VND loses market share

In a recent report, DSC Securities Joint Stock Company (DSC) did not give a valuation of VND shares of VNDirect Securities Joint Stock Company in a recent report.

Previously in May 2024, DSC still valued VND shares at VND 25,200/share.

DSC assessed that VND is at risk of losing its brokerage market share. By the end of the third quarter of 2024, VNDirect's brokerage market share on HoSE fell to 5.7%, down to 6th place, the lowest since 2016.

“In the short term, VNDirect’s market share is unlikely to recover strongly. Overall, VNDirect is still a big name in the brokerage market, but is under pressure from larger competitors in a volatile and competitive market,” DSC said.

To improve operational efficiency and expand market share, VNDirect is promoting its online brokerage channel, but it needs more time to record positive impacts.

VNDirect's market share declined, so its margin lending also stagnated amid the increase in margin across the entire securities group in the third quarter. VNDirect's outstanding loans reached nearly VND10,900 billion, equivalent to the same period in 2023. The remaining lending space is very large because the outstanding loan/equity ratio by the end of the third quarter had dropped to 56%, significantly lower than the industry average.

Preferring to invest in bonds VNDirect's proprietary trading portfolio continued to expand by more than VND3,000 billion in the third quarter, with the focus on disbursement being government bonds and bonds issued by banks. This strategy will help reduce the risks of the investment portfolio. The high proportion of bonds and certificates of deposit means that proprietary trading revenue mainly comes from the profit from selling these financial assets and the interest accrued. However, the less active stock market caused FVTPL revenue to decrease by 36% compared to the same period. Revenue from HTM assets (deposits) also decreased sharply to VND97 billion as VNDirect reduced the proportion of short-term deposits.

In the third quarter, VNDirect's business results continued to grow negatively compared to the same period last year.

VNDirect's outstanding loans reached nearly VND10,900 billion, equivalent to the same period in 2023. The remaining lending space is very large because the outstanding loan/equity ratio as of the end of the third quarter has decreased to 56%, significantly lower than the industry average.

VNDirect’s outstanding loan growth in the past three quarters has been relatively dismal compared to other large securities companies in the context that the company is gradually losing market share to competitors. VNDirect’s brokerage market share on HoSE in the third quarter fell to its lowest level since 2016, at only 5.7%.

VNDirect's proprietary trading portfolio continued to expand by more than VND3,000 billion in the third quarter, with the focus on disbursement being government bonds and bonds issued by banks.

According to the third quarter report, the Financial assets recorded through profit and loss (FVTPL) item was over VND 24,400 billion, an increase of VND 7,762 billion compared to the end of 20023, of which unlisted bond investment increased by VND 3,500 billion.

In the market, VND stocks are fluctuating strongly with sudden liquidity and prices tending to decrease due to information related to businesses in the VND portfolio holding bonds that are losing money such as Trung Nam or Crystal Bay.

Crystal Bay JSC, late in paying bonds with a total principal value of 421 billion VND on November 5, 2024 to bondholder VNDirect, which owns 100% of these bonds.

VNDirect has a charter capital of 15,200 billion VND, making it the securities company with the largest charter capital today.

Source: https://baodautu.vn/dsc-du-bao-nguy-co-danh-mat-thi-phan-cua-chung-khoan-vndirect-d231985.html