Vietjet shares forecast to be added into ETF investee list

August 23, 2019 - 15:47


A Vietjet aircraft. The aviation firm's shares may be purchased by the US-listed fund VanEck Vectors Vietnam EFT in the upcoming quarterly portfolio review. - Photo

HÀ NỘI — The US-listed asset management fund VanEck Vectors Vietnam ETF (VNM ETF) may purchase shares of the new generation carrier Vietjet in its upcoming quarterly portfolio reshape.

The projection is made by Bảo Việt Securities Co (BVSC). In this projection, VNM ETF will buy more than 19.2 million Vietjet shares to increase the number of Vietnamese companies in its portfolio to 19 from the current 18.

Vietjet shares will then account for 4.21 per cent of VNM ETF’s total investment. Vietnamese shares are taking 71.83 per cent of VNM ETF’s total country’s weightings – much higher than other markets such as South Korea (14.65 per cent), Japan (5 per cent) and Taiwan (4.61 per cent).

To be admitted, a company must have at least 10 per cent of its total free-float shares available for foreign ownership, a market value of at least US$150 million and a three-month daily average trading value of minimum $1 million.

Vietjet is listed on the Hồ Chí Minh Stock Exchange as VJC. The company shares rose 0.8 per cent to trade at VNĐ132,000 ($5.67) per share on August 22.

The airline debuted on March 2, 2017 with more than 541.6 million shares. Its shares hit the highest level of VNĐ184,840 per share on April 2, 2018.

The company caps its foreign ownership limit at 30 per cent of capital and there is now a 10.77 per cent room for foreign investment.

In the first six months of 2019, Vietjet earned VNĐ26.3 trillion ($1.13 billion) in combined revenue, up 24 per cent year on year, and VNĐ2.4 trillion in pre-tax profit, up 11 per cent year on year.

According to BVSC, VNM ETF will not sell any Vietnamese stocks from its portfolio in the next review and the fund will even up Việt Nam’s country weighting from 71.63 per cent to 73-74 per cent.

To remain in VNM ETF’s portfolio, a company must have at least 5 per cent of total free-float shares available for foreign ownership and a market value of at least $75 million.

In addition, the trading value of the company shares must at least average $600,000 in each day of the last three months or minimum 200,000 shares are traded each month in the last six months.

VNM ETF is listed on the New York Stock Exchange and has invested in 27 companies across Asia, including 18 Vietnamese companies.

The fund’s top 10 investees by market value include seven Vietnamese firms, which are property firms Vingroup (VIC), Vinhomes (VHM), Vincom Retail (VRE) and Novaland (NVL), dairy producer Vinamilk (VNM), Vietcombank (VCB) and insurer Bảo Việt Holdings (BVH).

Other Vietnamese firms that have received funding from VNM ETF include consumer staple group Masan (MSN), steel maker Hòa Phát (HPG), PetroVietnam Power Corp (POW), SSI Securities (SSI), FLC Faros Construction Corp (ROS) and Sai Gon Thuong Tin Commercial Bank (STB). — VNS