Tuesday, November 24 2020


HNX develops unlisted market

Update: June, 09/2016 - 09:00


With more than 300 companies with unlisted stocks, UPCoM was now was a ‘highlight’ of the HNX with the strongest growth.— Photo dautuchungkhoan.vn

HÀ NỘI  — Hà Nội Stock Exchange chairman Nguyễn Thành Long said the exchange reported fruitful results seven years after shifting from the stocks centre.

The highlight of the results was the development of the unlisted market.  

Long said trading activities were more exciting in the first five months of 2016. As of June 6, 2016, the average transaction value reached more than VNĐ5.4 trillion (US$240 million) in each trading session, an increase of VNĐ1.1 trillion over the same term last year.

Of these, listed stocks reached VNĐ510 billion in each session, UPCoM stocks reached VNĐ129 billion each session, and the government bond auction reached VNĐ5 trillion in each session.

The total market capitalisation reached VNĐ1,099 trillion, including VNĐ148.6 trillion of listed equities, and VNĐ840 trillion of government bonds.

The chairman also said there were 171 initial public offerings (IPOs) auction via the bourse from 2014 to 2016, nearly doubling in quantity compared to the period 2009 to 2013. The ratio of winning bid reached over 85 per cent of the offerings. The rate of the winning value was also double compared to the previous period.

The chairman said the strong growth of HNX was thanks to the government’s timely guidance and policies to remove difficulties and shortcomings in the equitisation of State-owned enterprises (SOEs).

In 2014 and 2015, it was the deadline for the restructuring of many SOEs, so all the relevant agencies made efforts in the regard.

In the last six months, big firms with trillions of dong in capital, such as Vietnam Pharmaceutical Corporation (Vinapharm), Việt Nam Engine and Agriculture Machinery Company and possibly one of the three biggest telecom providers Mobifone, have launched their IPOs in the bourse.

UPCoM attraction

With more than 300 companies with unlisted stocks, UPCoM was now was a ‘highlight’ of the HNX with the strongest growth.

The current capitalisation of more than VNĐ111 trillion ($5 billion) was 25 times bigger than when it started in 2009. The number of firms in the market reached 303, ten times bigger than 2009. Total trading volume was of VNĐ130 billion, far better than VNĐ4 billion in 2009.

Notably, the market capitalisation of the unlisted stock market (UPCoM) reached VNĐ111.2 trillion, more than double compared with the end of 2015.

Seeing the growth of the market, HNX was also trying to create more excitement for investors to attract capital and increase liquidity to the market.

Long said that most of the investors were interested in stocks with high liquidity and trading value. Therefore, in the first half of this year, HNX implemented numerous measures to promote synchronised market transactions, such as equitisation regulations to associate with listing and transactions in the exchange.

In particular, HNX was working with others for the revision of Circular 74 that allowed faster and easier transactions for investors and the Circular 108 that enforced firms to list in the market after IPO.

“All this is aimed to boost the local liquidity in the market,” Long said.

In another solution to boost the UPCoM, on June 24, the HNX would officially divide stocks on UPCoM into two sets of the UPCoM Premium set with stocks of good financial health and transparency and the UPCoM Warning set with restricted stocks with suspended trading due to the firms’ accumulated losses or failure to report their financial statements and other problems.

While the warning set was already announced, a list of stocks in the premium set would be announced five days before the date.

Long said, "It is one of the core policies of the HNX to increase registration of shares traded on UPCoM, aim to increase transparency, and narrow the gap of the official market and the unofficial market for unlisted stocks. — VNS

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