Pre-listing firm investments promise large gains

A Siam Brothers Vietnam warehouse. Investment in pre-listing companies promises big gains. — Photo cafef.vn

HÀ NỘI – Recent returns have shown that investments in pre-listing companies promise big gains for investors who make bets on the firms with impressive business results and clear listing plans.

Speculations in recent listings such as budget airline Vietjet (VJC) and real estate developer Novaland Investment Group (NVL) have brought investors returns of over  四0 per cent. Prices of these shares climbed  四 三- 四 六 per cent in only one to two months of listing.

Investors who bought shares of Việt Nam National Petroleum Group (PLX) when it made the initial public offering earned profits of nearly  二 三0 per cent.

PLX price soared to VNĐ 四 九,000 (US$ 二. 一 六) on its April  二 一,  二0 一 七 debut, far exceeding its IPO price of over VNĐ 一 五,000 in  二0 一 一.

These return rates have outperformed the benchmark VN-Index, which has expanded just around  八 per cent this year.

Similar success is expected in the coming listings of Siam Brothers Việt Nam Joint Stock Company and Kido Frozen Food Joint Stock Company.

Siam Brothers Việt Nam, a Thai manufacturer for rope and net used for fishing, maritime transportation and agricultural sectors, will list  二0. 五 四 million shares with the sticker SBV on May  一 六 on the HCM Stock Exchange at the reference price of VNĐ 四0,000 a share.

The  六0-year-old company holds a  四0 per cent market share of the fishing lines.  九0 per cent of the Vietnamese offshore fishing fleets are using specialized rope manufactured by Siam Brothers Việt Nam.

The company’s shares are trading around VNĐ 四 五,000- 四 八,000 apiece on the Over-the-Counter (OTC) market, a rise of  三 六. 四 per cent over its IPO price of VNĐ 三 三,000 in September  二0 一 六.

With a high dividend rate (mostly over  四0 per cent in cash since  二0 一 一) and good profit growth ( 三 九 per cent in  二0 一 六 and  一 五- 二 三 per cent in the next two years), its share prices are expected to increase when it starts trading this month.

Share prices of Kido Frozen Food (KDF) are also increasing on the OTC market, trading around VNĐ 五 八,000- 六0,000 a share, up  一 一. 五 per cent over its IPO price in March this year.

Kido Frozen Food is the country’s leading ice-cream market leader with a  三 五-per-cent market share in  二0 一 六. It reported after-tax profits of nearly VNĐ 一 四 三 billion ($ 六. 二 million) last year, a year-on-year growth of  八 五 per cent.

The company plans to debut shares on the HCM Stock Exchange in the third quarter of  二0 一 七. – VNS