh and Hanoi has been relatively low compared with its Southeast Asian peers. But this may change as the government signals it is ready to boost equity-market development by allowing more investment choices. The nation’s benchmark index rose 22 per cent last year, outperforming a 0.6 per cent gain in the MSCI Southeast Asia Index, a broad measure of the region’s stock performance.

The government also plans early this year to raise the foreign-ownership cap on listed companies to 60 from 49  per cent to attract foreign capital. However, it wasn’t clear how much the firms would raise in their IPOs. Vietnam Airlines made a 2013 pretax profit of $27 million while Vinatex’s total 2013 export revenue was $2.9 billion.

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