Vietjet looks set to raise $170 million from IPO
By Viet Nam News
19 December 2016

HANOI (Viet Nam News/ANN) - Vietjet is set to raise $170 million through an initial public offering.

Vietnamese budget airline Vietjet has set its initial public offering (IPO) of 44.78 million shares, equal to 14.9 per cent of the firm’s chartered capital of 3 trillion dong ($133.3 million), to raise $170 million, Reuters reported on Thursday.

The share price would be 84,600 dong for institutional investors and 86,500 dong for individual investors. The IPO would value the firm at $1.2 billion.

The number of shares bid by the buyers have exceeded that of the shares offered by Vietjet at the IPO, Reuters reported, however, the airline will not increase the number of shares sold at the IPO.

The IPO of Vietjet is co-ordinated by some domestic and international financial institutions, such as BNP Paribas, JP Morgan, Deutsche Bank and VietCapital Securities.

Vietjet shares are expected to start trading at 88,800 dong on their debut on the HCM Stock Exchange in February 2017.

Vietjet declined to comment on the deal.

The funding raised from the IPO is expected to aid in increasing Vietjet’s equity and help the company expand its operations in some domestic airports and expand its routes.

Vietjet is expected to increase the number of domestic routes from the current 36 to 45 by the end of 2019 and international routes from 19 to 36 by 2018.

In 2015, Vietjet received 19.84 trillion dong in combined revenue and 1.17 trillion dong in net profit, a year-on-year increase of 128 per cent and 225 per cent respectively from 2014.

In the first half of this year, the firm’s revenue rose 41 per cent to 12.55 trillion dong and its net profit gained two-thirds to 1.23 trillion dong.

At the end of September 2016, Vietjet recorded an increase of 40 per cent in revenue and 70 per cent in net profit on a 54 per cent growth of its flight numbers.

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