Securities firms raise capital in anticipation of market upgrade

Securities firms raise capital in anticipation of market upgrade

Securities firms are planning massive capital hikes in 2025 as the stock market awaits positive news with long-term supporting factors.

VTG Securities JSC (VTGS), based in Ho Chi Minh City's District 1, has announced it is seeking shareholders' approval to cancel a private placement plan while seeking approval to increase its charter capital through a share offering to existing shareholders.

Photo: baodautu.vn

VTGS wants to cancel the private placement plan approved at its AGM in September 2024. The original plan was to issue 286.2 million shares to strategic investors and professional securities investors.

Instead, VTGS plans to increase its capital by offering 289.8 million shares to shareholders, which is 21 times the current number of shares, which stands at 13.8 million.

If successful, VTGS's charter capital will increase significantly from $5.52 million to more than $121 million.

The expected amount to be raised from this share offering approximates $116 million, which will be used for supplementing capital for its securities business and upgrading the company's infrastructure and facilities.

In a similar move, Hanoi-based Vietnam International Securities JSC (VISecurities) has also made plans.

At its 2025 AGM on March 14, VISecurities' shareholders approved a plan to issue up to 90 million shares to existing shareholders, raising capital by $36 million, replacing the previous plan to increase capital by $24 million.

VISecurities' current charter capital stands at $12 million. If the capital hike plan is successful, the company's charter capital will increase fourfold to $48 million.

The raised funds will be used to improve financial capacity, raise its market share in brokerage services, diversify investments, and develop infrastructure and technology services.

In February, Hanoi-based Goutai Junan Securities Vietnam JSC (IVS) successfully issued nearly 35.6 million shares to the public, raising its charter capital to nearly $42 million.

Most of the sum will be used for margin lending and developing derivative products and financial consulting services.

Large securities firms are also in the race by strengthening their capital buffers.

Vietnam Dragon Securities JSC (VDSC) plans to present to its shareholders at the 2025 AGM on April 3 a plan to issue 77 million shares to raise its charter capital in two phases.

About 24.3 million shares will be issued as dividends and 4.7 million shares under an employee stock ownership plan (ESOP). Private placements are also planned, with up to 48 million shares.

If successful, VDSC's charter capital is expected to increase from $97.2 million to $128 million, earmarked to supplement capital for margin trading, underwriting, and bond transactions.

Capital increase plans were also discussed at the 2025 AGM of FPT Securities JSC (FPTS) on April 1. According to the plan, FPTS will offer nearly 30.6 million shares to existing shareholders in the second and third quarters of this year and issue nearly 10 million shares under an ESOP scheme. The total shares expected to be issued is approximately 40.6 million.

At ACB Securities (ACBS), a capital increase plan was approved by its parent bank, ACB, at the beginning of March. ACB decided to contribute $40 million to replenish ACBS' capital sources, with the transaction expected to take place after receiving approval from the State Securities Commission.

These continuous capital increase plans demonstrate that market participants are optimistic and ready to prepare for new prospects, especially as Vietnam's stock market moves closer to its goal of being upgraded to emerging market status.

Early this month, FTSE Russell, a leading global provider of benchmarks, analytics, and data solutions with multi-asset capabilities, announced that the results of its national market classification review will be published after the US market closes on April 8.

The classification of markets in the global FTSE index basket is continuously reviewed. In this announcement, Vietnam, along with Greece, has been added to the watch list for potential upgrade consideration.

VIR