VN beats Singapore to top ASEAN’s IPO markets

Singapore, who lost its crown to Viet Nam, retreated to fourth position this year with total IPO value of just $500 million. Thailand ranked second with total proceeds of $2.5 billion and Indonesia was in the third place with $1.2 billion, data from global consultant firm Ernst and Young (EY) showed.

Viet Nam’s rise was attributed to large IPO deals in the country as its Government pushed ahead with equitisation of big State-owned corporations.

The five biggest IPOs of State-owned enterprises have raised more than VND19.2 trillion ($821 million). They included PetroVietnam Power Coporation (PV Power), Binh Son Refining and Petrochemical Corp JSC (BSR), PetroVietnam Oil Corp (PV Oil), Viet Nam Rubber Group (VRG) and Viet Nam Southern Food Corp (Vinafood II).

The IPO of PV Power was the biggest deal with proceeds of almost VND7 trillion; followed by BSR with VND5.57 trillion and PV Oil with VND4.2 trillion. VRG and Vinafood II each earned the Vietnamese Government over VND1 trillion for their IPOs.

The biggest deal, however, belonged to a private company – the $1.35 billion IPO by Vinhomes, a real estate arm of Vingroup. This is also the largest ever in Viet Nam and Southeast Asia’s second biggest deal in 2018.

Viet Nam’s rise is among few performers which saw growth in IPO activities. About 1,359 IPOs were carried out globally, down 21 per cent year-on-year, but total proceeds rose 6 per cent to $204.8 billion thanks to mega deals such as the $21.1 billion IPO by Japanese SoftBank, $7.5 billion IPO by China Tower and $5.4 billion IPO by China’s mobile phone company Xiaomi.

In Southeast Asia, besides Viet Nam, only Indonesia has had a busy IPO market with yearly growth of 66 per cent while the rest of the region, including major financial hub Singapore, witnessed declines.

According to experts, global trade wars, political tensions and volatile markets in the second half of this year have had an adverse impact on businesses, causing some delays in their listing schedules.

In the next three years, with more State-owned enterprises being equitised, Viet Nam is expected to remain at the top of Southeast Asia’s IPO league, according to a report from Baker McKenzie and Oxford Economics compiled by CNBC.

Big IPOs expected in 2019 will include Mobifone, Viet Nam Posts and Telecommunications Group (VNPT), EVNGenco 1 and 2 and Agribank. 

Projections for Southeast Asia IPO proceeds (billion USD)

Source: Baker McKenzie, Oxford Economics