HSC Securities approved capital increase plan exceeding 10,000 billion

HSC Securities has just officially approved a plan to increase capital by offering nearly 360 million shares, thereby increasing charter capital by nearly VND3,600 billion.

HSC aims for a capitalization of billions of dollars - Photo: HSC

Ho Chi Minh City Securities Corporation (HSC) has just held an extraordinary shareholders' meeting in 2024 this afternoon, December 4, in an online format, focusing solely on the plan to issue shares to existing shareholders to raise capital.

Have confidence when supported by state shareholders

The congress unanimously approved the plan to issue HSC shares to existing shareholders. Specifically, the securities company plans to offer nearly 360 million shares, thereby increasing its charter capital by nearly VND3,600 billion. After the above deal is completed, the company is expected to increase its total capital to VND10,800 billion, enhancing its position.

Notably, during the COVID-19 pandemic, when the stock market boomed, HSC was the first securities company to plan to increase capital, hoping to "skip ahead" of investor trends. However, this process was delayed for two years, because the state shareholder - HFIC (Ho Chi Minh City State Financial Investment Company) had to wait for approval from competent state agencies.

In the middle of this year, this securities company also completed another capital increase, although the time was reduced to one year, but it was still relatively slow. Therefore, many shareholders could not help but wonder about the time it could complete the newly approved capital increase of 3,600 billion VND.

Mr. Johan Nyvene - Chairman of the Board of Directors of HSC, shared that for the capital increase during the pandemic, the company took two years, so it learned a lot of experience in implementation. Therefore, in the next issuance, the time was reduced to one year.

Based on the lessons learned, this capital mobilization is expected to be completed within about 6 months. Both HSC and state shareholder HFIC are committed to complying with the law and "knocking on all doors where opinions are needed".

The chairman of the securities company affirmed that he is "highly confident" that the company will certainly do well in this capital increase.

According to him, state shareholders have certain difficulties in the mechanism, but this plan has received high support from HFIC leaders and the governing body of this shareholder (HCMC People's Committee). There are things that cannot be overcome by the mechanism, but always find ways to achieve the goal.

Why is capital increase urgent?

Instead of waiting for the annual general meeting of shareholders in April 2025, this leading securities company immediately held an extraordinary general meeting today, attracting the attention and questions of many investors.

Mr. Trinh Hoai Giang - General Director of HSC - replied that increasing capital is "very necessary and urgent" because currently the loan-to-equity ratio of the enterprise is nearly doubled, approaching the legal threshold.

Since the beginning of last month, according to new regulations, foreign investors do not need to transfer enough money to buy securities. Currently, no foreign investors at HSC have violated the late payment, but the company also needs to prepare for situations.

In addition, it is forecasted that by 2025, liquidity in the stock market will reach VND15,000 billion/session (VND5,000 billion lower than this year), while investors' demand for margin loans will not increase dramatically, but will still be high.

According to Mr. Giang, the highlight is that the company only focuses on margin lending in stocks with good fundamentals, supported and highly appreciated by customers. Therefore, the quality of customer assets at the company is also high, and loan demand is still increasing well.

Not to mention, "customers are not afraid of market crashes, very different from 10 years ago," said Mr. Giang. If a developing market is at risk, typically the US stock market, in Vietnam many investors choose to trade derivatives instead of selling stocks.

Mr. Giang said that with the development of our country's securities, it is necessary to increase capital "as soon as possible".

When collecting an additional VND 3,600 billion in this capital increase deal, the enterprise will allocate it to margin lending (70%) and proprietary trading (buying and selling stocks and bonds).

HSC leaders forecast that in 2024, the company will achieve revenue of nearly VND 3,300 billion and pre-tax profit of more than VND 1,300 billion, up 46% and 55% respectively over the same period last year.

Source: https://tuoitre.vn/chung-khoan-hsc-thong-qua-phuong-an-tang-von-vuot-10-000-ti-20241204163635439.htm