Transaction volume, value soar on exchange for unlisted firms

By Hung Le   January 8, 2019 | 04:08 am PT
Transaction volume, value soar on exchange for unlisted firms
The value of transactions on UPCoM sharply rose in 2018. Photo by Reuters
The volume and value of transactions on Vietnam's unlisted exchange in 2018 rose 50 and 55 pct respectively over 2017.

Transaction figures for Unlisted Public Company Market (UPCoM) in 2018 stood at a transfer of 4.7 billion shares worth $4.04 billion.

According to the Hanoi Stock Exchange (HNX), 137 new enterprises registered and 23 de-registered from UPCoM in 2018.

By the end of the year, the total number of enterprises registered for trading on this market was 804 with a total volume of nearly 32 billion shares, equivalent to more than VND319 trillion ($13.76 billion).

The UPCoM is effectively a mezzanine exchange, set up to encourage unlisted public firms to participate in the securities market, with a view that they may later transfer onto the two main markets HNX or the Ho Chi Minh Stock Exchange (HOSE).

At 2018’s last session, the UPCoM-Index fell to 52.83 points, down 3.8 percent compared to the figure for 2017-end. This is a relatively small decline compared to the country's benchmark VN-Index, which fell 9.32 percent to 892.54 points, and the HNX-Index, which fell 10.55 percent to 104.23 points in 2018.

UPCoM’s total market cap also reached VND893 trillion ($38.5 billion) at the end of the year, up nearly 40 percent from 2017.

Although the volume of trade on UPCoM is still dwarfed by the two main markets, the volume and value of transactions on the exchange increased strongly last year.

The market saw more than 4.7 billion shares transferred, corresponding to total transaction value of over VND93.7 trillion ($4.04 billion). On average, the daily trading volume was around 19 million shares per session, up 51 percent compared to 2017, while transaction value reached over VND375 billion ($16.17 million) per session, up 55 percent over the previous year.

On this market, many stocks’ market caps exceed $1 billion now. For instance, POW shares of PV Power  has a market capitalization of over VND37.47 trillion ($1.61 billion); HVN of Vietnam Airlines over VND50.36 trillion ($2.17 billion) and BSR of Binh Son Refinery and Petrochemical JSC over VND40.93 trillion ($1.76 billion). These were also stocks that saw the most trading action from foreign investors.

In its publication, HNX noted the fact that while foreign investors were net sellers on the two main markets, they were still net buyers on UPCoM.

Overall, foreign investors traded a total of 673.1 million shares, of which VND12.2 trillion ($525.87 million) worth were bought and over VND9.6 trillion ($413.8 million) were sold.

For the whole year, the net purchase of foreign investors was VND2.6 trillion ($112.06 million) on the UPCoM market.

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