A bunch of water spinach or a few shares? Take your pick, for they cost the same.
The shares of some companies listed on stock exchanges in Ho Chi Minh City and Hanoi are being traded at VND2,000 and VND3,000 each. Nearly 50 percent of the 668 shares listed on the bourses are changing hands at below their par value of VND10,000.
With high inflation and restrictions on lending to non-manufacturing sectors, the pall of gloom that hangs heavy above Vietnam's stock markets is unlikely to be dispelled in the short-term, analysts say.
The stock market is "facing difficulties" because of high inflation, Vu Bang, chairman of the State Securities Commission, said at the Vietnam Business Forum in Hanoi last Friday.
Vietnam's consumer prices rose 19.78 percent in May from a year earlier, the most since December 2008, according to the General Statistics Office. Experts say inflation may accelerate to more than 20 percent this year.
Brokerages in Vietnam have offered loans to their investors for trading stocks on a large scale though the country is yet to issue legal documents allowing such activity. As of March 31, outstanding debts at securities firms stood at nearly VND11.2 billion (US$546 million), newswire VnEconomy reported on May 4.
Most of the loans came from commercial banks. With the looming June 30 deadline for capping credit to non-production sectors at 22 percent of their total loans, banks have been pressurizing securities firms to repay the loans.
As a result, brokerages can no longer wait for investors to give the additional money to offset the fall in value of their collateral assets. Instead brokers are just selling the shares, making the market fall further.
In the latest draft circular on the operations of securities firms, the State Securities Commission has proposed brokerages be banned from lending customers money to buy stocks.
"This is definitely not good news for brokers," said Fiachra Mac Cana, head of research at the Ho Chi Minh City Securities Corp.
He said the June 30 deadline suggests that "residual bank lending exposure to the stock market will be further curtailed."
"As a result, the market is likely to test down to recent lows again over the coming weeks albeit at a more gradual pace this time," he said in a statement dated May 30.
VietCapital Securities agreed with Mac Cana, noting that the VN-Index may fall to as low as 370 in the coming time. The brokerage also said long-term investors may find it an opportunity to accumulate at bargain prices.
The VN-Index gained 3.42 percent to close at 450.59 on Thursday as investor confidence in the local currency revived after the central bank lifted dollar reserve ratios and ordered state-owned companies to sell foreign currency.
Vietnam's benchmark stock index has tumbled 14 percent from the 2011 high on February 9. The HNX-Index of the smaller bourse in Hanoi fell 35.2 percent this year.
As for recent advances, analyst Phan Thi Phuong Chi of ACB Securities, said, "With the lack of strong investment inflows and positive macro-economic news, the recent gaining sessions were technically just corrective sessions. It is common for the market to post gains after several consecutive declining sessions, but it is not really a recovery."
Many securities companies have narrowed their business activities, mostly by closing down branches as they struggle with the stock market decline.
Hanoi-based Viet Star Securities Corp. closed its HCMC branch on May 23. Earlier that month, VietinBank Securities, ACB Securities, and Vina Securities made similar moves.
Even Thang Long Securities, which currently holds the largest share of the brokering sector, closed one of its six transaction offices in Hanoi.
"As the market is in crisis, every brokerage has to find ways to survive," news website VnExpress quoted Pham Duc Thang, general director of Kenanga Vietnam Securities, as saying late last month. "And cutting costs is the top priority."
In recent days, both bourses have regularly announced high-level personnel changes at securities firms. The bearish market has driven general directors, deputy general directors and other senior executives to quit their jobs in droves.
Brokers have followed suit as the stagnant trading are drying up their commissions, say securities companies.
Telecom firm SaigonTel has announced plans to terminate its listing on the Ho Chi Minh Stock Exchange.
The stock market has lost its appeal as it is no longer a good channel to help companies raise funds, Dang Thanh Tam, chairman of SaigonTel, said in late April, explaining the decision to delist, although a time frame was not specified.
Many listed companies have recently announced their buyback plans in order to "snap up stocks at attractive prices".
For example, Refrigeration Electrical Engineering JSC (REE) has registered to buy back five million shares between June 1 and September 1. Ben Tre Aquaproduct Import and Export JSC (ABT) has unveiled a plan to buy back 1.36 million shares between June 3 and August 3.
Nguyen Quang Quyen, head of investment at REE, told the Dau Tu Chung Khoan (Securities Investment) newspaper, "We purchase shares not because we want to prevent them from falling further. The point is that prices of REE shares are very good to buy as they are lower than their book value at the moment."
Top executives of some listed businesses have also registered to increase their holdings, citing similar reasons.
Doan Nguyen Duc, Chairman of Hoang Anh Gia Lai Group, and other senior executives have announced their plans to buy a total of 5.1 million HAG shares from May to July.
Sacombank Securities' leaders followed suit by registering to purchase 1.2 million shares in total between May and June.
The Vietnam Association of Financial Investors (VAFI) and the Vietnam Association of Securities Business (VASB) said last week they have sent a request to the finance ministry seeking approval to have the tax payment deadline extended for stock investors.
In fact, at a meeting with the National Assembly's Finance and Budget Committee on May 6, the ministry submitted a proposal under which stock market players would be exempt from the 5 percent tax rate on dividends and the 0.1 percent tax on each transaction. But the proposal was rejected.
The VAFI, a group of companies and banks, and the VASB, a group of brokerages, urged the ministry to try again, saying these measures were essential to "save the stock market" now.
The two associations also proposed a 50-percent cut in membership fees which securities companies have to pay the Hanoi and HCMC stock exchanges. This slash can be approved by the finance ministry on its own.