Shares of Vietnam's Sabeco soar 41 per cent in four days

Saigon Beer, Alcohol, Beverage Corporation (Sabeco), Vietnam's biggest brewer, had a furious debut at the Ho Chi Minh Stock Exchange on Tuesday. The share price of the of state-controlled brewer jumped the maximum allowed 20 percent upon listing on its first day when the shares rose from a reference price of VND110,000 ($4.9) to VND132,000 ($5.8). On Friday at the end of the first week the stock closed at 161.500 ($7.1), which is an impressive increase of 47% within 4 days.

Vietnam has one of the world’s fastest-growing economies due to its young population and a rising middle class. Sabeco is by far the leading brewer in Vietnam with a share of nearly 41% of the fast growing beer market and has attracted attention of more than 20 investors including breweries like AB InBevHeinekenKirin HoldingsAsahi Group Holdings and Thai Beverage.

Vietnamese Ministry of Industry and Trade is still holding a controlling stake of 89.59% in Sabeco but has announced to sell it entirely in 2017. Foreign ownership in the company is said to be 9.39%. Heineken already holds a 5% stake in the brewery and is therefore considered frontrunner in race for Sabeco. Heineken’s CEO Jean-François van Boxmeer is eager to extend the ownership but will see a fierce competition. Earlier this year Heineken already acquired Carlsberg Vietnam Brewery-Vung Tau in the south Vietnam port city, bringing the Dutch brewer to a 20% market share, slightly ahead of the second state owned brewer Hanoi Beer Alcohol Beverage Corp. (Habeco) with 17%.

Habeco is also on the sales list of the Vietnamese government. The brewery, which is headquartered in Vietnam’s second largest city Hanoi, has been listed since October 28 on Vietnam’s regulated over-the-counter exchange. Like with Sabeco, the share price of Habeco has soared from its starting price at VND 39,000 ($1.7) to VND 144,700 ($6.4) before falling down again to its current price of  VND58,000 ($2.6). Danish brewer Carlsberg already holds a 17.51% share in the company and would be willing to bid for a 20-percent stake being sold at an auction. The remaining 61.79% will most probably be offered later to the winner of the auction at the same share price.

 

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