India Queen Basmati Rice
India Queen Basmati Rice

Rice Exporter Companies like An Giang Import-Export Company (AGM) and Vinh Long Cereal and Food Corporation (VLF), may delist from the stock market if the losses they are facing being continue, Dau Tu Chung Khoan (Securities Investment) magazine reported yesterday.

Last Year, AGM could make a profit of VND 5 billion (US$238,000), just 20.83 per cent of its yearly goal and a 83.87 per cent drop from 2013. While VLF was in loss of VND 38.5 billion ($1.83 million) last quarter and a yearly loss of VND 47 billion ($2.24 million).

Both the companies had taken a risky fiscal move by taking large loans on small equities. AGM borrowed VND339 billion ($16.1 million) when its equity was VND345 billion ($16.4 million). VLF borrowed VND231 billion ($11 million) with an equity of just VND92 billion ($4.38 million).

Another rice exporter company, Dong Thap Trading Corporation (FDG) had already been delisted from  the HCM City Stock Exchange last May after its losses exceeds its charted capital. In 2014, FDG recorded revenues of VND300 billion ($14.3 million), one-third of 2013’s number.

This year, along with these three rice exporters, many others could face delisting challenges as Thailand has set its Sale target at 17 million tons in 2017.

Vietnam Food Association(VFA) has blamed the losses on falling global rice prices.VFA reported that prices for Vietnam  five-per-cent broken rice was US$439 per tonne last year, higher than comparable rice in Thailand.

At the moment, the VLF stock is marked as a Designated Security on the HCM City stock market.

AGM this year set an optimistic revenue target of VND2.24 trillion ($106.6 million), an increase of 27 per cent, and a net profit of VND 23.3 billion ($1.1 million), nearly 5 times  last year’s number

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