Listed companies in good health: VAFI

Friday, May 2, 2008
A quick survey by the Viet Nam Association of Financial Investors (VAFI) showed that listed companies are operating well despite big difficulties. The association, therefore, has suggested informing investors soon about the good business performances of listed companies to calm them down.

According to Nguyen Hoang Hai, Secretary General of the Vietnam Association of Financial Investors (VAFI), the shocking monetary policy the State Bank of Vietnam has been following recently has had big influences on the stock market and businesses.

In this circumstance, speculators have spread rumours about the poor operations of businesses. The difficulties have been exaggerated to make it seem as though Vietnam was facing an economic crisis.

However, the recent survey by VAFI of some listed companies in the fields of banking, insurance, construction and real estate, transportation, rubber and pharmaceuticals showed that the companies are still maintaining the high growth rates recorded during the fourth quarter of 2007.

Construction companies are facing temporary difficulties. However, right from 2005, they all anticipated the difficulties they would face and price increases, and they all have had the plans to deal with the problems.

Hai said that in such a situation, securities investors may want to know about the ‘health’ of listed companies in the first quarter of 2008 sooner than usual. Therefore, according to him, listed companies should release their business results from the first quarter as soon as possible.

When asked if any mistakes could occur if listed companies announced business results early, Hai said that in order to avoid mistakes, listed companies could release figures equal to or lower than the actual figures. Moreover, listed companies should provide investors with reports which interpret how the inflation has affected their business performance.

Hai called the early announcement an effective measure to help recover the stock market.

Another measure Hai thinks listed companies should take is having their management boards buy more of their companies’ shares while limiting selling shares.

In fact, in the last time, some management boards of listed companies did try to buy shares of their companies, which helped calm investors down.

“The share purchase of management board members shows the responsibility of companies’ managers towards their shareholders,” Hai said. (Tien phong)