“Divestment game” at Domesco?

The average trading volume per session in 2024 of DMC shares was only less than 3,000 units/session, but in just the last 3 trading sessions before the Lunar New Year holiday (January 22-24, 2025), the average trading volume skyrocketed to nearly 31,000 units/session.

The average trading volume per session in 2024 of DMC shares was only less than 3,000 units/session, but in just the last 3 trading sessions before the Lunar New Year holiday (January 22-24, 2025), the average trading volume skyrocketed to nearly 31,000 units/session.

The defensive pharmaceutical stock DMC of Domesco Medical Import-Export JSC suddenly hit the ceiling on January 22 and 23, 2025 with a volume surge of 16,300 units and 11,800 units, bringing the stock price to VND82,400/share. In the last trading session before the Tet holiday, January 24, DMC traded a sudden volume of 64,700 units, closing at VND83,000/share.

Investors believe that this development shows a positive reaction of cash flow to the news that the largest share auction in the past 2 years is about to take place: SCIC wants to auction off the entire lot of nearly 35% of shares in DMC at an extremely high price.

On January 22, according to the announcement of Ho Chi Minh City Stock Exchange (HOSE), it will organize an auction of the entire lot of more than 12 million shares of Domesco Medical Import-Export JSC (code DMC), equivalent to 34.71% of the capital owned by the State Capital Investment Corporation (SCIC).

The starting price for this lot of shares is over VND 1,531 billion, equivalent to VND 127,046/share. This price is much higher than the market price of DMC (reference date January 22) on the stock exchange (VND 72,100/share).

This is not the first time SCIC has wanted to divest all its capital from DMC. In 2019, SCIC failed to sell capital from this pharmaceutical company due to lack of investors. At that time, the starting price for each share was VND119,600/unit, 64% higher than the market price of DMC shares at the same time.

As of December 31, 2024, DMC has a charter capital of more than VND 347 billion. Abbott Laboratories (Chile) Holdco SpA is Domesco's largest shareholder, holding 51.68%, followed by the State Capital Investment Corporation (SCIC) with more than 34% of capital.

Abbott Laboratories is expected to buy all of SCIC's divested shares at Domesco this time, because even though it owns more than 51%, it still cannot have full decision-making power, as SCIC still owns more than 34%, and has the right to veto important contents at DMC.

Abbott Laboratories increased its controlling stake to over 51% in DMC in 2016 after purchasing DMC and increasing the foreign ownership limit to 100%. It is estimated that foreign shareholders spent about VND400 billion to acquire DMC. The value of these shares has now reached nearly VND1,300 billion, about 3 times the initial investment. Not to mention, DMC pays "huge" dividends every year very regularly.

In 2024, DMC recorded net revenue of VND 1,899 billion, an increase of 10% compared to 2023. This is also a record high in its operating history. Profit after tax reached VND 203 billion, an increase of 11% and completed the plan - VND 200 billion.

Source: https://baodautu.vn/game-thoai-von-tai-domesco-d243417.html