Increasing competition forces FPTS to scale back plans

Increasing competition forces FPTS to scale back plans

The securities firm anticipates a challenging environment characterised by rising transaction fees and margin interest rates aimed at attracting customers.

A customer performs a transaction at an FPT Securities office. — Photo courtesy of the company

As competition in the Vietnamese securities market intensifies, FPT Securities (FPTS) is adjusting its business strategy for 2025. 

The firm anticipates a challenging environment characterised by rising transaction fees and margin interest rates aimed at attracting customers.

In a recent announcement, FPTS outlined its objectives for this year, which will be discussed at its annual shareholder meeting scheduled for April 1.

The company aims to achieve revenues of VNĐ1 trillion (approximately US$40 million), a slight decline of 0.6 per cent from 2024, while profit before tax is projected to reach VNĐ500 billion, down 2.47 per cent.

FPTS leaders cite several factors influencing their cautious outlook. Global economic growth is expected to remain flat at around 2.8 - 3.3 per cent, while US trade policies could further impact Việt Nam's market dynamics. 

Domestically, the Government aims for a GDP growth rate exceeding 8 per cent and a consumer price index (CPI) below 4.5 per cent. However, fluctuations in the USD/VNĐ exchange rate are anticipated to add further uncertainty.

FPTS is also preparing for the implementation of the KRX trading system, expected to launch this year. 

Despite this positive development, the company believes the market may not see the introduction of new products or many stocks listed, which could hinder growth. 

The existing competition, particularly in transaction fees and margin rates, is expected to escalate, prompting FPTS to adopt a more conservative business approach.

FPTS had previously set conservative goals for 2024 but exceeded them significantly. The company's operational revenue reached over VNĐ1.14 trillion, a 21.6 per cent increase from 2023, with profits before tax soaring over 22 per cent to VNĐ663 billion.

To enhance shareholder value, FPTS plans to distribute a cash dividend of 5 per cent for 2024, with payouts expected in the second quarter of 2025. 

The board has also proposed a capital increase through a bonus share issuance, allowing existing shareholders to receive one new share for every ten held. Additionally, nearly 10 million shares will be issued under an employee stock ownership plan (ESOP), with a vesting period of two years.

On the stock market, FPTS shares have shown resilience, closing at VNĐ51,700 on Tuesday, a 22.2 per cent increase since the start of the year. 

Bizhub