Mandatory delisting of stocks, what should investors pay attention to?

DNVN - According to the Department of Securities Market Development - State Securities Commission, to avoid the risk of losing investment capital when shares are forced to delist, investors need to clearly understand the regulations related to forced delisting of shares. At the same time, equip yourself with knowledge and understanding of the stock market and be careful in choosing investments.

The Securities Market Development Department - State Securities Commission (SSC) believes that the regulation on compulsory delisting of shares on the stock market (TTCK) in necessary cases is of great significance. It contributes to creating a fair and transparent investment environment.

Understanding the regulations related to compulsory delisting of shares will help investors make more accurate investment decisions. This process is in accordance with the provisions of Clause 1, Article 120 of Decree No. 155/2020/ND-CP dated December 31, 2020 of the Government detailing the implementation of a number of articles of the Securities Law (Decree No. 155/2020/ND-CP).

In order to give early warning to investors about potential risks that may lead to delisting of shares, the Regulations on listing and trading of listed securities issued under Decision No. 17/QD-HDTV of the Board of Members, Vietnam Stock Exchange has issued regulations on cases of stocks being warned, controlled, restricted, and suspended from trading.

For example, a public company's shares will be delisted when "its production and business results are losses for three consecutive years". Previously, the stock exchange would put a public company's shares on warning when "the undistributed profit after tax in the audited annual financial report of the listed organization is negative" or under control when "the profit after tax in the audited financial report of the listed organization in the last two years is negative".

Investors need to clearly understand the regulations related to compulsory delisting of shares to avoid risks.

The decisions of the stock exchange to put stocks on warning, control, restriction, suspension, or trading suspension are widely announced to the entire market. Therefore, investors can fully grasp information about which stocks are likely to be delisted in the future.

After the shares of a public company are delisted, but still meet the conditions of being a public company, according to the provisions of Clause 2, Article 120 of Decree No. 155/2020/ND-CP, the public company must register for trading on the trading system for unlisted securities organized by the Hanoi Stock Exchange (UPCoM).

Therefore, in these cases, investors can still trade stocks on the UPCoM floor. In addition, according to Article 122 of Decree No. 155/2020/ND-CP, an organization whose shares are delisted by force or voluntary, after at least 2 years of trading on the UPCoM system, that organization can re-register for listing on the stock exchange if it fully meets the listing conditions.

To avoid the risk of losing investment capital when shares are forced to be delisted, the Securities Market Development Department recommends that investors need to clearly understand the regulations related to forced delisting of shares. It is necessary to equip themselves with knowledge and understanding of the stock market, financial foundation, reputation and prospects of listed companies.

At the same time, it is necessary to be careful in choosing to invest in stocks of listed companies. Consider the ability of listed companies to comply with the law in general and the securities law in particular.

“Investors also need to pay attention to constantly updating all information about stocks and financial reports of enterprises. From there, they can quickly grasp and evaluate the quality of stocks and make investment decisions more accurately,” the Securities Market Development Department recommends.

Galaxy

Source: https://doanhnghiepvn.vn/kinh-te/chung-khoan/huy-niem-yet-bat-buoc-co-phieu-nha-dau-tu-can-luu-y-gi/20240816054631440