The Vietnamese government needs to spend about VND 8,000 billion - 5 times the proceeds of the IPO if it wants to buy back all ACV shares

The Vietnamese government needs to spend about VND 8,000 billion - 5 times the proceeds of the IPO if it wants to buy back all ACV shares

In 2015, the average winning price of ACV in the IPO was only VND 14,300. Currently the stock market price is up to VND 80,000.

ACV: Vietnam Airport Corporation - JSC

With the aim to ensure the highest security and defense for aviation activities, the Ministry of Transport has just proposed approval of the Project on Assignment of Management, Use and Exploitation of Assets and Infrastructure. not invested and managed by the State and sent to the Government.

One of the noteworthy proposals of the Ministry of Transport is to study the roadmap for acquiring capital held by non-state shareholders at Vietnam Airport Corporation (ACV). Accordingly, ACV will become a 100% state-owned enterprise.

Currently, ACV is one of the largest enterprises in Vietnam stock market with a market capitalization of nearly 177,000 billion VND (7.6 billion USD). In particular, the state holds 95.4% of capital.

Assuming the state will repurchase investors' shares at the current market price, the current market price will be more than VND 8,100 billion - roughly 5 times the amount collected from the IPO. 2015.

In December 2015, ACV conducted a public auction of 77.8 million shares and offered a discount of 34.4 million shares to employees and trade unions. At that time, the starting price of the auction was only 11,800 VND and the average winning price was 14,300 VND / share.

With the strong growth of the aviation industry in recent years, ACV's business results have grown impressively, resulting in galloping stock prices.

When Upcom listed in November 2016, ACV market price was up to 35,000 dong, up by nearly 150% comparing to IPO price. After that, ACV has made a spectacular breakthrough to VND 120,000 / share and returned to move sideways around VND 80,000 / share for over a year.

At this price, investors holding since the IPO - including large funds such as Dragon Capital and VinaCapital - have earned a profit of 450% not to mention a small dividend received.

Ban Viet Securities Company believes that the proposal will need to be considered by the Government. In addition, even if this proposal is approved by the Government, it will take a long time to implement without the same laws or regulations for this proposal.

In addition, according to Decree 58/2012 / ND-CP, the Government will need to buy back ACV shares through a tender offer when currently holding 95.4% of the company's shares. The tender offer price will not be lower than the average trading price for 60 days prior to the tender offer registration.

ACV's profits have grown markedly since 2016 compared to the period before equitization

Who is holding shares of ACV?

ACV's 2018 annual report said that as of April 1, 2019, in addition to the state ownership, other ACV shareholders are holding more than 100 million shares in free circulation.

Most of this belongs to foreign organizations with 77.5 million shares and domestic individuals with 17.1 million shares.

A report by Dragon Capital VEIL said that by the end of 2018, the fund held about 12.1 million ACV shares with a cost of 7.2 million USD and a market value of 43.8 million USD (ACV market price). At the end of 2018, it was VND 83,800 / share.

As for VinaCapital VOF fund, ACV is the third largest investment in the fund's portfolio, with about 22 million shares held, worth nearly $ 80 million.

So these 2 funds are holding about 1/3 of the total number of ACV shares that are freely circulating.