| HANOI, March 6
HANOI, March 6 Vietnamese private budget airline
VietJet's market capitalisation surpassed that of
state-owned Vietnam Airlines on Monday, only a week
after it was listed.
VietJet grabbed headlines with bikini-clad flight attendants
when it was launched in 2011 and its success on the Ho Chi Minh
stock exchange reflects its rapid ascent since.
It has become known in Vietnam as the "bikini airline" and
female crew do still wear them, but only on some flights.
Its market share is expected to top that of Vietnam Airlines
this year, a feat it has achieved by tapping into a fast-growing
economy and a young population starting to travel more.
VietJet shares hit 137,400 dong ($6.03) each, valuing it
at$1.8 billion, ahead of Vietnam Airlines at $1.7 billion.
On its first trading day VietJet was valued at $1.4 billion
and its rival, which listed in January, at $2.1
Growth in the Vietnamese market, which is one of the fastest
in Asia Pacific, and a relatively small free-float in VietJet
shares for retail investors, had driven the price of the shares,
VietJet's stock has a lower price-to-earnings (PE) ratio of
15.75 compared with 16.63 for Vietnam Airlines, Thomson Reuters
The CAPA Centre for Aviation has said that VietJet, which
currently commands 40 percent of Vietnam's domestic market, will
likely become the country's biggest domestic carrier this year.
Some analysts forecast VietJet shares will jump to more than
143,000 dong per share.
"(The) VietJet story just begins so investors still have a
lot of expectation on its shares," Nguyen Van Dung, manager of
the securities consulting department at Saigon Securities, said.
"But if from investing perspective, I will buy Vietnam
Airlines share as the firm has much potential to grow
sustainably in (the) long-term and the price now is very good to
buy," he added.
The listings of VietJet and Vietnam Airlines were part of
the government's push on privatisation to boost investment.
Vietnam, which is slowly opening up its domestic market amid
considerable investment interest, has completed several major
share sales and listings in recent months, including a $3.72
billion flotation of its top brewer Sabeco SAB.HM in which the
government owns nearly 90 percent.
(Editing by Alexander Smith)