Top 5 Stock Market Highlights of 2005

At Ho Chi Minh City Securities Trading Center.

The year 2005 witnesses many happenings on the stock market of Viet Nam. According to the great majority of investors, these five events are considered the most significant highlights.

1. Stock prices increased remarkably.

2005 was the bumper year for share purchasers when both listed and unlisted companies’ shares increase highly in price. Investors earned much benefit when the VN-Index in late 2005 rose by 30% and many joint-stock companies enlarged their dividends and offered bonus shares to purchasers.

2. Speed-up in equalization strongly moved the stock market.

Besides minor auctions of less than VND10 billion at many stock companies, over 50 big companies were officially auctioned at the securities trading centers in Ha Noi and Ho Chi Minh City.

Two corporations including Viet Nam Dairy Products Corp. (Vinamilk) and Kinh Do Construction and Food Processing Company have drawn much interest from investors. In 2006, the equitization and auction of companies will be continually carried out with the participation of some giants, among which are the mobile phone network operator Mobifone and Vietcombank, one of four leading State-owned commercial banks.

3. Foreign investors were allowed higher cap.

The Prime Minister on June 14 approved the plan to increase foreign investment limits on listed firms and mutual funds to 49% from earlier 30%, which helped the foreign investors to have higher stakes by over VND200 billion in several listed companies as well as investment funds in the last two months of 2005.

To take advantage of this, the foreign investment funds in Viet Nam said they will mobilize more capital in the first quarter of 2006.

Besides, the State Securities Commission also created more opportunities to foreign investors as defining again their role. Accordingly, all joint-ventures and 100% foreign owned corporations will be considered foreign investors, except the insurance companies’ investment funds.

4. Ha Noi Securities Trading Centre (HNSTC) opened.

On March 8 the HNSTC officially opened with a major share auction. On July 14 it opened the secondary trading floor for joint-stock companies. Nine enterprises have so far listed with shares worth around VND1.5 trillion (US$95 million) in terms of face value.

5. Sacombank’s bonds went public.

The Sai Gon Thuong Tin Bank (Sacombank) was the first bank to receive the State Bank’s approval to offer its bonds to the public after having been waiting for five years.

With the current auction of the giant Vinamilk and the equitization in the banking industry, for example the Vietcombank in near future, Viet Nam’s stock market in 2006 is expected to be improved, both in the scale and the quality.

By: D.D – Translated by: Trong Khuong

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