At a snail’s pace

Investors’ patience seems to be running out, as Vietcombank, once again, has said that its IPO will be delayed as it will take some more time to select foreign strategic partners. However, they have been calmed down as Deputy Prime Minister Nguyen Sinh Hung has released a document, saying that Vietcombank’s IPO must take place in 2007.

Now investors know for sure that they will have an address to send money to. Meanwhile, they have not heard any new information about other big corporations’ IPOs, because the corporations themselves and state management authorities are not hurrying to inform them.

While Vietnamese investors are thirsty for Vietcombank’s IPO’s information, foreign media, quoting unnamed sources, said that the share price at which Vietcombank’s shares would be sold to foreign partners could be 5-7 times higher than face value. If so, the selling prices would be VND50-70,000/share.

However, in a talk with the press, a Vietcombank official said that the bank had to carry out the equitisation in the same way as Bao Viet, the insurer: i.e. it will make IPO first and then define the selling prices for foreign partners.

In fact, the negotiations with foreign partners on selling prices have not succeeded, and Vietcombank has still proposed that the government allow it to make IPO in December. 6.5% of chartered capital will be sold to domestic investors.

The plan for the IPO has been ready, and if the government gives the nod, Vietcombank will make its IPO immediately, which will help create an impetus to the stock market in the last months of the year, said the official.

However, the plan remains a proposal, and no one knows for sure when Vietcombank’s IPO will take place.

Another big name, Sabeco (the Saigon Brewery Company), also cannot say exactly when it will make IPO. The company has wrapped up the enterprise valuation, estimated at VND6,800bil, and has reported about this to the Ministry of Finance, but has not had any reply from the ministry.

Trinh Thi Tuyet Minh, Finance Director of Sabeco, said that the company itself wanted the equitisation process to be sped up, but it was told to wait for some more time.

Mrs Minh said that it would take time to wait for the Ministry of Finance to accept the enterprise valuation report and for the Ministry of Industry and Trade to release the decision on approving the equitisation plan. If Sabeco can get the decision in November, it would not be able to make IPO until the first quarter of 2008.

Habeco (Hanoi Brewery Company) now is also waiting for the Ministry of Finance’s decision. An officer from the company said that it took several months to consult with the ministry about the value of the company brand name.

VMS-MobiFone, the telecommunication service provider, has not released any information about the equitisation consultants, though the bidding was opened three months ago. The Minister of Information and Communication in the latest meeting with the company’s leaders urged the company to speed up the equitisation.

Market remains attractive

According to the Securities Depository Centre, Vietnam’s bourse is still attracting foreign investors despite the ups and downs of the market. In October, the centre granted trading codes to 494 institutions and 7,603 individual investors. In October, foreign investors injected $150mil in the market. However, a huge sum of money, estimated at $3bil, is still outside the market, waiting to be disbursed for big IPOs.

Experts from the Saigon Securities Incorporated say that Vietcombank’s IPO will help stimulate the market. Meanwhile, it is regrettable that the exact date of the IPO has not been defined.

In the latest report about Vietnam’s stock market, the Hong Kong and Shanghai Banking Corporation (HSBC) says that Vietcombank’s IPO, if successful, will help attract more big investment funds.

Source: DTCK.