Vietnam’s TNH Hospital Group okayed to raise foreign ownership cap to 70%

TNH Hospital Group JSC, based in Vietnam’s northern province of Thai Nguyen, has received approval from the stock market watchdog to increase its foreign ownership limit (FOL) from 49% to 70%.

Vietnam Securities Depository and Clearing Corporation was assigned to make corresponding adjustments, the State Securities Commission stated last week. The commission did not specify when the new FOL comes into effect.

Such an FOL relaxation will help increase the liquidity of the stock, the company’s leadership said at its 2024 AGM. TNH Hospital Group is listed on the Ho Chi Minh Stock Exchange (HoSE) as TNH.

The company will also be better positioned to raise funding, expand operations, and shift the ownership structure in favor of foreign shareholders, they added.

According to financial data platform Vietstock and Saigon Securities Inc., foreign ownership in the hospital stood at 47.31% as of August 29. Among major shareholders are KWE Beteiligungen AG with 10.5%, Blooming Earth Pte. Ltd. with 9.1%, and Access S.A., Sicav-sif-Asia Top Picks with 6.35%. KWE Beteiligungen AG is the firm’s largest shareholder.

Chairman Hoang Tuyen owns a 6.67% stake and CEO Le Xuan Tuan 1.8%.

After TNH unveiled its intention to raise the FOL early in June, TNH shares jumped 35% in one month to a record high of VND28,500 ($1.15) apiece on July 9. However, the stock has lost steam since and closed at VND23,150 on Thursday.

TNH earned an audited consolidated net profit of VND53.55 billion ($2.15 million) on revenue of VND222.5 billion in the first half of this year, down 13.6% and 3.1% year-on-year, respectively.

The firm aims for a net profit of VND155 billion ($6.23 million) this year and revenue of VND540 billion, up 12% and 2% from 2023.

Foreign appetite for medical shares

The FOL relaxation at TNH comes at a time when foreign players are carving shares of pharmaceutical and healthcare companies in Vietnam.

South Korea’s SK Investment currently controls 64.8% of Imexpharm (HoSE: IMP), while Japan’s ASKA Pharmaceutical Co., Ltd. owns 35% of Ha Tay Pharmaceutical JSC (HNX: DHT). Notably, Taisho Pharmaceutical now owns 51% of DHG Pharmaceutical (HoSE: DHG).

Overseas investors also hold majority stakes at Bidiphar (HoSE: DBD), Traphaco (HoSE: TRA), and Domesco (HoSE: DMC).

In the hospital business, in 2023, Singapore’s Thomson Medical Group acquired FV Hospital for $381.4 million, and Singapore’s Raffles Medical Group became a strategic partner of American International Hospital (AIH).

VinaCapital Vietnam Opportunity Fund (VOF) now owns a majority stake in Tam Tri Medical.