Business leaders spend money on stock bottom fishing

Since many stocks have dropped to attractive territories, a series of internal shareholders of companies have aggressively spent billions of Vietnamese dong (VND1 billion = $40,200) to "bottom-fish" stocks.

In the period from November 14-16, Nguyen Duc Tai, chairman of Mobile World Investment Corporation (Ho Chi Minh Stock Exchange: MWG), successfully bought 1 million shares of MWG. Dang Minh Luom, a board member and Tran Huy Thanh Tung, general director, bought 100,000 shares and 500,000 shares, respectively.

The three senior leaders spent an estimated VND64.82 billion ($2.61 million) buying the shares.

In another case, Bui Cao Nhat Quan, son of NovaGroup chairman Bui Thanh Nhon, spent about VND128.8 billion ($5.18 million) to successfully buy two million shares of Novaland (HoSE: NVL) from October 14 to November 3, thereby owning more than 83.2 million shares of NVL or a 4.269% stake.

NovaGroup - the largest shareholder of NVL, in the period from October 14 to January 1, bought more than 1.8 million shares out of a total of eight million registered shares. After this transaction, NovaGroup increased its ownership rate in NVL to 37.11%.

Nguyen Lien Huong, daughter of GELEX Group JSC's (HoSE: GEX) chairman, spent an estimated VND12.35 billion ($497,000) to buy one million GEX shares in the period of October 21 to November 16.

Recently, Mai Huu Tin, chairman of Truong Thanh Furniture Corporation (HoSE: TTF), announced registration to buy 10 million TTF shares from November 23 to December 22. If the transaction is successful, he would directly hold a 2.43% stake of the company.

Being general director since April 2017 and then changing to the board chairman position from June 2019, Tin has never bought TTF shares. Meanwhile, U&I Investment Corporation, a private company owned by Tin as chairman, currently holds 29 million TTF shares or a more than 7% stake as largest shareholder.

An Phat Holdings JSC (HoSE: APH) registered to buy two million An Phat Bioplastics JSC (HoSE: AAA) shares from November 21 to December 20.

Some of AAA leaders also registered to buy two million AAA shares in total. Specifically, Hoa Thi Thu Ha, deputy general director of AAA and Nguyen Thi Tien, a board member, both registered to buy one million shares. The transactions would be made between November 21 and December 20.

In APH, Pham Do Huy Cuong, a board member and deputy general director, would buy one million shares of APH, bringing his ownership to 1,125,000 shares, accounting for 0.46%. The transaction period is from November 21 to December 20.

Dao Huu Huyen, Duc Giang Chemical Group (HoSE: DGC) chairman, has registered to buy one million more DGC shares to increase ownership. The transaction is expected to be carried out from November 17 to December 16.

The largest transaction would be that of the KinhBac City Development Holding Corporation's (HoSE: KBC) chairman, who registered to buy 25 million KBC shares during the period November 15-December 14.

Luong Tri Thin, chairman of Dat Xanh Group JSC (HoSE: DXG), is expected to buy 10 million shares from October 27 to November 25. Pham Gia Ly, chairman of Licogi 14 JSC (HNX: L14), announced to buy 500,000 shares of L14 from November 3 to December 2.

The board of Nam Long Investment Corporation (HoSE: NLG) approved Monday the policy of buying back shares with a total value not exceeding VND1 trillion ($40.24 million), extracted from the company's undistributed profit.

With VND1 trillion, the company can buy more than 42.6 million NLG shares if calculations are based on its shares price at the closing morning session on November 22.

Huynh Minh Tuan, founder of FIDT JSC, an investment consulting and financial planning firm, considers the purchases or registrations to buy a positive signal showing the leadership's belief in their business. This will have a positive impact on investor sentiment.

Such moves might also reflect company fears of being acquired by outsiders amid the market downturn.

Tuan cautioned that investors "should not be in a hurry to be optimistic", because market risks are still persistent due to the unfavorable and unclear macro factors.

However, in the long term, with historically low valuations, Vietnam's stock market is still a good investment environment for long-term investment and asset accumulation, Tuan added.