Securities firms raise capital on recovery of stock prices

August 10, 2022 - 08:09
Despite poor business results in the second quarter, many securities stocks have rebounded sharply after hitting the bottom on June 20-21.
A worker talking to an investor at MB Securities' office. Photo courtesy of MBS

HÀ NỘI — Despite poor business results in the second quarter, many securities stocks have rebounded sharply after hitting the bottom on June 20-21.

Accordingly, Việt Dragon Securities JSC (VDS)'s shares gained 84.7 per cent from VNĐ7,200 a share to VNĐ13,300, while shares of Saigon - Hanoi Securities JSC(SHS) also increased by 65 per cent from VNĐ8,904 to VNĐ14,700. Shares of MB Securities JSC (MBS) jumped 61.3 per cent.

Leading securities stocks like SSI Securities Corporation (SSI), Hồ Chí Minh City Securities Corporation (HCM) and VNDirect Securities Corporation (VND) to small stocks such as Vietnam Industrial & Commercial Securities Corporation (VIG), Hoa Binh Securities JSC (HBS), and Agribank Securities Corporation (AGR) also surged 30-50 per cent in the last month and a half.

Securities stocks have reported a good recovery as the general stock market picked up significantly from the area of 1,169 points to 1,252 points. 

Liquidity on the Hồ Chí Minh Stock Exchange (HoSE) also improved. Of which, in the last seven consecutive trading sessions, matching value reached VNĐ12-14 trillion, while previously the average matching value was just VNĐ8-9 trillion, and even fell below VNĐ5.5 trillion (US$235 million).

According to SSI Research, investors' attention switched from the US macroeconomic data to enterprises' profit growth in Q2 and expectations in the second half of the year. 

Even though risks from external factors still threatened the local stock market, the monetary policy stance of the State Bank of Vietnam (SBV) and economic support package are expected to lift market sentiment. Public investment is the main growth driver in the second half of 2022, with capital disbursement focusing on site clearance of priority investment projects.

After falling deeply in Q2, technical signals have shown some improvement. SSI Research believes that VN-Index is likely to hover around 1,220-1,300 points in August, while ​​1,300 points will act as an important resistance and determine the medium-term trend of the VN-Index.

Raising capital plans

With the advantages of favourable conditions, many securities companies are carrying out capital raising plans. 

VNDirect Securities is going to issue a total of 104.9 million shares to increase its capital to VNĐ2.1 trillion. Of which, it offers to existing shareholders 52.6 million units with the rate of 50 per cent; pays stock dividend of 36.8 million shares and rewards 10.5 million units, with a total rate of 45 per cent; and releases ESOP of more than 5 million shares at a rate 4.8 per cent.

The deadline for registration to make a list of shareholders was August 1. For the plan of offering shares to existing shareholders, the time for registering is from August 10 to September 7.

The offering price is VNĐ10,000.

The securities firm wants to raise about VNĐ576 billion to supplement operating capital for securities margin trading, advance payment, proprietary trading, and underwriting.

Meanwhile, MBS announced that August 15 is the final registration date to make a list of shareholders to pay stock dividends in 2021 and exercise the right to buy securities. The company will issue 53.5 million shares at a rate of 20 per cent to pay dividends and release 59.4 million shares to offer to existing shareholders with a rate of 22 per cent. 

Its total additional issuance volume is 113 million shares, and the charter capital is expected to increase from nearly VNĐ2.7 trillion to VNĐ3.8 trillion.

With the plan, MBS is expected to earn VNĐ594 billion to supplement and provide capital for margin business, and invest in developing an information technology system. The time to transfer the purchase right is from August 22 to September 7.

At a market price of VNĐ7,600 per share, VIG plans to offer 34.1 million shares to 11 investors, including an organisation and ten retail investors at VNĐ10,000 a share. Specifically, Thang Long Investment Group JSC will buy 8 million units, while the other investors purchase 1-3.1 million units.

Shares offered for private placement are restricted from being transferred within 1 year from the closing date of the offering. The implementation time is expected in the third and fourth quarters, after being approved by the State Securities Commission (SSC). Its charter capital is expected to double to VNĐ682 billion.

BIDV Securities Company restarts the plan of private placement of 65.7 million shares for Hana Securities Co., Ltd - Hana Financial Group (Korea) at the price of VNĐ41,000 a share, collecting over VNĐ2.69 trillion. In March, the two signed a stock purchase agreement. VNS