Delisted firms queue up to return

Viet Nam’s shrimp king, Minh Phu Seafood Corporation (MPC) will start trading on UPCoM on October 16 at the reference price of VND79,000 (US$3.48) per share, lower than its closing price of VND122,000 on March 30, 2015 when it stopped listing on the HCM Stock Exchange. – Photo cafef.vn

The seafood firm voluntarily canceled the listing for the purpose of issuing additional shares to strategic shareholders. At that time, the company’s chairman, Le Van Quang, said MPC’s prices did not reflect the real value of the company and it was finding it difficult to sell shares to strategic partners at good prices.

However, the delisting did not help in raising more capital and its business went down, incurring a loss of VND7 billion in 2015. It rebounded with profits of VND82 billion in 2016 on revenues of nearly VND12.1 trillion.

The company’s return to the stock market is part of an ambitious business plan. It has targeted consolidated revenues of VND15.8 trillion and net profit of VND841 billion in 2017, a 10-fold increase over the previous year. It has earned first-half profits of VND159 billion.

Minh Phu is one of the two biggest seafood exporters in Viet Nam. Its total export turnover reached over $530 billion in 2016, with the United States being the major importer ($220 million), followed by Japan with $109 million.

Previously, cement manufacturer Beton 6 Corporation (BT6) also returned to the market after two years and started trading shares on UPCoM on March 6 at the reference price of VND9,000 per share.

Beton had also quit the market of its own accord for restructuring the company. However, its performance has not improved since, with et profit declining 68 per cent year-on-year to around VND8.7 billion in 2016.

Its shares traded at below VND5,000 a share yesterday.

The Tien Tien Plastic Packaging JSC (TTP) had left the stock market in October 2015 at the closing price of VND53,000 per share.

After delisting, the company went through an overhauling with the Dongwon Systems Corporation increasing its holdings to 88.16 per cent in 2016, becoming the parent company.

It seems to have turned a corner since, earning net profits of VND60 billion in 2015 and VND105.5 billion last year. It also began trading on UPCoM in March at VND47,000 per share. However, because Dongwon Systems holds most of its stakes, very little trading happens.

The Mekophar Chemical Pharmaceutical JSC (MKP) is another firm that plans to list on the stock market this year, five years after delisting. The company used to be a favoured stock, paying high cash dividends of 25-30 per year.

The reason Mekophar gave when it quit the market in 2012 was that it was going to implement a business expansion plan. It registered to expand wholesaling and retailing of pharmaceutical products, but, as a principle, foreign-invested firms are not allowed to engage in this business. Mekophar had a 4.47 per cent stake held by foreign investors at that time and it decided to cancel its listing.

From 2014-2016 it did well with net profits crossing VND100 billion every year. Its charter capital increased to VND194 billion last year.

More companies are expected to return to listing in the near future, with Circular 180/2015/TT-BTC stipulating that public companies, including those that cancelled their listing before the effective date of the circular, January 1, 2016, must register for trading on UPCoM.