Big shareholders rush to sell shares in big quantities

Posted on August 20, 2012

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Mr Dang Thanh Tam, one of the richest stock millionaires.

Twenty sale transactions have been carried out or registered by the big shareholders just within one month. Especially, the amounts of shares offered on sale for every trading deal were very big – millions or tens of millions of shares.

A lot of the VIP shareholders, who were the members of the board of directors or board of management, have registered to sell their shares recently.

In early July, Do Van Trac, Chair of Truong Phu Joint Stock Company (TGP – UpCom) successfully sold one million TGP shares.

One week later, Le Xuan Hai, Chair of the Ninh Van Bay Real Estate and Tourism Company (NVT – HOSE), registered the sale of 3.7 million shares. The move was explained as aiming to “balance personal financial demand.”

Also in July, Nguyen Hoang Long, Deputy Chair of Au Viet Securities Company (AVS – HNX) also registered to sell 900,000 shares.

Dang Thanh Tam, a well-known businessman in Vietnam with its name listed among the richest stock millionaires in Vietnam, surprised many people when he unexpectedly decided to sell 22 million shares of the Saigon – Quy Nhon Mineral Corporation (SQC – HNX) worth 1400 billion dong.

The move by Tam was a surprise to investors because SQC reportedly made a fat profit in the first half of the year, while investors believed that the prices of the shares would continue rising.

Especially, Tam is the elder brother of Dang Thi Hoang Phuong, Chair of SQC. The decision by Tam was released after SQC announced the impressive profit of 86 billion dong, which was 162 percent higher than that of the same period of the last year

Also in July, IPA–an investment group, which has relations with a member of the board of directors of VNDirect Securities Company (VND – HNX), also sold 5 million shares. The Green City Development Joint Stock Company managed by Deputy General Director of Vingroup Hoang Bach Duong sold 4 million VIC shares to take back the investment capital.

In August, Nguyen Khac Lac, a member of the board of directors of AVS, sold 1.6 million shares of the company more, thus reducing his ownership ratio in the company to 0.28 percent.

In March 2012, AVS was given warning for its unprofitable business performance which began in 2011.

Bui Tuan Ngoc, Chair of TMS, a freight and forwarding company, has also sold 1.76 million shares, or 9.65 percent of the total number of shares now in circulation.

Commenting about the movement, Nguyen Viet Duc, Research & Analysis Director of SHF, believes that in general, the sale of stakes in big quantities shows negative signs in the operation of enterprises, or the loosened attachment of the managers to the enterprises.

Duc also said that in many cases, big shareholders or managers sell stakes because they want to narrow the operation scale or to get money for other investment projects.

“Businessmen invest in many different business fields, and then they would sell the shares to make profit and to gather their strength on their main business fields,” Duc commented.

Meanwhile, some investors have expressed their worry that big shareholders sell stakes to make profit, while they do not intend to make long term investment in the enterprises.

The stock market once witnessed the sale of stocks in massive scale in 2007. However, the situation then was quite different from now. At that time, investors sold shares because the market was scorching hot, which allowed them to have good prices.

Meanwhile, investors now decide to sell shares because they want to restructure the investment portfolios in the current economic difficulties.

Thu Uyen

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Posted in: Business, Corruption