Many invested funds are now hunting for unlisted shares since those listed on official bourses and shares on UpCom market (The market for unlisted public companies) remain cold.
Vietnam Azalea Fund, an invested fund managed by Mekong Capital, recently announced the purchase of minority shares in Nam Long Investment Joint Stock Company worth $9.1 million.
Thomas Lanyi, Investment Director of Mekong Capital, revealed that the fund chose to purchase Nam Long’s shares because he discovered that Nam Long Company leaders have a long-term vision. Nam Long has big potential, with a land fund of 550 hectares stretching out from HCM City to neighbouring provinces.
Several weeks ago, a company specializing in making consumer goods presented its first product and announced its business strategy. The company immediately received invitations for cooperation from foreign and domestic investment funds. The invested funds have also suggested contributing capital.
Don Lam, General Director of the fund management company called VinaCapital, noted that, besides the real estate sector, companies are interested in investing in consumer goods production companies, as well as the healthcare sector and infrastructure, because these fields are believed to be poised for robust growth.
Le Dat Chi, MA, HCM City Economics University lecturer, observed that share prices on the OTC market have not changed much in comparison with those on official bourses, so investment funds like purchasing OTC shares. Investment funds have big capital and they find it difficult to buy shares on official bourses.
Moreover, they do not want their net asset value (NAV) to change regularly in accordance with the prices of listed shares, so they purchase shares of companies with great potential, especially those that plan to list shares on the bourse.
The investment funds think that, after the companies list shares on the bourse, they can sell the shares when the prices go up, or continue holding shares. The analysis director of a securities company explained that, in some cases, share prices do not truly reflect the value of the companies because the companies are undervalued. And this is the opportunity for investment funds.
Investment funds also surfing on investment
Recently, many investment funds purchased and sold the same volume of shares on the official bourses at the same time. On June 16, for example, the HCM City Stock Exchange informed that Asiavantage Global Limited purchased 350,000 NTL and sold 300,000 shares at the same time. Prior to that, many investment funds announced the same plan.
According to Ngo Thanh Phat, an executive of VIS Securities Company, this may be the action of surfing on investment. Phat remarked that this is a normal move, but investors should be informed about this to make their investment decisions.