SSI pushes for FIE listings to bridge market gap

SSI pushes for FIE listings to bridge market gap

Internationally funded companies account for more than three-quarters of Vietnam's export turnover but represent only around 0.15 per cent of the stock market's value, a gap that could be narrowed by encouraging more listings.

Nguyen Duc Thong, CEO of SSI

At a seminar in Hanoi on September 17 titled 'A Listing Roadmap for FIEs in Vietnam', SSI CEO Nguyen Duc Thong said the presence of foreign-invested enterprises (FIEs) in Vietnam's capital market remains disproportionate to their role in the economy. The event was organised by SSI Corporation.

"FIEs disbursed around $27.6 billion in Vietnam last year and generated more than three-quarters of the country's export turnover," Thong said. "After around three decades of development, foreign investment has become an important component of Vietnam's economy."

"The picture on the stock market, however, is quite different," he added. Vietnam currently has more than 1,600 listed companies and enterprises registered for trading, along with more than 12 million investors, while the market is worth around $350 billion. Yet, only 10 FIEs are present on the market, representing approximately 0.15 per cent of its total value.

Another gap highlighted by the SSI CEO is the lack of new FIEs in recent years. Since 2017, the Vietnamese stock market has not recorded any new FIE listing.

"In practice, a stock market listing is more than simply a means of raising capital and can become a milestone in a company’s development strategy," he said. Becoming a public company entails higher requirements for corporate governance and information transparency, while also helping businesses build credibility with customers, partners, and investors. Companies can also gain greater access to long-term domestic capital to support business expansion.

"For FIEs, participating in the stock market can also demonstrate their long-term commitment to the Vietnamese market," Thong said. "The timing is now more favourable as Vietnam’s capital market enters a new phase of development, supported by legal reforms, new trading infrastructure, and the country’s transition from frontier to emerging-market status."

Explaining the need to encourage greater participation by FIEs, Thong said Vietnam’s capital market is entering a new phase. Legal reforms, new trading infrastructure, and the transition from a frontier to an emerging market are bringing leading international investors to Vietnam. These investors are looking for high-quality issuers with strong governance and solid business operations.

“With changes to the Law on Securities and its guiding decrees last year, there is now a clear legal framework for enterprises to pursue a listing,” he said.

SSI, for its part, has committed to accompanying FIEs throughout the process, from initial public offering preparation, strategy development, and restructuring to investor engagement and the post-listing period.

"We aim to become a long-term partner for the international business community in Vietnam, as well as for the investors who own these companies," Thong added.

Greater participation by FIEs in the public market would expand investment choices, add depth and quality to the stock market, and strengthen connections between Vietnam's capital market and international capital flows.

Given the significant contribution of FIEs to Vietnam's exports but their limited presence on the stock market, Thong expressed hope that discussions among regulators, businesses, and financial institutions would give the foreign investor community additional information to consider participating in Vietnam's capital market.

VIR