After many years of unsuccessful divestment of state capital at Binh Dinh Pharmaceutical and Medical Equipment Joint Stock Company (Bidiphar), the People's Committee of Binh Dinh province recently proposed to retain capital at this pharmaceutical enterprise.
 |
Hesitating to divest state capital
According to Decision No. 1479/QD-TTg dated November 29, 2022 of the Prime Minister approving the Plan to restructure state-owned enterprises and enterprises with state capital in the period of 2022 - 2025, there are 141 enterprises that the State will divest capital in the period of 2022 - 2025.
In particular, the People's Committee of Binh Dinh province needs to divest capital from two enterprises: Binh Dinh Pharmaceutical and Medical Equipment Joint Stock Company (Bidiphar - stock code: DBD) and Binh Dinh Minerals Joint Stock Company (Bimico). Up to now, through the Binh Dinh Provincial Development Investment Fund, the People's Committee of Binh Dinh is holding 13.34% of DBD and 25% of Binh Dinh Minerals.
While the divestment plan at Bimico has been announced to be implemented from the fourth quarter of 2024 through order matching or negotiation transactions, with a starting price of VND22,300 per share, Binh Dinh has yet to propose a divestment plan at Bidiphar.
Mr. Pham Anh Tuan, Chairman of Binh Dinh Provincial People's Committee, informed that the province is asking to leave state capital in Bidiphar because this is a social security enterprise. Provincial leaders believe that when divesting state capital, key enterprises that affect political and social activities must be left, and enterprises that do not need to be managed should be divested by the State. Although previously, in the report on the implementation of state capital divestment in the third quarter of 2024 sent to the Steering Committee for Enterprise Innovation and Development, the Ministry of Finance, and the Ministry of Planning and Investment, Binh Dinh Provincial People's Committee still reported that "the locality is continuing to develop plans and organize the implementation of divestment to be completed in the period of 2024 - 2025 according to the directive".
Source: Ministry of Finance
In fact, Bidiphar has been included in the Divestment Plan for many years but has not been implemented. In 2020 - 2021, Binh Dinh failed to divest Bidiphar on the stock exchange because the price did not meet the expected price in the context of the Covid-19 pandemic affecting the stock price (DBD shares on the stock exchange decreased, making divestment unfavorable, possibly causing loss of state capital). Therefore, the province has proposed a policy to continue divestment in the period of 2021 - 2025.
According to Decision No. 4608/QD-UBND dated December 10, 2019, the starting price for offering state capital shares at Bidiphar was approved at VND 43,221/share. In early 2020, DBD's share price was VND 55,550/share. Although it decreased due to the impact of Covid-19, it was still at VND 48,600/share in early 2021 and increased again above VND 51,000/share in early 2022.
By 2023, the People's Committee of Binh Dinh province continued to request an extension of the divestment period at Bidiphar until after 2025, citing the reason that divestment in the 2024-2025 period was not favorable and the revenue from divestment did not meet the best expectations, ensuring the interests of the State.
After many years of hesitation, now that the divestment deadline is almost over, Binh Dinh wants to retain state capital at Bidiphar?
Historically, Binh Dinh People's Committee has also proposed to retain state capital in some enterprises. For example, in 2021, Binh Dinh proposed that the Government allow it to continue to hold 51% of charter capital in Binh Dinh Environment JSC and Quy Nhon Urban Green Parks and Lighting JSC on the grounds that the proportion of revenue from public services is above 50%.
How does Bidiphar do business?
Bidiphar is known as a special enterprise in the Vietnamese pharmaceutical industry because the company focuses on developing antibiotic and specialty drugs. It is also the first pharmaceutical company in the country to research and produce cancer treatment drugs.
The company maintains stable revenue and profit. Although the period 2019-2020 decreased, the fluctuation was not large. By 2021, both revenue and profit of Bidiphar have grown strongly and are still bringing in more than 200 billion VND in profit each year.
The financial report for the first 6 months of 2024 shows that the company's net revenue reached 816 billion VND, pre-tax profit reached 165 billion VND. Recently updated, in the first 9 months of the year, the company has achieved 63% of the revenue plan and 77% of the year's profit plan.
 |
Selling self-produced pharmaceuticals is the main source of revenue for Bidiphar. This is currently the only domestic pharmaceutical company participating in the bidding structure for cancer treatment drugs, ranking 6th in value after foreign pharmaceutical companies and leading in output (by drug dose). However, the company's winning bid for cancer treatment drugs is not high because most of them are low-value chemotherapy drugs.
Binh Dinh Provincial People's Committee is still the largest shareholder at Bidiphar. Since its listing, Bidiphar has regularly paid annual dividends, with dividends for the period 2016 - 2020 all paid in cash at a rate of 15% of charter capital, equivalent to VND 1,500/share. During that period, Bidiphar spent nearly VND 80 billion annually in cash dividends, equivalent to about 50% of net profit. With a holding ratio of more than 13%, Binh Dinh Provincial People's Committee received more than VND 10 billion each year. It was not until 2020 that the Company began to implement an additional plan to pay dividends in shares to retain more profits for large investment plans. In 2023, the company paid a dividend of 25% in shares, the plan for 2024 is to pay at least 20% in cash or/and shares.
While Binh Dinh has not yet divested state capital, Bidiphar is also struggling to find a strategic investor. Since 2020, the foreign room at Bidiphar has been opened up to 100% but has not yet found a suitable investor. While in the market, large pharmaceutical companies have received support from foreign shareholders, even becoming subsidiaries such as Hau Giang Pharmaceutical under Taisho Pharmaceutical, Imexpharm under SK, Domesco under Abbott... the story of finding a strategic investor is always mentioned at every shareholder meeting of Bidiphar.
In 2023, the Company planned to issue individual shares to up to 5 investors but has not yet implemented. Bibiphar's 2024 Annual General Meeting of Shareholders continued to approve the plan to offer individual shares to investors with a total expected number of shares offered of 23.3 million shares, a minimum price of VND 50,000/share and implemented in 2024 - 2025.
According to an update from Phu Hung Securities Joint Stock Company (PHS), at the investor meeting at the end of September, Bidiphar's leaders said that the company is currently meeting with 4 domestic and foreign investors, prioritizing the criteria of finding strategic partners who bring new value, can transfer technology and accompany the company for a long time. However, Bidiphar is still facing some difficulties in this deal because its business activities focus on cancer treatment and blood purification solutions, which are quite different from the pharmaceutical market.
Source: https://baodautu.vn/dung-dang-thoai-von-nha-nuoc-tai-bidiphar-d227380.html
![[Photo] Closing of the 11th Conference of the 13th Central Committee of the Communist Party of Vietnam](https://vstatic.vietnam.vn/vietnam/resource/IMAGE/2025/4/12/114b57fe6e9b4814a5ddfacf6dfe5b7f)
![[Photo] Overcoming all difficulties, speeding up construction progress of Hoa Binh Hydropower Plant Expansion Project](https://vstatic.vietnam.vn/vietnam/resource/IMAGE/2025/4/12/bff04b551e98484c84d74c8faa3526e0)
Comment (0)