Wave of share buybacks emerges as Vietnam market corrects

A growing number of Vietnamese companies, including Vinh Hoan Corporation, Kido Group, and DIC Corp, have announced plans to spend tens of millions of U.S. dollars to repurchase shares as the stock market undergoes a sharp correction, aiming to reduce outstanding shares and support stock prices.

Vietnam’s benchmark VN-Index, which tracks the performance of the Ho Chi Minh Stock Exchange (HoSE), has come under heavy pressure over the past two weeks amid geopolitical tensions in the Middle East. The index has fallen from around 1,877.36 points to below the 1,700 mark, pushing many stocks back to price levels last seen during previous periods of market turbulence.

Against this backdrop, alongside major shareholders registering to buy shares, several companies have also launched share buyback plans to reduce charter capital, thereby lowering the number of outstanding shares and sending a signal of price support to the market.

Vinh Hoan Corporation (HoSE: VHC) recently announced a board resolution to implement a share repurchase plan approved by shareholders on February 12, 2026. Under the plan, the seafood exporter intends to buy back up to 15 million shares to reduce charter capital and enhance shareholder value.

The buyback will be funded through internal resources and undistributed after-tax profits based on the company’s reviewed consolidated financial statements for mid-2025. Shares will be repurchased at market prices at the time of transaction, with a maximum price of VND63,000 ($2.4) per share, implying a total potential value of about VND945 billion ($35.95 million).

At the time the plan was announced, Vinh Hoan shares were trading around VND55,000 ($2.09) per share, well below the roughly VND70,000 level recorded before the recent market turbulence linked to macroeconomic factors. After the buyback announcement, the stock rebounded to above VND61,000 ($2.32) despite ongoing geopolitical tensions.

Similarly, Kido Group (HoSE: KDC) approved at an extraordinary shareholders’ meeting on March 6 a plan to repurchase up to 14.49 million shares, equivalent to roughly 5% of its outstanding shares, also aimed at reducing charter capital. The buyback is expected to be implemented between the first and third quarters of 2026.

Some shareholders at the meeting voiced concerns that share repurchases could strain the company’s operating cash flow. However, the company’s management said the funding would primarily come from retained earnings, share premium, and other reserves, and that cash flow considerations had been carefully evaluated to ensure the buyback would not affect working capital or long-term investment plans.

Vice chairman and CEO Tran Le Nguyen said the move aims to protect shareholder interests at a time when the company has excess capital.

“On the market, KDC’s share price is not particularly low but still does not fully reflect the company’s intrinsic value,” Nguyen said. “With the surplus capital available, we want to carry out the share buyback to enhance shareholder value.”

Over the past year, Kido shares have declined from around VND57,300 to about VND50,800 ($1.93) per share, a drop of roughly 12.7%. While the correction is not large, the stock has disappointed investors during a period when the broader market rallied strongly from about 1,090 points to nearly 1,900 points before the recent pullback.

Meanwhile, DIC Corp (HoSE: DIG) is planning to repurchase up to 5% of its outstanding common shares, equivalent to about 40 million shares, as its stock price has fallen sharply from around VND24,600 to about VND13,000 ($0.49) per share.

Notably, late last year, the company issued 150 million shares to existing shareholders at VND12,000 ($0.46) per share, raising around VND1.8 trillion ($68.45 million) for business operations. With the stock price now approaching the issuance level, the company plans to spend about VND520 billion ($19.77 million) to buy back shares in an effort to stabilize the share price.

The move highlights how companies may adopt multiple financial measures to stabilize investor sentiment when market valuations decline sharply.

Signal of confidence

Under the Vietnam Securities Law 2019, companies that repurchase their shares must subsequently carry out procedures to reduce charter capital, meaning the repurchased shares are canceled rather than held as treasury stock as previously allowed.

As a result, funds used for buybacks are effectively returned to the market, making such decisions subject to careful consideration to avoid affecting operational cash flows.

In many cases, share repurchases are interpreted by the market as a signal from company management that the stock is trading below its intrinsic value. A reduction in outstanding shares can also improve financial indicators such as earnings per share (EPS), which may support valuations in the market.

Amid heightened volatility, proactive share buybacks can also help reinforce investor confidence that a company’s operations remain stable and that it has sufficient cash flow to pursue long-term strategic plans.