Securities companies set mixed earning targets this year

Investors watch stock indices. Photo tinnhanhchungkhoan.vn

After strong growth in 2021, securities companies have set mixed earning targets this year.

Achieving pre-tax profit of 534 billion VND (23.3 million USD) last year, Viet Dragon Securities Co (VDS) sets a pre-tax profit target of 504 billion VND this year, down 5.5 percent. This plan is based on the forecast that VN-Index this year fluctuates around 1,340-1,750 points and the average liquidity is 25 trillion VND to 30 trillion VND per session.

FPT Securities Joint Stock Company (FTS) sets a revenue target of 1.09 trillion VND this year, down 3.7 percent year-on-year and pre-tax profit down 6.3 percent, to 680 billion VND. Viet Capital Securities (VCI) approved the plan with revenue of 3.24 trillion VND, down 13 percent and pre-tax profit of 1.9 trillion VND, a slight increase of 2.7 percent compared to 2021.

Some other securities companies have set more optimistic targets.

Thanh Cong Securities Joint Stock Company (TCI) set a profit target of 222 billion VND, up 2.3 percent.

Smart Invest Securities (AAS) expects revenue to reach 1.2 trillion VND, up 25 percent, profit after tax is estimated at 480 billion VND, up 27 percent. Phu Hung Securities (PHS) plans to achieve revenue of 604 billion VND and profit after tax of 160.5 billion VND, up 19 percent and 14 percent, respectively from the previous year's results.

After restructuring and witnessing strong growth, Tien Phong Securities (TPS) sets a revenue target of 1.98 trillion VND, profit before tax of 500 billion VND, up 46 percent and 85 percent, respectively compared to 2021.

Securities companies forecast that the stock market is still an investment channel to attract investors, but organisations and inpiduals have to focus more on recovering and promoting production after the pandemic.

According to Viet Capital Securities (VCI), the VN-Index will reach 1,550 points by the end of 2022.

Nguyen Mien Tuan, Chairman of the Board of Directors of Viet Dragon Securities (VDS), said that inflation exploded around the world and spread to Vietnam, thereby affecting the stock market. Not to mention, the stock price level is at a high level, which is not favourable for the proprietary trading of securities companies.

According to Tuan, in the current conditions, the proposed plan is positive. "We will try our best to fulfil the plan,” Tuan said.

Tran Son Hai, General Director of Tien Phong Securities Co., the full-year profit plan seems to be modest compared to the results of the first quarter of 300 billion VND.

“After June, when the company has finished raising capital, it can adjust the profit plan accordingly,” Hai said.

“In addition to revenue from consulting services for bond issuance, Tien Phong Securities will promote segments such as stock brokerage, warrant offering, derivatives trading as well as proprietary trading,” he said.

Many securities companies have planned to raise capital. In previous years, a securities company would be unlikely to have a capital of 1 trillion VND, now there are companies with the capital size of a mid-sized bank, such as SSI Securities at 15 trillion VND and VNDirect Securities with 12 trillion VND.

Many small securities companies also plan to increase capital. Smart Invest wants to increase to 5 trillion VND, DNSE Securities to 3 trillion VND, and APG Securities to 4 trillion VND.

It is not possible to take the performance results of a year with many favourable conditions to set a step-by-step plan for the following years.

As for AAS, it is expected that the entire amount of money raised will be allocated to the company's activities, including investing in valuable papers in the market, margin trading and securities underwriting and issuance activities.

Securities companies are actively adding financial capacity, because, in addition to increasing the ability to provide margin, it also opens up business opportunities in other areas, with many other products./.