HCMC, June 23, 2020 – Ho Chi Minh City Securities Corporation (HSC) (HOSE: HCM) organized Annual General Meeting FY 2019 at New World Hotel, 76 Le Lai Street, District 1. The meeting summarized the business performance of 2019 and approved the business plan in 2020 with the aim of sustainable development in the context of challenging markets.
The AGM is expected to officially approved the following proposals:
- The Audited Financial Statements for the year ended 31 December 2019
- The FY2020 business plan
- Report of the appointment of Chief Executive Officer
- FY2019 final cash dividend rate
- FY2020 dividend plan
- FY2019 profit distribution plan
- Appointment of the independent audit firm for the fiscal year 2020
- The supplements to HSC Business Registration Certificate referring to English name and abbreviation of company name
- HSC Regulations of Virtual Annual General Meeting
The Vietnamese stock market in 2019 did not move in the way it was expected, causing profound challenges to HSC’s performance. However, HSC’s efforts paid off as it was able to build a stronger foundation for future growth, maintain its solid financial position, protect and enhance shareholders’ capital.
In 2019, HSC posted VND1,262 billion of revenue and VND432 billion of net profit, which translated to 26% and 36% decreases from last year, respectively. The sharp fall of 30% in trading value as well as the sluggish market condition led to the decline in profit and the miss of expectation in 2019
Regarding dividends, after paying the FY2019 interim dividend at the rate of 5% (equivalent to VND500 per share), paying in cash on December 19, 2019, the AGM approved the FY2019 final cash dividend rate at 7% of par value (equivalent to VND 700 per share). Expected record date will be on 10 July 2020 and expected payment date will be on 31 July 2020. The AGM also authorizes the BOD to decide FY2020 dividend rate based on HSC financial performance at the dividend payment time, in which the FY2020 dividend payout rate is 12%.
The meeting also approved 2020 business plan, in which HSC targets to achieve a total revenue of VND1,297 billion. The target net profit after tax is VND453 billion. The return on average equity ratio (ROAE) in 2020 is expected to be at 10.8%.
the securities brokerage fee, margin loans, and proprietary investments businesses are expected to generate the most revenue to HSC in 2020, accounting for 37%, 34% and 24% of total revenue, respectively.
- Brokerage services
In 2020, HSC will focus on restructuring our retail brokerage team and diversifying product and service portfolio to better serve clients. Another strategic priority is to further invest in digital capabilities as HSC aims to offer clients more convenience and time-saving.
institutional client brokerage business is expected to be able to maintain its leading market share of 25% in 2020
In the derivatives market, HSC’s market share has been recovering positively in the first two quarter, especially in the second quarter of 2020. HSC expects to see that trend in the second half of this year and in both private and institutional client segments despite the fact that competition remains fierce.
- Margin loans
The average margin loan balance in 2020 is expected at VND4,200 billion, which is similar to that in 2019. In early 2020, HSC successfully introduced new margin lending model, which was built on global best practices to further enhance client experience.
Besides, HSC will adhere to rigorous credit risk management policies including comprehensive stock analysis approach. Ultimately, HSC also provides prompt financial support to client transactions while preventing financial loss from excessive investing in risky businesses.
- Proprietary investments
Revenue from proprietary investments in 2020 is expected to reach VND309 billion, which translates to a strong growth of 39% from last year. The key revenue growth driver is bond investments, especially corporate bonds, which usually have lower risk than other asset classes. HSC will continue to ramp up new product development and market making activities for the purpose of risk hedging and to support client trading.
- Financial advisory services
Revenue from financial advisory services in 2020 is expected to reach VND 66 billion. HSC is also pitching new opportunities in both debt and equity markets as attempt to increase corporate finance advisory revenue in the following quarters of 2020.
In the midst of the current market buoyancy, HSC is confident in its ability to leverage strengths as well as advantage on capital to deliver strong return on capital to shareholders.
The Board of Directors also propsosed the Meeting to approve the regulation of organizing the online meeting of shareholders and adjusting head office address with the new address: Floor 2,5,6,11 & 12 AB Tower, 76 Le Lai, District 1, Ho Chi Minh City