Want to be in the loop?
subscribe to
our notification
Business News
UNLISTED PUBLIC COMPANY MARKET PROMISES INVESTORS BETTER PERFORMANCE
The Unlisted Public Company Market (UPCoM) has grown over the last 10 years and become more transparent, attracting increased interest from investors.
UPCoM began operation on June 24, 2009 after the Government and market regulators realised the free-trading stock market had been highly risky for investors.
The launch of UPCoM aimed to tighten the free market and expand the size of the Government-controlled market to gather unlisted companies and make their stocks more transparent, secure and safer for investors.
Since then, many policies have been issued to improve the market's operation.
For example, Decree 60/2015/NĐ-CP eyes better protection of investors’ benefits by requiring public companies to trade shares on UPCoM, while Circular 115/2016/TT-BTC requires State-owned enterprises to both sell State capital and trade their shares on UPCoM.
The improvement of the legal framework has been a boost to the market's performance. In the first six years of operation, there were only 169 companies on UPCoM with average daily trading value of VND15 billion (US$544,300).
In the last four years, the number of UPCoM-traded firms has increased five-fold to 833 and average trading value has increased 18 times to VND250 billion.
Market capitalisation also rocketed to VND945.8 trillion in the same period. Foreign trading rose to VND16.9 trillion in 2018 from VND157 billion six years before.
According to a Stock Exchange of Thailand official, the development of UPCoM was a lesson for many regional markets.
UPCoM helped public companies test their stocks before moving to the main listed markets (the Ho Chi Minh and Hà Nội stock exchanges) and was a place for SOEs to offload State capital in the most efficient way, he said.
However, UPCoM has encountered some incidents that have raised public concern about the market’s transparency and ability to protect investors.
The worst case involved the Central Mining Joint Stock Company, which used to trade shares on UPCoM under code MTM.
The former leaders of the company falsified its trading portfolio and earned dozens of billions of đồng by selling company shares to investors.
That case forced the market regulator to release a list of good-quality stocks and those that were at risk to protect investors.
According to Nguyễn Thành Long, chairman of the management board at the Hà Nội Stock Exchange, UPCoM requirements on companies’ stock trading were not that strict, so about half of UPCoM-traded firms had low levels of transparency.
There were still many small companies recording poor business results and lacking transparency in terms of information disclosure, he told tinnhanhchungkhoan.vn.
The northern market regulator, besides drawing up a warning list on low-quality stocks, has implemented a scoring mechanism to highlight companies with high quality of information disclosure and transparency, he added.
The Hà Nội Stock Exchange plans to ask the State Securities Commission to allow investors and securities companies to do marginal trading on good-quality UPCoM-traded firms to increase the market’s liquidity and prove the market's transparency to investors.
Source: VNS
Related News
DIGITAL TRANSFORMATION IN LOGISTICS – A KEY TO UNLOCKING SUSTAINABLE E-COMMERCE AND ECONOMIC DEVELOPMENT
Accelerating digital transformation in logistics is critical in order to promote the sustainable development of e-commerce, a conference on applying technology held by the Ministry of Industry and Trade heard on Thursday, as well as accelerating overall economic growth.
SOILBUILD EXTENDS ITS HORIZONS INTO VIETNAM INDUSTRIAL REAL ESTATE
Soilbuild Group, an integrated real estate group, has broadened its investment in industrial real estate to Vietnam through its Soilbuild International division. The official launch of Soilbuild International (Vietnam) took place in Hanoi on May 9th, 2024, and was attended by esteemed guests, including domestic and international partners.
SEMINAR: BUSINESS SPOTLIGHT - THE HONG KONG-INSPIRED PRESENCE NESTLED IN THE HEART OF HANOI'S EAST
16h00 - 18h00, Wednesday (May 22nd, 2024)Almaz Convention Center - Hanoi (GG map: https://maps.app.goo.gl/YtWyGgkiTwWvFnfX6)
VIETNAM SECURES REMARKABLE ECONOMIC SUCCESSES SINCE NATIONAL REUNIFICATION
Since the national reunification on April 30, 1975, Vietnam has obtained admirable economic achievements and is now on its way to become the 20th largest economy in the world. Back to 1975, Vietnam, torn by two major wars, was a backward economy dependent on agriculture and foreign assistance. Foreign loans and aid accounted for over 63 percent of its budget.
350 EXHIBITORS TO TAKE PART IN HCM CITY PAPER, COATINGS, RUBBER, PLASTIC EXPOS
They will have a total display area of 10,000sq.m, 30 per cent more than last year, and the participation of over 350 local and international exhibitors who will showcase thousands of products and technologies.
INT’L INVESTORS EYE VIETNAM’S DATA CENTER MARKET – REPORT
Vietnam’s data center market is increasingly attractive to foreign investors, driven by the country’s expanding digital economy, rising data consumption, and supportive government policies, said a new report by JLL. While Vietnam’s data center sector has traditionally been dominated by local telecommunications companies, global players are now entering the market.