OTC market: many buyers, many more sellers

Unlike the hot OTC (over the counter) market a couple of weeks ago, unlisted shares these days are finding it hard to find customers.

Shares of several big banks like Eximbank, EAB, An Binh, Phuong Nam and Habubank have been trading well; however, the prices have decreased by 2-5% compared to last week.

Prices have been decreasing since investors heard the warnings about the overly high prices of unlisted shares, which proved to exceed the actual values, though joint stock banks all announced good business performances in 2006.

Big lots of shares (1,000 shares and more) found it hard to be sold on February 5 and 6. Hot share items including Mai Linh, Alphanam and PVI have all seen price decreases.

Mai Linh shares are being offered at VND43-48,000/share. However, transactions succeeded at VND42,000/share, while no investor dares buy large lots of shares (5-10,000 shares) at this moment.

PVI, which once hit the VND175,000/share level, was traded at VND165,000/share on February 6. There are a lot of offers for sale of these share items on OTC websites, while very few offers for buying were found.

SSI bonds, which were once traded at more than VND80,000/share, now are being offered at VND75,000/share.

The OTC market proves to be more sensitive than the official stock market. Investors sell shares immediately when prices begin going down. As the volume of shares sold has been too big, no one dares buy unlisted shares at this moment. Shares issued by Gia Dinh, Cho Lon Water Supply Companies cannot find customers now, and nor can shares of seafood, real estate and rubber companies. The offers for large lots of shares (more than 5,000 shares) of the non-bank and non-insurance companies these days prove to be hard to be successful.

Explaining the “shift of the wind”, the deputy director of a big securities company said that the information about the stricter control to be put over the OTC market had prompted investors to sell shares. There are too many share items on the OTC market, some 850 items, and the trading has been on a mess.

Meanwhile, Tran Quang Long, an investor at SSI’s trading floor, said that investors wanted to sell shares to take back capital as Tet was approaching. Many investors have to borrow money to trade securities and it is the right time to pay debts.

Source: Tiền Phong