US$1b club has only one member left
19-NOV-2008 Intellasia | 17/Nov/2008 Tien Phong
Nov 19, 2008 - 7:07:00 AM
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Up to the end of last week, the "US$1 billion club" has a sole member left namely ACB of Asia Commercial Joint Stock Bank. Other members have been removed from the club due to the recession and the drastic fall of the stock market recently.
Earlier, in the start of April when the VN Index stood at over 500 point threshold, the club had four member enterprises with a total market capitalisation value of over US$1 billion (17 trillion dong) including Vietnam Milk Co (Vinamilk-coded VNM), Phu My Fertiliser Co (coded DPM), Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank-coded STB) and ACB.
Although standards to list on Ho Chi Minh Stock Exchange (STC) are considered stricter than that of Hanoi Securities Trading Centre (HaSTC), HaSTC-listed ACB always has the largest capitalisation value in the stock market. On April 1, ACB's capitalisation was nearly 25 trillion dong (over US$1.5 billion) while that of VNM-the share code with the largest capitalisation in the southern bourse, was at over 19 trillion dong.
However, at that time, the HaSTC had only ACB with the capitalisation of over 10 trillion dong while STC had seven including VNM, DPM, STB, VPL, PVD and VIC. After seven-months, the VN Index has slipped from over 500 point threshold to 352 point doorstep and the HaSTC Index is close to 100 point threshold, only ACB had the capitalisation of over US$1 billion with 19.85 trillion dong in the stock market.
At present, VNM's total market capitalisation value is at 15.1 trillion dong, DPM at nearly 16 trillion dong and STB at 12 trillion dong. Thus, the "US$1 billion club" is being reduced gradually together with the downturn of Vietnam's stock market.
Till date, the club of 10 trillion dong has five members such as ACB, DPM, VNM, STB and PVF of PVFC capitalised at 10.4 trillion dong. Enterprises listed in the "10 trillion club" such as PVD, VPL, VIC and PPC had to be kept out of the list as their shares lost in value. In addition, many firms listed in top 20 at the start of the year such as FPT, KBC, SSI and ITA lost their place in the list.
Tens of thousand of billion dong have disappeared from the stock market and the total market capitalisation value of Vietnam's both floors now has decreased from nearly US$20 billion at the end of last October to US$12.3 billion at present.
Despite the strong decline in capitalisation, according to analysts, these shares will still lead the stock market in the coming time.
In fact, enterprises listed in the top ten largest capitalised shares on the Vietnam's stock market posted good performances with high profits during the first ten months of the year. ACB gained nearly 1.4 trillion dong in profit in January-September and plans a 25% dividend in cash. VNM also posted over one trillion dong in profit during the first nine-months of the year, STB with 950 billion dong, DPM nearly 1.6 trillion dong along with others like PVD, FPT and PVF at approximately one trillion dong in 2008.
Among above firms, VIC and VPL reported modest performances by end September VIC posted 116 billion dong in profit and VPL nearly 31 billion dong. At present, VPL has a market value of 9.85 trillion dong while VIC is at 9.36 trillion dong.
Despite the gloomy stock market, many shares that were listed in the "US$1 billion club" or the club of 10 trillion dong are showing high transparency and attracting the attention of both domestic and foreign investors. ACB, VNM, DPM, STB and PVD are always in the top ten with biggest trading volume.
These enterprises are also listing the largest share volume in the stock market such as ACB with 462 million shares, DPM 380 million, STB 444 million, VNM 175 million, PPC 326 million, VIC 120 million, VPL 100 million and PVD with 110 million shares.
Investors expected the list of "US$1 billion club" and 10 trillion dong to be restored and widened soon because these share codes are considered "clinical thermometer" of the stock market and the economy as well.
At present, the total number of listed firms on both floors HaSTC and STC is 316 with the total market capitalisation value of nearly US$12.5 billion. The average Price to Earnings (P/E) ratio of listed firms fell to below 10 times and the average Price-to-Book (P/B) ratio is at only 1.8 times. Over 20 share codes are being traded at the price lower than the face value or book value.
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