The Ho Chi Minh City Stock Exchange (HSX) has just announced Petrolimex (HSX: PLX) being named on the list of securities that are not eligible for margin trading, or non-marginable.
|Petrolimex and other high-profile names such as Hoang Anh Gia Lai, Yeah1 listed as non-marginable securities |
Generally, non-marginable securities are put in place to mitigate risks and control costs on stocks that are volatile.
The decision was made shortly after Petrolimex – the country’s largest state-owned petroleum group – published its semi-annual revised financial statement with a negative after-tax profit of VND816billion ($35.5 million).
Besides, consolidated net revenue was VND65.185 trillion ($2.83 billion), down 33 per cent on-year. Petrolimex group reported a pre-tax loss of more than VND920.4 billion ($40 million).
The COVID-19 outbreak has been a heavy cross to bear, even for large-cap firms such as Petrolimex.
The crisis transformed global oil markets in the first half of 2020, sending prices on a wild ride and spurring historic changes to energy supply chains and products used to invest in crude.
Oil started 2020 trading above $60 a barrel. The crisis-ensuing global economic shutdown slammed US crude, which fell below $0 for the first time ever in late April, according to Wall Street Journal. A landmark agreement by key oil-producing nations reached in early April to curb production has helped the turnaround.
In the second quarter of this year, global oil price picked up thanks to gradual economic re-opening, helping crude oil rise from $20.31 to $39.27 per barrel.
Notwithstanding, concerns about fresh spike in both global and domestic COVID-19 cases has led to tug-of-war between supply cuts and demand anxiety. Consequently, energy firms like Petrolimex find it a bitter pill to swallow.
According to the latest announcement from HSX, 85 companies are listed as non-marginable securities are not allowed to be purchased on margin, and must be fully funded by the investor's cash, including high-profile names such as Yeah1 Group (HSX: YEG), Hoang Anh Gia Lai JSC (HSX: HAG), Song Hong Garment JSC (HSX: MSH), and Hoang Anh Gia Lai Agricultural (HSX: HNG).