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Customers buying Vinamilk products in a supermarket. The company shares posted the biggest loss in market capitalisation on Friday, down over 2 per cent. — Photo vinamilk.com.vn

Shares edged lower on Friday as selling pressure persisted but falls were capped by strong performance of real estate stocks.

The market benchmark VN-Index on the Ho Chi Minh Stock Exchange (HoSE) closed the last session of the week at 1,238.71 points, down 0.68 per cent or 8.54 points.

The market breadth was still negative as 355 stocks declined while 81 stocks increased during the session. But the market’s liquidity stayed high with nearly 986.9 million shares traded on the southern bourse, worth nearly VND21.8 trillion.

Friday’s losses are expected to extend to next week, according to Saigon – Hanoi Securities JSC (SHS).

The securities firm expected that the index might struggle and fluctuate around 1,250 points in the last trading session of the week. “The close of above or under 1,250 point-level of the index can suggest the trend for next week,” SHS stated in a daily report to customers.

Bao Viet Securities Company said that the VN-Index is expected to test the support territory of 1,225 – 1,232 points again in the next sessions.

Selling pressure weighed on almost every sector, especially materials, banking, utilities and transportation sectors.

The VN30-Index lost 0.57 per cent, or 7.33 points, to finish Friday’s trade at 1,276.87 points. Twenty-one of the 30 biggest stocks in the VN30 basket fell while only seven rose.

Vietnam Dairy Products JSC (Vinamilk, VNM) posted the biggest loss in market capitalisation, down 2.22 per cent. Followed by Vietnam Rubber Group JSC (GVR) and Vietcombank (VCB), down 4.32 per cent and 1.23 per cent, respectively.

Big stocks like JSC Bank For Investment and Development of Vietnam (BID), VPBank (VPB), Techcombank (TCB), Saigon Beer – Alcohol – Beverage Corporation (SAB), Vietjet Aviation Joint Stock Company (VJC) all lost more than 1 per cent.

However, gains in real estate and construction stocks limited the losses. Of which Vingroup JSC (VIC) still led the rally, up 1.49 per cent on Friday. Other stocks like No Va Land Investment Group Corporation (NVL) and Investment And Industrial Development Corporation (BCM) also rose more than 5 per cent.

On the Ha Noi Stock Exchange, the HNX-Index slid by 1.02 per cent to 293.11 points due to falls in large-cap stocks. The HNX30-Index, tracking the 30 biggest stocks in HNX, declined 0.76 per cent to 440.43 points.

During the last session, domestic investors poured over VND3.8 trillion into the market, equivalent to a trading volume of over 225 million shares.

On the contrary, foreign investors were still net sellers in the market with a total value of VND535.27 billion. Accordingly, they net sold a value of VND560.83 billion on HoSE and a value of VND3.48 billion on UPCOM, while net buying a value of VND29.04 billion on HNX. — VNS

SOEs must complete the sale of shares within four months, photo Le Toan

State-owned lender Agribank has been stuck for years with divestment efforts because its real estate assets could not be approved by the Ministry of Finance due to their large size and complex procedures.

“At the end of last year, the Ministry of Finance also made a comprehensive assessment on the equitisation goal of state-owned enterprises. Specifically, only about 28 per cent of enterprises were equitised, which means that nearly three-quarters did not meet the plan. The main issue is that many large corporations’ land use rights remain unclear, as can be seen in the cases of VNPT and Agribank,” explained Chu Manh Hung, deputy head of the Equitisation Department at Agribank.

“Since the equitisation plan during 2016-2020 has not been completed yet, Agribank will continue carrying out this task for the 2021-2025 period,” he added. “However, there are still major roadblocks hampering the process, associated with determining the value of land and affiliated enterprises.”

While Agribank has been constantly pushing the equitisation process, the complex valuation procedures have been a major obstacle slowing down progress. The bank also has to cope with the myriad challenges arising from its large number of affiliated enterprises, multi-level authorisations required, as well as delayed approval of land use schemes.

Agribank has a total of around 294 real estate properties with a total area of 2.6 million square metres, with diverse origins and incomplete legal documents. While these assets can help the bank’s equitisation value reach record levels and enhance its efficiency, they have also delayed divestment for years.

“Agribank currently has more than 100 land plots with unclear legal status. We hope to receive support from relevant units and agencies to quickly equitise this large volume of assets,” Hung told VIR.

Despite its ongoing equitisation, Agribank jumped 17 spots to rank 173rd in the recently-announced Brand Finance Banking 500 list for 2021, which featured the most valuable and strongest banking brands in the world.

As of December 31, Agribank’s total assets reached nearly VND1.57 quadrillion ($68.26 billion), with its capital exceeding VND1.45 quadrillion ($63 billion). According to Brand Finance, as governments scramble to stimulate economic growth in the face of the ongoing global health crisis, and profits and interest rates taking a hit, nearly two-thirds of the world’s 500 most valuable banking brands have recorded brand value losses.

As per Decree No.01/2014/ND-CP released in 2014 on foreign investors’ purchase of shares of Vietnamese credit institutions, a foreign strategic investor shall not hold more than 20 per cent of the charter capital of a Vietnamese credit institution. Foreign investors shall not hold more than 30 per cent of the charter capital of a Vietnamese commercial bank.

Besides Agribank, other local lenders have been enjoying the attentions of foreign partners looking to increase their footprint in Vietnam.

In 2019, a strategic co-operation between Vietnamese bank BIDV and South Korean KEB Hana Bank turned the former into the lender with the largest market capitalisation in Vietnam with around $1.73 billion. KEB Hana invested capital in exchange for a 15 per cent stake in BIDV, while BIDV received long-term technical assistance from the South Korean lender and its parent company, Hana Financial Group. The tie-up also quenched the bank’s thirst for capital as BIDV announced it has now satisfied Basel II requirements.

Elsewhere, Singapore’s sovereign wealth fund GIC in 2019 purchased over 94 million new shares and now owns a 2.55 per cent stake in Vietcombank. Mizuho, one of the largest Japanese financial services providers purchased an additional 16.6 million new shares to maintain its existing 15 per cent stake in the bank.

“The equity investment by GIC and Mizuho increases Vietcombank’s charter capital and creates a solid capital buffer for the bank to meet capital requirements under Basel II Accord as well as maintain its leading position in the Vietnamese banking sector,” a GIC representative stated.

Last year, the International Finance Corporation (IFC), a member of the World Bank Group reduced its stake in VietinBank by 1.5 per cent, following an earlier divestment.

The IFC and equity subsidiary IFC Capitalization Fund also reduced their combined ownership in VietinBank from almost 6.49 to 4.99 per cent last year, leaving more room for other foreigners.

Besides the IFC, Japanese financial institution Bank of Tokyo-Mitsubishi UFJ holds 19.73 per cent in the state-run bank. However, VietinBank has not signalled any new potential partnerships since IFC pulled out.

On the other hand, under Vietnamese regulations, state-owned enterprises (SOEs) must complete the sale of shares within four months of having their equitisation plans approved. This time limit may not be enough for overseas investors to conduct due diligence and negotiate representations and warranties, special rights, and other conditions for share acquisitions with the authority representing state capital in the SOE, according to ASCV Legal.

Illustrative image (Source: VNA)

Hai Phong (VNA) – The northern port city of Hai Phong targets 1.5 billion USD in foreign direct investment (FDI) in the second quarter of 2021, according to head of the Management Board of Hai Phong Economic Zones Le Trung Kien.

Kien said that the city will increase dialogues to explore obstacles facing businesses, while enhancing efficiency of investment promotion activities, while prioritising investors with high capacity and advanced, environmentally-friendly technologies .

Along with speeding up administrative reforms, the board will coordinate closely with the local police force to ensure order and security in economic zones and industrial parks, creating a safe environment for enterprises, Kien said.

He said Hai Phong currently has 12 industrial parks. As of March 31, 2021, the local industrial parks and economic zones had lured 406 FDI projects worth 17.15 billion USD.

The average occupancy rate in the local industrial park has reached 62.5 percent. There are 154,100 labourers working in Hai Phong’s industrial parks and economic zones.

In the 2021-2025 period, Hai Phong plans to construct 15 new industrial parks with a total area of over 6,200 hectares.

Last year, the city ranked seventh out of 63 provinces and cities nationwide in the Provincial Competitiveness Index (PCI), and second out of 11 provinces and cities in the Red River Delta region./.

The Mekong Delta, which has 13 administrative units, including a centrally-run city (Can Tho) and 12 provinces, covers 40,547.2km² and has a total population of over 17.2 million people, accounting for 13 percent of Vietnam’s area and nearly 18 percent of the country’s population, the General Statistics Office of Vietnam reported in 2019.

According to the Planning Department under the Ministry of Agriculture and Rural Development, the delta accounts for about 40 percent of Vietnam’s total value of agricultural production. The corresponding proportions of rice, fisheries, and fruit output are 50, 65 and 70 percent.

The region also makes up 90 percent of the country’s total rice exports.

The 152 MW wind farm that Trung Nam Group finished yesterday in Ninh Thuan’ Province is the largest in Viet Nam. — Photo courtesy of Trung Nam

Trung Nam Group inaugurated the last phase of its wind farm yesterday in the central province of Ninh Thuan’s Thuan Bac district, making the 152 MW farm the largest in Viet Nam.

The finished wind farm worth VND4 trillion (US$172.4 million) would produce 423 million kWh of electricity per year. Combined with the solar power plant of 204 MW, which was expected to produce 577 million kWh electricity per year in the same province, the group ran the largest renewable energy of solar and wind power complex in the country and Southeast Asia, said Trung Nam Group.

Nguyen Tam Tien, general director of the Trung Nam Group said: “The event marks an important turning point for the group in its sustainable energy development orientation.”

Tien said Trung Nam’s 900 ha renewable energy complex was directly connected to the national grid system through Thap Cham 220 kV transformer station. The total annual output of the complex was expected to reach between 950 million kWh and 1 billion kWh of electricity per year.

Tien said: “Different from developing solar power projects, developing wind power projects is more complicated due to large investment costs, more time for transport and installation of equipment, especially in the more difficult context of the COVID-19 pandemic.”

He said with the experience of a leading energy group, Trung Nam Group has overcome those challenges and completed the third phase of the project.

In the construction, the group collaborated with world leading qualified and professional partners such as Enercon and Sany.

In detail, the project’s turbines supplied by Enercon company from Germany could operate with low wind speeds of 2 -2.5m per second and the ability to catch the wind with an average speed of 7.1 m per second. They are the turbines with the largest capacity in the country so far.

Trung Nam said using the advanced equipment, they could reduce the ​​land occupied to only 0.14 ha per MW, lower than the average land use rate of 0.35 ha per MW for other wind farms, significantly contributing to the efficient use of national resources in Viet Nam.

Along with the wind farm, so far, the group has put into operation two solar power projects in Ninh Thuan Province and Tra Vinh Province with a total capacity of over 360MW. Last year, Trung Nam Group became the first private investor in Viet Nam to build and run the transformer station, a 220 / 500KV transmission line and a 450 MW solar power plant successfully.

According to Trung Nam’s leader, the group was actively implementing plans to bring 900 onshore, offshore and offshore wind pillars to projects in localities such as Dak Lak, Gia Lai, Tra Vinh and Ninh Thuan. Implementing other energy projects in Viet Nam, it targeted to bring 10GW to the national grid by 2027. — VNS

Developers and authorities discuss the HCM City region property market at a workshop in the city yesterday (April 16). — VNS Photo Thu Hang

The skewed concentration of property projects in some areas of HCM City has resulted in an imbalance in the development of satellite cities and causes a strain on the transport system, a workshop heard in the city yesterday.

In 2017 the Government approved a master plan for the period until 2030 for the HCM City region, which covers an area of more than 30,000 square metres comprising HCM City and the seven surrounding provinces of Ba Ria – Vung Tau, Binh Duong, Binh Phuoc, Tay Ninh, Long An, Dong Nai, and Tien Giang.

It creates a legal framework to attract investment in satellite cities and real estate markets in outlying areas, Nguyen Tuan Anh, editor-in-chief of Nha dau tu (Investor) magazine, told the workshop.

New regulations in the city to tighten the issue of licences to property projects resulted in a drastic drop in supply, boosting the real estate markets in neighbouring provinces, he said.

But there is an imbalance in the development of satellite cities, affecting the implementation of the master plan, he said.

Le Do Muoi, head of the Transport Development and Strategy Institute, said investment in traffic infrastructure is vital to ensure connectivity between HCM City and satellite cities and synchronised transportation.

Improving traffic infrastructure is now a priority, he said.

In recent years infrastructure for travel between the city and provinces in the HCM City region has improved, resulting in the mushrooming of new urban areas, he said.

This has enabled investments to flow easier into neighbouring provinces, he said.

But a high concentration of property and urban development projects to the east of the city, including in Binh Duong and Dong Nai provinces, has resulted in skewed development and placed a strain on transport systems in its gateways.

Nguyen Hoang, R&D director at DKRA Vietnam, said the HCM City real estate market has for years spilt over into its neighbouring provinces, and their markets thus have close links and affect each other.

Last year the market in neighbouring provinces saw positive growth, which made up for the decline in all segments in HCM City, he added. — VNS