Hanoi (VNS/VNA) - Although the Unlisted Public Company Market(UPCoM) attracts less attention from investors than the Ho Chi Minh and Hanoistock exchanges, the market still offers potential opportunities for marketplayers who thoroughly understand it.

Booming scale

According to the Hanoi Stock Exchange (HNX), there are now 857 enterprisestrading on UPCoM, with a total registered trading volume of over 41.7 billionshares, corresponding to a value of over 410.7 trillion VND (17.6 billion USD).

As of the last trading day of October this year, the market capitalisation ofUPCoM stood at more than 961 trillion VND.

At the same time, there were only 367 enterprises trading on the HNX, withtotal trading volume of more than 13.04 billion VND shares, corresponding tothe trading value of nearly 130.4 trillion VND. Market capitalisation stood atmore than 186.3 trillion VND.

The number of businesses trading on UPCoM is 2.3 times higher than the HNX andmarket capitalisation is five times higher.

There are also industry-leading companies trading on UPCoM, such as theAirports Corporation of Vietnam (ACV) with a market capitalisation of nearly 170trillion VND, the Vietnam Engine And Agricultural Machinery Corporation (VEA)with more than 65.7 trillion VND, and Binh Son Refinery and Petrochemical JointStock Company (BSR) with more than 31 trillion VND.

The quality of UPCoM had improved, but the market had not received dueattention from investors, except for large enterprises, Phan Dung Khanh,director of the investment consultancy at Maybank Kim Eng Securities, toldVietnam News Agency.

According to the HNX, what concerned investors was the limited transparency ofinformation disclosure for UPCoM stocks.

At present, some UPCoM stocks are trading without matching orders for manyconsecutive days, which discourages investors from considering UPCoM as apotential market.

Opportunities

Nguyen Van Ngoc, an UPCoM investor, said the market had attracted new companiesthat could offer a lot of opportunities.

Low liquidity was UPCoM’s weakness, while UPCoM stocks were allowed tofluctuate between /- 15 percent. The figure on HOSE was only /- 7 percent andthat on HNX was /- 10 percent, he said.

“When researching a particular stock, investors need to carefully read throughcompany information and annual reports. Good fundamental stocks with strongbusiness results will definitely go up,” Ngoc said.

According to Hoang Thach Lan, head of the individual investor division at Viet DragonSecurities JSC, UPCoM was a mixture of both well-performing andunder-performing companies.

Some businesses had been delisted but retained public company status, or thosewho were not yet qualified to list on the Ho Chi Minh and Hanoi stockexchanges, Lan said.

When choosing an UPCoM stock, investors needed to track its trading process,measure liquidity and look at any abnormalities, if any, such as suddenincreases or decreases in liquidity or price.

Currently, enterprises on UPCoM were only required to publish semi-annual andannual financial statements. They should also be asked to publish quarterlyfinancial statements, Lan said./.