The IPO deal of Ton Dong A Corporation was among the most notable in the first half of 2022. — Photo courtesy of Ton Dong A Corporation

In the first half of the year, the capital market had six successful IPOs, raising $65 million, building on the vibrant market movements in the second half of 2021.

During this period, the Vietnamese market witnessed two IPO deals that managed to raise more than $20 million each from Ton Dong A Corporation and Nova Consumer.

The slowing down of momentum in the year's second half was attributable to global inflation uncertainties and the increasing likelihood of a recession.

Escalating fuel prices, rising interest rates, tightening capital markets and recent financial scandals drive Viet Nam's trend.

The IPO market focus has shifted from Real Estate in 2021 to Industrial and Consumer Products in 2022. It is expected that Consumer Products will continue to play a key role, with highly anticipated upcoming IPOs from this sector.

Viet Nam’s economy is projected to grow by 6.5 per cent in 2023. Slower growth stems from uncertainties in the global economic environment and dependency on overseas partners for manufacturing activities.

A strong pipeline of companies is waiting to go public, subject to better market conditions. The report states that regulatory changes are expected to boost investor confidence and stabilise the economy in the long run, which will translate into a more active stock market.

“The IPO market focus has shifted from Real Estate in 2021 to Industrial Products and Consumer Business in 2022. It is expected that Consumer Business will continue to play a key role, with highly anticipated upcoming listings from this sector.

With current uncertainties, investors and companies are proceeding rather cautiously to time the market,” said Bui Van Trinh, Disruptive Events Advisory Deputy Leader, Deloitte Vietnam.

“Viet Nam regulatory bodies have launched several initiatives to promote the transparency of financial information by introducing regulations that encourage a transparent, efficient and respected listing process and promoting the adoption of International Financial Reporting Standards (IFRS). We hope that this will boost local and international investors’ confidence and enhance the attractiveness and vibrancy of Viet Nam capital market.”

SEA performance

IPO Capital markets across Southeast Asia produced 163 IPOs, raising US$7.6 billion in funds and US$56.1 billion in market capitalisation in 2022.

The Southeast Asian IPO market closed in 2022 with a market capitalisation of US$56.1 billion. Although funds raised had decreased by 43 per cent, market capitalisation increased by 10.3 per cent from 2021.

Thailand and Indonesia are top of the table in Southeast Asia for 2022; each raised above US$2 billion, collectively accounting for 78 per cent of total funds raised across Southeast Asia. Malaysia witnessed a 138 per cent increase in IPO funds raised.

Last year was one of global uncertainty in the economy and financial markets. The report said consecutive federal rate hikes to battle rising global inflation and the Russia-Ukraine conflict contributed to a supply chain crunch and upward pressure on prices. VNS