HA NOI (VNS)– Fifteen companies have been forced to delist their shares on both national stock exchanges since the beginning of this year due to prolonged losses, while the number of delisted businesses are forecast to continue rising in the coming time.
According to data from both exchanges, six companies were delisted from the HCM City Stock Exchange in the first nine months, three of which were due to incurring losses for three consecutive years, including two seafood processing companies Basa (BAS) and Cadovimex (CAD) and Viky Plastic Co (VKP).
Cavico Viet Nam Mining and Construction Co (MCV) was the only company to leave due to repeated violations on information disclosure. MCV has yet to report its financial statement for the fourth quarter of last year. The company's accumulative losses over three quarters in 2011 was VND3.5 billion (US$167,000).
Two other codes also left the exchange voluntarily, including Mekophar Chemical Pharmaceutical Co (MKP) and Sai Gon Beverage Co (TRI).
Among the nine delisted companies on the Ha Noi Stock Exchange, more than half were due to business losses, including Viet Hai Shipping and Real Properties (VSP), An Giang Coffee (AGC), construction Vinaconex No 11 (V11), Vung Tau Petroleum Trading and Service (VMG) and Habubank (HBB).
HBB alone cancelled 405 million listed shares, the biggest volume thus far, in order to merge into Sai Gon-Ha Noi Bank (SHB), while the others voluntarily cancelled their listings in the hopes of merging into other businesses to increase their competitiveness or to facilitate a move to the Unlisted Public Company Market (UPCoM).
"The reputations of companies that perform well but continually see their stock prices fall will be damaged," said Phan Dung Khanh, head of Kim Eng Viet Nam Securities Co's Analysis and Investment Consulting Division, before suggesting that their removal from the national stock exchanges represented a golden opportunity for rivals to acquire their business. "In this case, voluntary delisting is the best strategy.
The HCM City bourse recently announced the list of shares subject to possible cancellation. esides several companies risking teir listing due to consecutive losses, such as Sacombank Securities Co (SBS) and Sai Gon Cable (CSG), others plan to delist of their own accord.
According to leaders of the Ha Noi Stock Exchange, the number of delisted companies is increasing but the number of companies filed to list shares has decreased on both exchanges. As of August this year, only 16 companies have registered to list shares, a fraction of the 54 registered last year and 193 in 2010. — VNS