Vietnamese start-ups see surge in value
STOCK prices of many Vietnamese start-up companies are valued extremely high, far above prices of large-cap shares, on the two national stock exchanges, which demonstrates investor confidence in the high-growth potential of the start-ups.
To date, the highest price for a start-up stock is more than 3.8 million dong (Bt6,075, US$172.2) for Vexere Corporation, which operates the online bus-ticket portal Vexere.com.
According to the financial information website cafef.vn, a Vietnamese investment-fund manager entrusted by a foreign fund paid more than 8.5 billion dong to buy 2,222 shares of Vexere Corp last year.
The price was even twice what the fund-management company had spent to buy shares of the bus-ticket platform in 2014. Two years earlier, this fund spent 2.1 billion dong to buy 1,112 shares of Vexere.com, equivalent to 1.9 million dong per share.
The share price of EDH Trading Development and Investment Corp, which owns 99.9 per cent of charter capital of the online education provider Topica Edtech Group, was also valued at 1.9 million dong in 2014.
Such prices are even higher than those of the highest-valued stocks on the two national stock exchanges.
Among nearly 700 codes on the Ho Chi Minh City and Hanoi stock exchanges, there are only 15 stocks being traded at more than 100,000 dong a share. They are all leading companies in their industry sectors such as dairy giant Vinamilk, Hau Giang Pharmaceutical JSC, Binh Minh Plastic JSC, VinaCafe Bien Hoa JSC and Thien Long Group Corp.
According to market insiders, Vietnam’s start-ups have high valuation because of their “micro” charter capital levels, usually between several billion and a few dozen billion dong.
EDH Trading Development and Investment Corp has a charter capital of just 2.5 billion dong, while that of Vexere is only 133 billion dong.
Besides, foreign funds have bet on start-ups that are expected to expand rapidly thanks to the country’s stable economic development and fast increase of the middle-income class.
In 2015, Japan’s CyberAgent divested a part of its investments in Foody with a price of around 300,000 dong a share, but it bought a batch of shares of the price-comparison platform Websosanh at 284,000 dong a share.
Early this year, Standard Chartered Private Equity (SCPE) spent $25 million to buy a 20-per-cent stake in M Service, the tech firm behind the electronic wallet MoMo, which was valued at $125 million.
Vietnam-based Internet company VNG Corp, known as Vietnam’s first unicorn (start-up company valued at more than $1 billion), invested nearly 383 billion dong in e-commerce platform Tiki for a 38-per-cent stake. The deal, which closed in January this year, valued Tiki at more than 1 trillion dong, a fourfold increase over 2013.
