Sunday, 17 Feb 2019

HSC steps in Vinasun as major shareholder after GIC's exit

Updated at Wednesday, 06 Jun 2018, 11:44
The Hanoitimes - Ho Chi Minh City Securities Corporation (HSC) has completed the purchase of 7.2 million shares, equivalent to 10.6% charter capital in taxi firm Vinasun, according to the Ho Chi Minh Stock Exchange (HoSE).
The transaction was completed on May 25 on HoSE. 
Illustration photo.
Illustration photo.
For an average price of VND14,400 (US$0.63) apiece, HSC is reported to have spent VND104 billion (US$4.57 million) to become a major shareholder at Vinasun.

After the deal, HSC is currently the third largest shareholder at Vinasun, after Vinasun Chairman Dang Phuoc Thanh of 35% and private equity investor TAEL Partners of 18.3%. 

The deal coincided with Singapore's sovereign wealth fund GIC's decision of divesting its entire 5.4 million shareholding from the taxi firm. At a price of VND13,900 (US$0.6) per share, GIC divested its holding for VND75 billion (US$3.3 million) for less than half of its investmente, suffering a loss of around VND120 billion (US$5.28 million). 

HSC's decision to purchase Vinasun shares in the context of its shares nosediving in value. From the peak of over VND36,000 (US$1.58) at the end of 2014, Vinasun shares have lost more than 60%, moving around VND14,000 (US$0.61) each currently.

Vinasun set revenue target at VND2.1 trillion (US$92.5 million) this year, a reduction of nearly VND1 trillion (US$44 million) year-on-year.

The company's after-tax profit is expected to reach VND95 billion (US$4.2 million) in 2018, down 50% year-on-year.

This is the fourth consecutive year that Vinasun decided to lower the revenue target, due to fierce competition from ride-hailing firms such as Grab, which has acquired Uber's Southeast Asia operations.

Consequently, its after-tax profit in 2017 was VND189 billion (US$8.32 million), decreasing around 40% as compared with the figure in 2016 and at 92.3% of the year target. 

Vinasun has witnessed a sharp decline in revenue over the past years. In 2014, the figure was VND3.7 trillion (US$163 million), VND4.2 trillion (US$185 million) in 2015, VND4.5 trillion (US$198.2 million) in 2016 and of VND2.7 trillion (US$119 million) in 2017.
Nguyen Tung
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