Summary about Vietnam securities market and securi- 123docz.net

Vietnam securities market official has officially operated since 2000, when Ho Chi Minh Securities Trading Center - HOSTC (now changed to Ho Chi Minh Securities Exchange – HOSE) was established on July 2000. At that time, there were only few stocks traded with total capital about USD 1.7 million. Through first 6 years, market capitalization only reached USD 0.5 billion. In two year 2006 and 2007, Vietnam securities market has developed significantly with series of impressive records. Market capitalization in Dec 2006 was estimated USD 13.8 billion, account for 22.7% GDP. This number in April 2007 reached USD 24.4 billion, approximately 38% GDP, increased 1400 times comparing to the year 2000. Currently, the number of listed companies is 213 companies, increase 704%

comparing to 2000.

Figure 2-1: Chart of VN Index from 2001 to 2007

Source: http://vndirect.com.vn

The above chart describes the performance of VN Index in 8 years from 2000 to 2007. If in the first session on 28 July 2000, VN Index only got 100 points, then in March 2007, it reached the peak of 1170 points. It‟s obvious that the market has grew tremendously in 2006 and 2007. In 2006 only, VN Index grew 146%, while in

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the first three months this year, the Index made another 43% growth. Currently, VN Index fluctuates around 900 point, 90 times higher from the beginning day of trading.

Up to date there are 60 securities companies operating in the market. There are 60 securities companies trading in Ho Chi Minh Securities Exchange (HOSE) and 55 securities companies trading in Ha Noi Securities Trading Center (HASTC). These companies operate in four main areas including (1) deposit and brokerage, (2) consultancy, (3) self-trading and (4) under writing.

The total trading account have increased from 50,100 accounts in 2005 to 106,393 in 2006 and up to Sep 2007 is about 320,000 account, increase 300% against 2006, in which there are more 140,000 new account were open in first 6 months of 2007.

The chart below describes the percentage of accounts that were opened at different securities companies. The leader currently is Sai Gon Securities Incorporation (SSI) with 21.20%, the second is Vietcombank Securities Company (VCBS), the third position belongs to Bao Viet Securities Company. The other big players are Securities Company of Asia Commercial Joint Stock Bank (ACBS), Securities Company of BIDV (BSC), and Securities Company of Agribank (AGRISECO) and Incombank (IBS). The others securities companies only account for 20.90% of the total accounts. These statistics show that the brand names of experienced and big securities companies help them attract a lot of customers. It‟s rather difficult for new-born securities companies to compete with the existing players if they don‟t have marketing policies that suit their status and affect the awareness of investors.

Figure 2-1: Percentage of Accounts Opened at Securities Companies

Percentage of Accounts opened at Securities Companies

21.10%

15.20%

12.40%

10.20%

9.40%

6.50%

4.30%

20.90% SSI

VCBS BVSC ACBS BSC AGRISECO IBS

OTHERS

Source: Statistics of State Securities Committee in Sep 2007

Base on company size, market share, time of establishment and fame, securities companies in Vietnam can be divided into three groups.

Group 1 includes big and well-known securities companies which keep the big market share, at least 5% of total market share. Besides, these companies have been established and operated in the market for a long time, at least two years. Several companies in this group are:

Sai Gon Securities Incorporation (SSI) Vietcombank Securities Company (VCBS) Bao Viet Securities Company (BVSC) ACB Securities Company

BIDV Securities Company (BSC)

Agribank Scurities Companies pany (Agriseco)

…

Group 2 consists of medium companies. These companies are established after the first group for about 6 -12 months and have a relatively well-known market position. One common feature of companies in this group is that they are normally a member or closely related to big financial institutions, big banks, big corporation.

Therefore, they are supported in terms of capital, human resource and customer relationship. Some companies in Group 2 are:

Thang Long Securities Company

Sai Gon Thuong tin Bank Securities Company An Binh Bank Securities Company

VnDirect Securities Company Trang An Securities Companies

…

Group 3 is companies opened recently, smaller size and less accounts. They are joint stock companies that established by rich individuals who take advantage the development of securities market.

Dai Viet Securities Company Bien Viet Securities Company Tan Viet Securities Company Viet Tin Securities Company Viet Dragon Securities Company

Summary about Vietnam securities market and securities companies

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