Vietnam Airlines shares soar 40% on debut, giving it US$2.1b value

[HANOI] Shares of Vietnam Airlines surged 40 per cent on their stock market debut on Tuesday, valuing the firm at US$2.11 billion, as investors sought exposure to the country's flagship carrier amid strong growth in regional air travel.

The shares hit 39,200 Vietnam dong (S$2.49) at 0354 GMT on the Unlisted Public Company Market compared to their opening price of 28,000 dong, data from the secondary exchange showed. There were bids for 1.3 million HVN shares, while just 700 shares were bought, the data showed.

Vietnam Airlines is majority owned by the government. Japan's ANA Holdings owns 8.8 per cent of the airline.

Vietnam's airline market is growing at one of the fastest rates in Asia Pacific, boosted by a burgeoning middle class, with the country's airlines placing multi-billion dollar aircraft orders and the South-east Asian nation unveiling plans to shore up infrastructure.

Vietnam Airlines has a 70 per cent stake in Vietnamese low-cost carrier Jetstar Pacific, with Australia's Qantas holding the rest. Its other domestic affiliate is Vietnam Air Service Company and it also owns 49 per cent of Cambodia Angkor Air, a joint venture with the Cambodian government.

The carrier commands about half of the domestic market while the two affiliates have another combined 15 per cent share.

The stock market debut of Vietnam Airlines comes as private sector rival VietJet is gearing up to make its market debut and has been valued at US$1.2 billion, according to Thomson Reuters publication IFR.

REUTERS