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First VN securities fund opens

The State Securities Commission (SSC) has given approval to the Vietnam Securities Investment Fund, the first of its kind in Viet Nam, to begin disbursing investments.

In late March, the fund, known as VF1, won a licence from the commission to set up business and offer certificates to the public.

The close-ended fund has already generated VND300 billion (US$19.1 million), its ceiling limit allowed by the SSC.

"Our investment section actually began seeking information and investment opportunities even before our certificate issuance," said Tran Thanh Tan, general director of the VietFund Management (VFM), which manages the fund’s operation.

"We had already identified a reasonably long list of investments," he said. The investment business has been receiving support from Dragon Capital and Sacombank, the two partners in VFM, and from a consultancy from the British financial company Cadagon.

Sixty per cent of the fund will be invested in companies already listed or that have the potential to be listed on the stock market.The remaining portion will go to Government bonds, the real estate market and others.

The new licence will also enable official transactions of the fund’s certificates, as it will be eligible to certify ownership transfers.

The VF1 certificate has been unofficially traded at the price of VND12,000 each, compared with the book value of VND10,000.

The fund is expecting another licence from the SSC for listing on the stock market.

Market analysts anticipate its listing may help promote trading on the market.Last week, the VN Index fell slightly by 0.36 points and closed at 261.13.

This resulted from the weakened value posted by 12 of 24 listed firms, compared with a week earlier. Six enhanced their earnings and the remaining six stayed put.

The seafood company TS4 enjoyed the biggest gain of 2.31 per cent, to reach VND17,700, while SACOM posted the smallest of 0.26 per cent, to close at VND38,800.

Telco VTC also posted a 0.26 per cent falling rate and closed the week at VND38,900. The most serious loser was the Bach Tuyet cotton company BBT, which declined 3.82 per cent to land at VND15,100.

According to the HCM City Securities Trading Centre, the Ha Long Canned Food Company (Canfoco), which is capitalised at VND35 billion ($2.22 million), has set targets for this year of VND133 billion ($8.47 million) for production value and VND7 billion ($445,000) in profits.

Last year it earned only VND3.5 billion ($223,000) from a turnover of VND120 billion ($7.64 million). It paid 6 per cent dividends for 2003.

The VND38 billion ($2.42 million) packaging company Bim Son announced it targets a VND94 billion ($5.99 million) turnover for this year that is expected to yield VND11 billion ($700,636) in gross profit.

It promises to pay 15 per cent dividends. The company plans to invest in new production facilities so that it will be able to increase its annual capacity to 60 million cement packing cases from the current 40 million.

Last year the company netted VND10.5 billion ($669,000) from a total turnover of VND76 billion ($4.84 million) and paid 15 per cent dividends.

Last week saw 3.656 million securities changing hands in both order-matching and negotiated transactions, for VND322 billion ($20.5 million).

Securities done via negotiations accounted for the overwhelming proportion of the total trading, more than 3.1 million securities worth VND308 billion ($19.61 million).

Government bonds represented most of those changing hands through negotiations.

Foreign investors bought 64,370 shares at a total cost of VND3.27 billion ($208,000) in companies, including Agifish, Gemadept, the construction stone producer Hoa An and the concrete maker BT6.

They sold almost 50,000 shares in two companies, REE and SACOM, and another 311,165 Government bonds, worth more than VND32 billion ($2.04 million) combined.

In the previous week, 3.43 million shares and bonds were traded for almost VND271 billion ($17.26 million). Of the total, deals done via negotiations accounted for 2,459 securities, and most were Government bonds, valued at VND247 billion ($15.73 million).

Foreign investors paid VND2.5 billion ($159,000) the previous week for 66,300 shares in companies, including REE, Gemadept, SACOM, BT6 and SAVIMEX.

VNS - (26/05/2004)

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