Question: What conditions must an enterprise meet to list on the Ho Chi Minh Stock Exchange (HOSE)?
To be listed on the Ho Chi Minh Stock Exchange (HOSE), an enterprise must comply with the general provisions stated in Article 109 of Decree 155/2020/ND-CP (Decree detailing the implementation of several articles of the Securities Law 2019) and the specific regulations of HOSE.
According to Article 109 of Decree 155/2020/ND-CP, an enterprise must meet the following conditions:
- It must be a joint-stock company with a charter capital of at least VND 30 billion at the time of registration for listing, based on the latest audited financial statement. Additionally, its market capitalization must reach at least VND 30 billion, calculated by the weighted average of the stock price during the most recent public offering in accordance with Decree 155/2020/ND-CP, or the reference price of the stock traded on the Upcom trading system for the last 30 sessions before the listing registration submission, or the weighted average stock price in the initial public offering of a privatized enterprise.
- The General Meeting of Shareholders must have approved the listing; the enterprise must have traded on the Upcom trading system for at least 2 years, except for the case where the listing registrant has offered shares to the public or is a privatized enterprise.
- The return on equity (ROE) for the year preceding the listing registration must be at least 5%, and the enterprise must have been profitable in the two years preceding the listing registration. It must not have any overdue debts for more than 1 year as of the listing registration date. There must be no accumulated losses, based on the most recent audited financial statement or the reviewed interim financial statement, in the case of listing registration after the end of the interim financial reporting period.
- Except for privatized enterprises, the listing registrant must have at least 15% of the voting shares held by at least 100 shareholders who are not major shareholders. If the charter capital of the listing registrant is VND 1,000 billion or more, the minimum ratio is 10% of voting shares.
- Shareholders who are individuals or organizations with representatives serving as Chairman of the Board of Directors, members of the Board of Directors, Head of the Supervisory Board, members of the Supervisory Board (Supervisors), General Director (Director), Deputy General Director (Deputy Director), Chief Accountant, Chief Financial Officer, and equivalent managerial positions elected by the General Meeting of Shareholders or appointed by the Board of Directors, and major shareholders who are related persons of these individuals, must commit to holding 100% of their shares for 6 months from the first trading day on the Stock Exchange and 50% of those shares for the next 6 months, excluding state-owned shares held by these individuals as representatives.
- The company and its legal representative must not have been sanctioned for violations within 2 years before the listing registration due to committing prohibited acts in securities and securities market activities as stipulated in Article 12 of the Securities Law.
- There must be a securities company advising on the listing registration, except where the listing registrant is a securities company.
In addition to the general provisions, to be listed on HOSE, an enterprise must also meet the following specific conditions:
- Charter Capital: At the time of registration, the enterprise must have a charter capital of at least VND 120 billion based on the audited financial statement.
- Time and Operational Conditions:
- The enterprise must have been operating for at least 2 years in the form of a Joint Stock Company.
- The operating results of the 2 years preceding the listing registration must have been profitable.
- The ROE at the nearest time to the listing registration must be at least 5%.
- The company must not have any overdue debts for more than 1 year by the time of the listing registration, and there must be no accumulated losses at the time of the listing registration.
- Shareholder Structure: At least 20% of the voting shares must be held by at least 300 shareholders who are not major shareholders.
- Other Listing Conditions:
- Major shareholders, and shareholders who are organizations or individuals, must commit to holding 100% of their shares for the first 6 months and 50% for the next 6 months. This excludes state-owned shares.
- All debts owed by members of the Board of Directors, the management board, the chief accountant, major shareholders, and related persons must be disclosed.
- The enterprise’s shares must have been traded on the Upcom trading floor for at least 2 years, except for organizations that have offered shares to the public or privatized enterprises.
- In the 2 years preceding the listing registration, the company and its legal representative must not have been sanctioned for violations related to prohibited securities trading activities.
- The listing registration dossier must comply with the regulations of the Ho Chi Minh Stock Exchange.
