Last week, Gelex confirmed to VnExpress its plan for Gelex Infra, a subsidiary in which it holds over 79% of the capital, to go public by the end of this year.
Gelex is not alone in this endeavor. Several other major players in the Vietnamese stock market are pursuing similar strategies. VPBank plans to IPO VPBankS, one of its member units, in the final months of the year. Techcombank is also taking steps to list its subsidiary, TCBS. Mobile World Group (MWG) has announced plans to list Bach Hoa Xanh in 2028, followed by its electronics retail chains, The Gioi Di Dong and Dien May Xanh, in 2030.
Nguyen Duc Tai, Chairman of MWG, explained that the group's decision to independently list its subsidiaries goes beyond simply raising capital. "This is a strategic move to enhance transparency and drive significant growth for each of MWG's business segments," he stated.
Tai emphasized that operating independently will propel each unit into a new phase of growth, benefiting the entire MWG. While chains like The Gioi Di Dong, Dien May Xanh, and Bach Hoa Xanh share operational and training similarities, their product offerings differ. Separate IPOs will allow for targeted investment in the chains with the greatest perceived potential.
A VPBank representative stated that the company aims to IPO and list VPBankS shares to increase transparency and enhance shareholder value. "We believe the vibrant stock market presents an opportune time to realize this plan," the representative added.
Many large, multi-sector corporations in Vietnam have already listed their subsidiaries. Vingroup, the largest non-financial company on the Vietnamese market, has listed several subsidiaries and affiliates, including Vinhomes, VEFAC, Vincom Retail, Vinpearl, Sach Viet Nam, and, in the US, VinFast.
Prior to Gelex Infra, Gelex had already listed subsidiaries such as Viglacera, Gelex Electric, and affiliated bank Eximbank. Masan Group, another multi-sector company, has listed Masan Consumer, Masan High-Tech Materials, Techcombank, and Vinacafe Bien Hoa. These listings have allowed these large corporations to establish ecosystems within the stock market.
Nguyen Anh Duc, Managing Director of Institutional Brokerage and Investment Advisory at SBB Securities (SBBS), explains that these corporations are likely listing subsidiaries to raise capital for expansion. Instead of further internal investment, they may be seeking external funding. IPOs also provide opportunities for companies like Mobile World, Techcombank, VPBank, and Gelex to find strategic partners for both capital and management expertise.
Duc also believes that listing will create liquidity for the subsidiaries' shares. "For instance, Bach Hoa Xanh has successfully raised capital in previous rounds, but an IPO will help them access new funding sources, while allowing existing investors to exit," he said.
In 4/2024, MWG sold 5% of Bach Hoa Xanh's capital to CDH Investment, a Chinese investment fund. At that time, Bach Hoa Xanh was valued at approximately 35,500 billion dong (about 1.4 billion USD).
Tran Quoc Toan, Branch 2 Director at Mirae Asset Securities, points to favorable market conditions as another driver for these listings. Mirae Asset's data shows that in 2018 and 2021, when the stock market thrived, capital raised through IPOs and additional share issuances reached record highs.
In 2018, the VN-Index surged 22% in just the first 4 months, surpassing 1,200 points in April. That year, nearly 150,000 billion dong was raised through IPOs and share issuances, the highest ever recorded. In 2021, with the index rising 36%, over 120,000 billion dong was raised, the second-highest in history.
Experts believe listing well-established subsidiaries with stable financials will provide investors, especially institutional and foreign ones, with more investment options. Nguyen Duc Toan states that these new listings will benefit the market.
Nguyen Anh Duc agrees, adding that these new listings are crucial for attracting foreign investment. "Some sectors, like pharmaceutical retail and convenience stores, lack listed companies. The upcoming listings of Long Chau and Bach Hoa Xanh will generate significant investor interest," he explained.
Beyond the positive market impact, Mirae Asset experts believe these listings of promising subsidiaries, the "golden geese" within their respective ecosystems, can positively influence the parent companies' valuations.
For example, Vingroup's successful listing of Vinpearl this year with a 5 billion USD valuation contributed to VIC's share price increasing by over 200% in the past 8 months. "The listings of TCBS (Techcombank), VPBankS (VPBank), and Bach Hoa Xanh (MWG) will likely lead to market revaluations of their parent companies," Toan stated.
Nguyen Anh Duc confirms that listing subsidiaries does not diminish the parent company's value but can enhance its attractiveness to investors, offering them more choices aligned with their risk appetites. He notes that conglomerates like Masan Group, Vingroup, and Gelex operate as holdings companies with complex structures, not directly involved in production but focusing on controlling stakes in their subsidiaries.
While some investors are drawn to the potential of specific business segments within these holdings, they also face risks from less successful sectors. "Listing subsidiaries separately allows for more targeted investment and more accurate valuation of the parent company," Duc concludes.
However, Anh Duc acknowledges potential risks. When a large corporation separates and lists business segments, investors might focus solely on the newly listed entities, diverting investment from the parent company.
Trong Hieu
