VietJet seeks first overseas listing by Vietnamese firm

Ms Nguyen Thi Phuong Thao said VietJet hopes to become the first Vietnamese company to list shares overseas. Its shares rose 0.8 per cent at the close in Ho Chi Minh City, the biggest gain in more than two weeks.
Ms Nguyen Thi Phuong Thao said VietJet hopes to become the first Vietnamese company to list shares overseas. Its shares rose 0.8 per cent at the close in Ho Chi Minh City, the biggest gain in more than two weeks.PHOTO: BLOOMBERG

Carrier seeks billions for new planes; approached by London, HK and S'pore stock exchanges

HANOI • VietJet Aviation Joint Stock is in talks to become the first company in Vietnam to list its shares on a stock exchange overseas as the carrier, which controls more than 40 per cent of the domestic airline market, seeks more funds after plans for billions of dollars in aircraft purchases.

"We've been approached by some foreign stock exchanges including London, Hong Kong and Singapore, which expressed their interest in our stock," said VietJet's founder and chief executive officer Nguyen Thi Phuong Thao in an interview on Sunday. She will meet exchange officials in New York later this week.

The plan for the 41 trillion-dong (S$2.5 billion) low-cost carrier comes amid the government's easing of rules to allow more foreign investment in one of the fastest-growing aviation markets.

VietJet received shareholder approval last month to boost its foreign ownership limit from 30 per cent to 49 per cent.

"Listing overseas in big markets will help increase our access to more fund sources, boost the trading of our stock and expand the list of our investors," said Ms Thao, a self-made billionaire.

"We don't want to hide our hope to become the first Vietnamese company to list shares overseas."

Shares of VietJet rose 0.8 per cent to 127,800 dong at the close in Ho Chi Minh City, the biggest gain in more than two weeks. The stock has surged about 51 per cent since it started trading three months ago.

MANY BENEFITS

Listing overseas on big markets will help increase our access to more fund sources, boost the trading of our stock and expand the list of our investors.''

MS NGUYEN THI PHUONG THAO, founder and CEO of VietJet, on why the carrier wants to list shares on a stock exchange overseas.

The overseas listing plan would make VietJet the first Vietnamese company to officially trade overseas, said Ho Chi Minh City Stock Exchange deputy chief executive Tran Anh Dao.

While VietJet has done well in Vietnam, it faces tougher competition against entrenched players such as low-cost carrier AirAsia, as well as Cathay Pacific's regional unit, Cathay Dragon, as it expands in Asia, said Mr Tyler Cheung, director of institutional clients at ACB Securities in Ho Chi Minh City.

"They have been able to accomplish something impressive in a relatively small period of time," he said.

"The question is whether their business model and corporate strategy can transfer to a regional play."

Hong Kong Exchanges and Clearing does not comment on individual companies, said a spokesman. Singapore Exchange declined to comment.

VietJet, which began operating six years ago, has 136 foreign investors who own 26 per cent of the company, Ms Thao, 46, said last month.  She owns more than 60 per cent of the airline directly as well as through holding companies and other entities, according to filings.

The increase in foreign ownership will need to be approved by Prime Minister Nguyen Xuan Phuc as aviation is considered a restricted industry, with the limit currently capped at 30 per cent. The airline has filed paperwork requesting the increase, Ms Thao said.

BLOOMBERG

A version of this article appeared in the print edition of The Straits Times on May 30, 2017, with the headline 'VietJet seeks first overseas listing by Vietnamese firm'. Print Edition | Subscribe