HÀ NỘI — A surge in capital-raising efforts within Việt Nam's securities sector has continued steadily, despite high valuation levels seen in recent months.

This trend, characterised by significant fundraising activities through stock issuance and initial public offerings (IPOs), highlights the ambitious strategies of various securities firms.

SSI Securities Corporation has announced plans to hold an extraordinary general meeting in 2025, primarily to discuss a rights offering for existing shareholders.

According to the proposal, SSI intends to issue over 415.5 million shares at a ratio of 5:1, allowing shareholders to purchase one additional share for every five shares they currently hold. The offering price is set at VNĐ15,000 per share, with a potential fundraising target of more than VNĐ6.2 trillion (US$236 million).

Proceeds will be allocated to margin lending and investments in bonds and other financial instruments.

The securities firm is currently conducting a private placement of more than 104 million shares, representing 5.28 per cent of the total shares outstanding, at a price of VNĐ31,300 per share. This issuance is expected to raise nearly VNĐ3.3 trillion, increasing its charter capital from VNĐ19.7 trillion to VNĐ20.8 trillion.

Meanwhile, Ho Chi Minh City Securities Corporation is also advancing its capital-raising strategy, planning to issue nearly 360 million shares to shareholders at a ratio of 2:1 with an expected price of VNĐ10,000 per share.

This move aims to raise around VNĐ3.6 trillion, increasing its charter capital from VNĐ7.2 trillion to over VNĐ10.8 trillion.

Another significant player, Tien Phong Securities Corporation, is looking to double its charter capital through a private placement worth up to VNĐ3.5 trillion, priced at VNĐ10,000 per share.

Xuan Thien Securities JSC (XTSC), formerly known as Sen Vang Securities, has set an ambitious goal of increasing its charter capital from VNĐ2 trillion to VNĐ20 trillion.

The initial phase will involve raising capital to VNĐ3 trillion by 2026 through offerings to existing shareholders and private placements, marking a substantial entry into the competitive landscape of major securities firms.

Aside from share issuances, several companies are also preparing for IPOs.

Techcom Securities (TCBS) is planning its largest IPO to date, with an expected offering of 231.15 million shares, representing 11.1 per cent of its charter capital, at a price of VNĐ46,800 per share. This IPO could potentially raise over VNĐ10.8 trillion, increasing the company’s charter capital from VNĐ20.8 trillion to VNĐ23.1 trillion, positioning TCBS as the largest securities firm by capital in the market.

 

VPBank Securities (VPBankS) is also gearing up for a widely anticipated IPO aimed at bolstering its capital base and expanding operations within the parent banking ecosystem.

While the capital-raising trend is not new, it remains strong amid high market valuations.

The recent impressive performance of the stock market has seen many securities stocks exhibit remarkable price increases, leading to heightened valuations across the sector.

The primary objective behind these capital increases is to enhance margin lending limits, as investor demand for margin loans has surged following recent market gains and optimistic prospects for the future.

For investors, the inflow of capital into securities firms may result in lower margin lending rates as companies compete more aggressively for customers.

Although the profit margins on margin lending may shrink, increased capital will enable firms to lend more, sustaining profitability growth.

Additional capital is also crucial for meeting the increasingly stringent capital adequacy ratios mandated by the State Securities Commission, and it will allow companies to expand their proprietary trading portfolios in anticipation of Việt Nam’s potential upgrade in market status, with a review by FTSE expected this month.

As securities firms with larger capital bases enhance their financial capabilities, they stand to improve their credit ratings, facilitating easier access to debt financing through bond issuance or syndicated loans from foreign institutions at more favourable rates.

However, the rapid capital increases could lead to stock dilution, putting downward pressure on share prices.

Existing shareholders should monitor issuance schedules to mitigate excessive dilution and make informed decisions, especially as the Ministry of Finance recently proposed that individuals receiving dividends or bonuses in stock will be taxed immediately rather than waiting until a sale occurs.

Generally, in a market where scale of capital is key to maintaining strength, the trend of raising capital is unlikely to slow in the short term.

As major players aggressively expand their financial capabilities, other firms will need to follow suit to avoid losing market share. — BIZHUB/VNS