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SCIC reports 19-fold returns through 2017 divestment process
Ngoc Thuy 15:17, 2018/01/18
In 2017, State Capital Investment Corporation (SCIC) collected VND21.2 trillion (US$930 million) through divesting state funds from state-owned enterprises (SOEs), an increase of 19 times the initial investment.
SCIC’s revenue reached VND7.3 trillion (US$320 million), with pre-tax profit recorded at VND6.6 trillion (US$289 million), outperforming the target by 13%, according to the company’s year-end report. 
 
​SCIC reports 19-fold returns through 2017 divestment process.
​SCIC reports 19-fold returns through 2017 divestment process.
Notably, SCIC’s net interest in 2017 is estimated at VND6.3 trillion (US$276 million), achieving 135% of the year’s target. 

The company has successfully divested State stakes in 38 SOEs, including the sales of the entire State holding in 36 firms and partial divestments at 2 firms for a return of VND932 billion (US$409 million), 2.2 times the initial investment of VND424 billion (US$18.6 million).

Taking into account the first round of divesting 5.4% of the charter capital at Vietnam Diary Products (Vinamilk), SCIC has collected VND21.2 trillion (US$930 million) in total. 

Since its establishment in 2006, SCIC has completed selling State stakes at 986 SOEs and transferring purchase rights at 19 SOEs for a return of VND28 trillion (US$1.2 billion), 3.5 times the initial investment of VND8 trillion (US$351 million).

As of December 2017, SCIC’s portfolio consisted of 133 SOEs with the book value of State capital reaching VND19 trillion (US$834 million) of the total charter capital of VND90.6 trillion (US$3.9 billion). There were 22 companies in the A1 Group representing 63.55% of SCIC’s portfolio, 9 in the A2 Group (1.22%), 32 in the B1 Group (26.16%), and 70 in the B2 Group (9.07%).

In 2018, SCIC will step up efforts to speed up the progress of taking over State ownership in SOEs and encourage relevant ministries and provinces/cities to transfer the ownership of State capital in SOEs back to SCIC, following the Prime Minister’s request. 

Additionally, SCIC is striving to improve the efficiency of corporate governance and the representation of State ownership, especially in A1 companies. It will also focus on restructuring and completing the prolonged equitization processes at some enterprises. 

In last November, SCIC has successfully divested 3.33% of its stakes at Vinamilk at an average share price of VND186,000 (US$8.1), higher than the initial offering price of VND150,000 (US$6.6). 

The deal has brought in VND9 trillion (US$396 million) and fetched a net profit of VND8.7 trillion (US$382 million), injecting much needed foreign capital into the Vietnamese stock market and contributing significantly to the equitization and divestment of State capital (not included in SCIC’s revenue).

In the short term, SCIC will temporarily keep hold of a number of enterprises as the VN-Index is on the rise. “We will wait for the VN-Index to rise higher before divesting the State’s capital,” said Nguyen Chi Thanh, Deputy CEO of SCIC. 
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