Pre-listing firm investments promise large gains

A Siam Brothers Vietnam warehouse (Source: VNA)

Hanoi (VNA) – Recent returns have shown that investments in pre-listingcompanies promise big gains for investors who make bets on the firms withimpressive business results and clear listing plans.

Speculationsin recent listings such as budget airline Vietjet (VJC) and real estatedeveloper Novaland Investment Group (NVL) have brought investors returns ofover 40 percent. Prices of these shares climbed 43-46 percent in only one totwo months of listing.

Investorswho bought shares of Vietnam National Petroleum Group (PLX) when it made theinitial public offering earned profits of nearly 230 percent.

PLXprice soared to 49,000 VND (2.16 USD) on its April 21, 2017 debut, farexceeding its IPO price of over 15,000 VND in 2011.

Thesereturn rates have outperformed the benchmark VN-Index, which has expanded justaround 8 percent this year.

Similarsuccess is expected in the coming listings of Siam Brothers Vietnam Joint StockCompany and Kido Frozen Food Joint Stock Company.

SiamBrothers Vietnam, a Thai manufacturer for rope and net used for fishing,maritime transportation and agricultural sectors, will list 20.54 millionshares with the sticker SBV on May 16 on the HCM Stock Exchange at the referenceprice of 40,000 VND a share.

The60-year-old company holds a 40 percent market share of the fishing lines. 90 percentof the Vietnamese offshore fishing fleets are using specialized ropemanufactured by Siam Brothers Vietnam.

Thecompany’s shares are trading around 45,000-48,000 VND apiece on theOver-the-Counter (OTC) market, a rise of 36.4 percent over its IPO price of 33,000VND in September 2016.

Witha high dividend rate (mostly over 40 percent in cash since 2011) and goodprofit growth (39 percent in 2016 and 15-23 percent in the next two years), itsshare prices are expected to increase when it starts trading this month.

Shareprices of Kido Frozen Food (KDF) are also increasing on the OTC market, tradingaround 58,000-60,000 VND a share, up 11.5 percent over its IPO price in Marchthis year.

KidoFrozen Food is the country’s leading ice-cream market leader with a 35-per-centmarket share in 2016. It reported after-tax profits of nearly 143 billion VND (6.2million USD) last year, a year-on-year growth of 85 percent.

The company plans to debut shares on the HCMStock Exchange in the third quarter of 2017. – VNA

VNA