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PetroVietnam’s capital withdraws to hit stock market, experts say

In Uncategorized on January 8, 2011 at 4:28 am

The oil and gas giant PetroVietnam’s capital withdrawals will effect the stock market in short-term and give a boost to some of its subsidiaries opportunities, financial experts said.

An investor watches share prices updated on a big screen at a HCMC-based brokerage (Photo:Minh Tri)

The Vietnam Oil and Gas Group, known as PetroVietnam, early this year began to withdraw its capital in its subsidiaries, which are not in the group’s core businesses.


The state-owned oil and gas giant also announced it would cut 51 percent of its holdings in the member companies specific in the group’s key fields


The move came from the state-owned gasoline supplier’s attempt to restructure its business model, of which the group will focus on mining and refining oil, according to PetroVietnam’s deputy general director Nguyen Ngoc Su.


The plans come at a time when market developments have facilitated the State’s withdrawal of investment in listed companies such as PetroVietnam Finance (PVF), Phu My Fertilizers (DPM) and Petroleum Technical Services Corp (PVS), baobariavungtau website quoted Su as saying.


The deputy director said PetroVietnam has “basically completed” their plan on restructuring and renewing its subsidiaries, with 14 units being equitised. So far, PetroVietnam has successfully auctioned more than 313 million shares, bringing in VND17,54 trillion (US$986.4 million).


Financial experts said PetroVietnam’s capital withdrawals would affect the slumping stock market, as well as share prices of its listed subsidiaries. However, selling shares in the firms not specific in core businesses will help the oil and gas group to regain a large amount, which will be reinvestments in current projects.


Stock analysts said oil stocks are among the market’s gainers in both short and long term. Listed enterprises specific in mining oil and renting rigs remain in black during the global economic turmoil, and will be the first ones growing sharply when the economy recovers, analysts said.


At present, two subsidiaries of the group including PetroVietnam Technical Services Joint Stock Corp. (PVS) and PetroVietnam Drilling and Well Services Joint Stock Company (PVD) are achieving healthy earning so far this year.


The former made a pretax profit of VND780 billion ($39 million) from a revenue of VND15 trillion in the first ten months of the year. The core businesses’ growth rate of PVS this year rose to over 20 percent year-on-year. PVS closed 2.84 percent lower at VND20,500 on the Ho Chi Minh Stock Exchange on Saturday.


PetroVietnam Joint Stock Finance Corporation (PVF) will likely to achieve thousands of billions of Vietnam dong from exporting crude oil, while PetroVietnam Insurance Joint stock Corp. (PVI) is providing insurance services to a large amount of clients, which are PetroVietnam Group’s subsidiaries and partners.


“There are 25 oil and gasoline firms listing on both exchanges in Ho Chi Minh City and Hanoi. They have a great chance of earning big bucks as local consumer demand for oil this year remains high and the global crude oil price is increasing,” said a director of a HCMC-based brokerage.

Source: SGGP

Bearish market sees senior staffs earn less

In Uncategorized on January 8, 2011 at 4:27 am

The slumping stock market leaves brokerages struggling to pay high-class personnel including market analysts and financial experts with high salary. 

Two brokers (in front) watch listed companies’ profile on their laptop at a HCMC-based brokerage (Photo:Minh Tri)

A broker earns an average payment of around VND4-5 million (US$200) per month, a director of a HCMC-based brokerage said, adding some brokerages pay low salary with high commission to encourage their brokers to work harder.


A new graduate now working as a broker at a brokerage in HCMC, only identified as L., said his monthly salary was too low for extra personal meetings to win more clients.


“My colleagues make enough money for living even in bearish time as they have a lot of clients,” L. said.


Some brokers agree to work with low payment as they are offered rights to buy shares with special prices.


An experienced broker, who asked not to be named, said she turned down a securities firm’s offering with higher salary as the current brokerage sold her shares in profitable companies with preferential prices.


“Brokerages are hunting talented candidates for the position of managing the market analysis department,” Nguyen Thanh Hung, general director of the Sacombank Securities JSC, said.


“However, a few are willing to take that job in spite of the high salary of more than VND20 million per month. The market research and analysis department is mainly criticized for their wrong predicts when the market is volatile,”


Similarly, a big brokerage paid $2,000 for the position of market analyst and financial experts. The firm’s market reports were considered as the best at that time, with detailed information and good analysis on listed companies’ business activities.


However, the firm then incurred huge losses from the market research and analysis department, which offered reports for free. Therefore, they eventually had to chop down the salary level to less than VND10 million. 


“Brokerages are very picky in recruiting brokers these days. At the outset, they recruited around 10 brokers. But then just a few of them, who proved their competence, will stay as the brokerages will take over clients of the remainders before throwing away,” a veteran broker disclosed.


Some other securities firms offered big payment to brokers holding a large amount of clients, asking them to make a monthly or quarterly fixed revenue in return.


A brokerage, which is one of the country’s 10 biggest securities firms, recruited a large number of brokers early this year, but it had to cut nearly half of the amount in the middle of the year due to the slumping market and the high employee cost.


“We tried to recruit part-time employees for our provincial branches in an attempt to cut operational costs. But just a few were willing to join as they want full-time jobs with stable payment,” he said.


“Good directors can make proper recruitment plans as they are good at analyzing the market. Common ones usually have to deal with either an abundant number of brokers in a bullish market or a shortage of employees in bearish market,” Pham Linh, general director of the Hanoi-based VISecurities JSC, noticed.

Source: SGGP

Cautiousness sends market down

In Uncategorized on January 8, 2011 at 4:27 am

Vietnam’s benchmark VN-Index failed to extend its winning momentum to the third day, tumbling on December 29 as investors switched to bearish sentiment.


The measure of 275 companies and five mutual funds listed on the Ho Chi Minh Stock Exchange lost 0.12 percent, or 0.58 points, to finish at 478.75 points.


Among the index members, 84 surged, 141 dropped, while 55 remained unchanged.


Trading volume sharply fell over the previous trading session; however, it still stayed on high level. Around 62.37 million shares changed hands at a value of VND1.47 trillion.


Saigon Securities Inc. (SSI), the country largest brokerage, continued to be the most active share in volume with 3.56 million shares changing hands.


Saigon Thuong Tin Commercial Bank or Sacombank (STB) was still behind with 3.23 million shares traded.


Vietnam Mechanization Electrification & Construction Joint Stock Company (MCG) came next with 2.4 million shares.


IDICO Infrastructure Development Investment Joint Stock Company (HTI) nosedived for seven consecutive sessions, eroding 9.62 percent to VND14,100.


Sieu Thanh Joint Stock Corporation (ST8) dumped 8.68 percent to VND22,100. The company will pay dividends for the second term of this year to its current shareholders in cash at a ratio of 10 percent.


Vietnam Export Import Commercial Joint Stock Bank or Eximbank (EIB) adjusted 7.83 percent to VND15,300.


Imexpharm Pharmaceutical Joint Stock Company (IMP) sank 7.26 percent to VND57,500. The company will issue 2,331,964 additional shares to its current shareholders at a price of VND20,000 per share, and a ratio of 10:2.


Cosmetics producer S.P.M Corporation (SPM) enhanced 4.96 percent to VND63,500.


Long Giang Investment and Urban Development Joint Stock Company (LGL) closed up 4.9 percent to VND21,400.


Tan Binh Import – Export Joint Stock Company (TIX) grew for four straight days, earning 4.73 percent to VND42,100.


The smaller bourse in the north made sharp correction as the Hanoi’s HNX-Index slashed 1.64 percent, or 1.88 points, to close at 112.93 points. Trading volume improved over the previous session, climbing to 50.7 million shares worth VND1.15 trillion.


Meanwhile, the UPCom-Index strongly jumped, gaining nearly 3 points to 44.75 points this morning. A total of 163,100 shares changed hands at a value of VND1.78 billion.

Source: SGGP

PetroVietnam’s capital withdraws to hit stock market, experts say

In Uncategorized on January 8, 2011 at 4:27 am

The oil and gas giant PetroVietnam’s capital withdrawals will effect the stock market in short-term and give a boost to some of its subsidiaries opportunities, financial experts said.

(Photo:Minh Tri)

The Vietnam Oil and Gas Group, known as PetroVietnam, early this year began to withdraw its capital in its subsidiaries, which are not in the group’s core businesses.


The state-owned oil and gas giant also announced it would cut 51 percent of its holdings in the member companies specific in the group’s key fields


The move came from the state-owned gasoline supplier’s attempt to restructure its business model, of which the group will focus on mining and refining oil, according to PetroVietnam’s deputy general director Nguyen Ngoc Su.


The plans come at a time when market developments have facilitated the State’s withdrawal of investment in listed companies such as PetroVietnam Finance (PVF), Phu My Fertilizers (DPM) and Petroleum Technical Services Corp (PVS), baobariavungtau website quoted Su as saying.


The deputy director said PetroVietnam has “basically completed” their plan on restructuring and renewing its subsidiaries, with 14 units being equitised. So far, PetroVietnam has successfully auctioned more than 313 million shares, bringing in VND17,54 trillion (US$986.4 million).


Financial experts said PetroVietnam’s capital withdrawals would affect the slumping stock market, as well as share prices of its listed subsidiaries. However, selling shares in the firms not specific in core businesses will help the oil and gas group to regain a large amount, which will be reinvestments in current projects.


Stock analysts said oil stocks are among the market’s gainers in both short and long term. Listed enterprises specific in mining oil and renting rigs remain in black during the global economic turmoil, and will be the first ones growing sharply when the economy recovers, analysts said.


At present, two subsidiaries of the group including PetroVietnam Technical Services Joint Stock Corp. (PVS) and PetroVietnam Drilling and Well Services Joint Stock Company (PVD) are achieving healthy earning so far this year.


The former made a pretax profit of VND780 billion ($39 million) from a revenue of VND15 trillion in the first ten months of the year. The core businesses’ growth rate of PVS this year rose to over 20 percent year-on-year. PVS closed 2.84 percent lower at VND20,500 on the Ho Chi Minh Stock Exchange on Saturday.


PetroVietnam Joint Stock Finance Corporation (PVF) will likely to achieve thousands of billions of Vietnam dong from exporting crude oil, while PetroVietnam Insurance Joint stock Corp. (PVI) is providing insurance services to a large amount of clients, which are PetroVietnam Group’s subsidiaries and partners.


“There are 25 oil and gasoline firms listing on both exchanges in Ho Chi Minh City and Hanoi. They have a great chance of earning big bucks as local consumer demand for oil this year remains high and the global crude oil price is increasing,” said a director of a HCMC-based brokerage.

Source: SGGP

Bitter end for acquired firms listing on stock market

In Uncategorized on January 8, 2011 at 4:26 am

Investors always expect that the mergers and acquisitions will bring booming time to their firm’s businesses, but many acquired enterprises are in red after the acquisition. 

Two investors discuss the stock market’s moves at the Ho Chi Minh City Securities JSC (Photo:Minh Tri)

Korea’s retailer Lotte announced its 40 percent stake in Vietnam’s confectionery firm Bibica (BBC), but some brokers said the actual holding is more than 51 percent, which put the Korean firm into the positions of chairman and financial manager in the candy maker’s board of directors.


The acquisition helps boost Bibica’s businesses and competitiveness, analysts said. However, Bibica is still miles behind the confectionery giant Kinh Do (KDC) in term of marketing, which is the most important skill in the candy industry.


Therefore, Bibica may not be among the great deal for both long-term and small-time investors, experts said.


Similarly, beverage firm Tribeco (TRI) incurs constant losses in seven years after Kinh Do bought its control stake. The firm now almost does not stand a chance to compete with both local and foreign rivals, including Tan Hiep Phat and Pepsi. Many brokers, therefore, put Tribeco into “Don’t buy” list.


Brokers and financial experts also pay high attention to mergers and acquisitions of securities enterprises, which are alongside banks to be the two main factors of the financial market.


However, the mergers and acquisitions in the last three years were ineffective as none of brokerages showed any improvement. The competitiveness of brokerages remains low, experts noticed.


“A company failing to beef up its acquired ones’ businesses will struggle to buy control stakes in other firms. Investors are hesitate to buy shares in big earning companies with low dividend rates and share prices treading water,” said a broker of a HCMC-based securities.

Source: SGGP

Stock market to jump up in first half of 2011, experts predict

In Uncategorized on January 8, 2011 at 4:26 am

Vietnam’s stock market will roar back in the first half of the year on the US’s bullish market, financial experts expect.

(Photo:Minh Tri)

The stock market in Vietnam last year were effected by many macroeconomic factors, while nearby markets including Singapore, Indonesia and Thailand were boosted by the US’s financial bailouts, said M.A. Le Dat Chi, head of the financial investment faculty of the University of Economics Ho Chi Minh City.


“A part of the US$600 billion bailout of the US flew into Asian markets, especially emerging ones. It was just a small proportion for the US market, but it did make big impact to emerging markets, except of Vietnam,” Tri said.


Only investors holding control stake in listed enterprises made profits from dividends as the VN-Index dropped to 430 points in the last quarter of last year, with many shares slumping to incredible levels, he said.


“Vietnam’s stock market is at the bottom, with the ratio of dividends per share equal to 15 percent. This rate is extremely attractive to some investment funds,” the economist said.


“Besides, investors’ confidence in a successful Eleventh Party Congress with new members elected into the central committee will boost the market sentiment. Foreign investments will flow stronger into the stock market, which hit the bottom. Therefore, the market will likely to roar back in 2011.”


Statistics showed nearly the foreign indirect investments (FII) pour into the stock market last year reached $1 billion. Stabilizing the foreign exchange rate should be the top priority this year to attract more FII, Tri noticed.


The financial expert also recommended that more adequate taxes on shares will attract more foreign investors.


“Instead of asking foreigners either to pay security before entering the market or not to sell shares in at least one year, we can impose taxes on the dividend from their share investments,” he suggested


Stock market analysts also predict the market will likely to recover strongly in the first half of the year on the increase of the US market.


“The US dollar getting weaker in the first half of 2011 will be good news for the country’s stock market. However, it will be stronger again in the last half. The market’s winning run will likely to last until June, with Dow Jones Index climbing 12,600 points,”  Tri said.


Statistics showed the stock market usually climbs up in March, April and December every year.


However, the market is still carrying some risks including the US dollar getting stronger constantly, warned Pham Xuan Anh, deputy head of the brokerage BIDV-BSC’s market analysis unit.


“Standard Chartered Bank expected the foreign exchange of Vietnam dong and dollar will reach VND20,800 per dollar at the end of the year, a year-on-year increase of around 6.6 percent,” said Tri.


“The Asia Development Bank last September predicted Vietnam’s inflation in 2010 would rise to 7.5 percent, caused by a weakening dong and an increase in food prices.”


Low foreign currency reserve and large amounts of dollar and gold owned by residents would put the central bank in difficult time, Tri added.

Source: SGGP

Builders release promotional packs to heat up market

In Uncategorized on January 8, 2011 at 4:06 am

House builders in Ho Chi Minh City made debuts of many projects on new houses and apartments with a lot of promotional programs in an attempt to thaw the frozen market.

(Photo:Minh Tri)

The property firm Thuduc House (TDH) planned to kick off its sales of the TDH – Phuoc Binh apartment building in District 9 next year. The construction on foundation and basement of the 5-storey building was finished, the firm announced.


Thuduc House offers the first ten buyers a discount of VND15 million (US$750). Customers buying 3-8 apartments will be offered a 1-2.5 percent discount, while ones paying in advance 50-70 percent of the apartment’s value will enjoy a 2-3 percent discount.


Nha Pho Viet Nam JSC released a big promotional pack for its apartment building City Garden in Binh Thanh District, inviting visitors to attend a drawing contest to win a discount of up to VND200 million – 1.4 billion. Another property company Dat Xanh JSC starts the “Buying an apartment – Winning a car” program.


A construction firm Phuoc Thanh announced on December 15 to start selling the first phase of its property project named Hoang Kim The Gia in Binh Tan District with the price of VND900 million ($45,000) only. Buyers will also get an discount of VND30 million, the firm said.


Phuoc Thanh’s investment manager Danh Thanh Xuan said a large amount of buying orders forced his company to sell apartments before the building construction finish.


“Four main asset classes now are property, stock market, foreign currency and gold. However, foreign exchange rate is fluctuating, with the US dollar getting stronger day by day; while gold surged too high now,” said Nguyen Vu Bao Hoang, Thuduc House’s deputy general director.


“Stock market, meanwhile, shows some signs of recovering. I expected investors will soon return to real estate market with profits they gained from the stock exchange,” Hoang said.


The property firm Sacomreal’s chairman Dang Hong Anh has a similar predict with his counterpart, saying the property market will likely to boom in 2011.


“The market’s recovery will depend on the government’s economic policies. Some foreign economists said a financial bailout worth $600 billion released by the US’s Federal Reserve is partly flowing into Asian markets, including Vietnam. The US investors still consider Vietnam as an attractive destination,” Anh noticed.


“Many problems including inadequate infrastructure, high inflation and fluctuated foreign exchange rate have effected the real estate market. Property regulations were amended, but some of regulations remain conflicted with each other,” warned Le Chi Hieu, vice chairman of the Ho Chi Minh City Property Association.

Source: SGGP

Cool real estate market replaces foreign distributors with local ones

In Uncategorized on January 8, 2011 at 4:06 am

High-end real estate segment used to be dominated by foreign-owned firms such as CBRE Vietnam, Savills Vietnam, Coliers, Cushman Wakefield or Knight Frank, who have the upper-hand in design consultancy, management, marketing and sales.

(Photo: Minh Tri)

But those days are gone.


With the market cooling off and investors turning their back to high-end properties, foreign real estate firms over the past year no longer had a good time.


Savills, Knight Frank and CBRE for the past year had to give the chance to distribute the Indochina Plaza Hanoi project to Hanoi-based DTJ Group.


The priority to distribute the project was once associated with Savills Vietnam. Then its competitors such as Knight Frank and CBRE, the famous real estate service provider stepped in. But all have been replaced by DTJ.


Other big projects in Hanoi such as Mulberry Lane or Cana Park have also replaced foreign distributors with local ones.


Vincom Group has also broken up with its long-year foreign partners. The corporation is selling its projects itself, such as it did with the Royal City project recently.


Several developers of high-end real estate projects in Hanoi said they are willing to invite local distributors instead of foreign-labeled ones.


For a long time, hiring a foreign distributor was the optimum choice as the foreign firms made good business and they gave the project a better name.


But according to experts in the field, difficulties of the market have made the matter of fame no longer important.


Meanwhile, foreign distributors asked for higher payment and have failed to renew their sales and marketing measures to fit in the cooling market. They have failed to sell the project on time or make the profit promised to the developers.


These foreign firms have lost a lot of spotlight. Their reports have been more biased and less accurate. Some were even contradictory to each other.


So they were replaced or supplemented with local firms, which have made big improvements over the past time with proven successes in sales, management and marketing.


It showed good signs for Vietnam’s real estate market, insiders said.

Source: SGGP

Investors anxious about stock market manipulation

In Uncategorized on December 21, 2010 at 9:36 am

Many shares on the stock market are being manipulating but the market watchdog fails to stop the issue, brokers said.

(Photo:Minh Tri)

The construction firm Song Da 9.06 (S96)’s share price surged to VND40,000 this month from the low level of VND15,000 last August, triggering questions about whether the price are being manipulated.


“Some listed firms’ board of directors and big shareholders manipulated their share prices by announcing their firm’s profitable business plans after buying back their shares strongly. And then they took big bucks by selling shares, which were boosted by the information,” said brokers.


Those key shareholders will use the profit from selling shares to buy back more shares in an attempt to ensure their main stakes in the firms, brokers said.


“Therefore, some listed firms focused on issuing additional shares, which will help them to raise their capital strongly,” said a broker in Ho Chi Minh City, who asked to be unnamed.


Last year, the construction company Sudico (SJS) clang on the price of VND60,000 in May before jumping up to VND210,000 five months later.


During the time SJS increasing, there was a rumor on paying dividends by additional shares on the stock market, which then came true as SJS’s share price surged to VND218,000.


PetroVietnam – Nghe An Construction Joint Stock Company (PVA) is among biggest gainers on the stock market this year.


The construction firm’s shareholders made big profits as the share price surged to VND120,000 from VND30,000 in only three months starting from February. Brokers said the share price was manipulated by many investors, who even posted their achievements on some websites.


Investors were anxious on information that Nguyen Thi Kim Phuong, a big shareholder of Cement Materials and Transportation Joint Stock Company (VTV), dumped her entire holding of 557,800 shares.


The State Securities Commission then fined Phuong and two other men VND370 million (US$18,500) for manipulating the share price. However, analysts said the fine was nothing compared with the profit they took from the affair.


Many investors suspected that brokerages, which those people opened trading accounts at, was also involved in the scam.


Similarly the transportation firm Ha Tien (HTV) rose to VND46,000 in September from VND16,000 in June before slumping nearly 75 percent to VND15,400 on December 20.


Some brokers said the slump came after market manipulators failed to boost the share price, while others said manipulators sold the share strongly to take profits from previous surges.


Le Van Dung, chairman and general director of the drug marker Vien Dong (DVD) listed on the Ho Chi Minh stock market was arrested for manipulating share prices last month.


The HCMC-based pharmacy maker earlier was fined VND50 million (US$2,500) for not buying shareholdings in Ha Tay Pharmaceutical JSC (DHT) as it registered to the commission.

Source: SGGP

Brazil overtakes Germany as 4th biggest car market

In Uncategorized on December 21, 2010 at 9:32 am

Brazil this year overtook Germany as the fourth-biggest car market in the world — and foreign investors see huge potential as the Latin American giant becomes increasingly prosperous.


At the end of 2010, a total of 3.45 million vehicles are forecast to have been sold in Brazil, nearly 10 percent more than last year, according to the national automobile manufacturers’ association Anfavea.


That would position Brazil behind China, the United States and Japan in sales of cars and light trucks, and just ahead of Germany.


“This in itself is already big attraction for a growing market, with a low density of vehicles per inhabitant,” Anfavea president Cledorvino Belini told AFP.

File photo of traffic on the Tiete highway, one of the ring roads most prone to traffic-jams in in Sao Paulo, Brazil.

He explained that Brazil, with a population of 192 million, had approximately one vehicle per seven residents, leaving plenty of room for growth.


There are some 30 million vehicles in total in Brazil, and the world’s big car companies expect that fleet to balloon as the country’s economic boom creates more consumers.


Europe and the United States, in contrast, are seen as saturated markets with minimal growth prospects.


Brazil “is a market that should keep growing over coming years, and that is attracting a lot of investment,” said Belini, who is also the head of the Brazilian subsidiary for Italy’s Fiat.


“We have competent workers. We also have all the primary materials for our product,” along with a dynamic economy, controlled inflation and easy credit for car-buyers, he said.


To underline the corporate optimism in Brazil, Fiat last week announced it was building a second factory in the country to the tune of 1.8 billion dollars. That was part of a 5.9-billion-dollar investment plan for Brazil that Fiat is rolling out between 2011 and 2014.


Fiat is intent of keeping its number one status in the Brazilian market, where it accounts for 23.1 percent of sales.


Germany’s Volkswagen is a close second with 22.7 percent, and US group General Motors is in third place with 21.2 percent, according to the national car dealers’ federation.


In terms of manufacturing, Brazil is the sixth-biggest vehicle producer in the world, turning out 3.64 million units under 17 different brands.


That base looks set to expand further with South Korea’s Hyundai and China’s Chery poised to also open factories.


That highlights Brazil’s enviable dual role as both Latin America’s biggest market, and “a production and development hub” for the region, Belini said.


Sixty percent of Brazil’s auto exports go to Argentina, while another 20 percent go to other parts of the continent, Anfavea said.


In terms of vehicle imports, 50 percent come from Argentina, 22 percent from South Korea and China, 10 percent from Mexico and 6.5 percent from Europe and the United States.


The panorama could change, though, as Brazil’s currency, the real, continues to soar against the dollar and the euro. That makes imported vehicles sought after by class-conscious Brazilians more affordable, and makes Brazilian exported vehicles more costly.

“We are feeling difficulties in competing in foreign markets, and at the same time imports are growing,” Belini admitted.

For now, however, the situation is rosy, with 780,000 vehicles being sold abroad, 64 percent more than 2009.

Source: SGGP