The equitisation of State-owned enterprises (SOEs) in Vietnam is no longer seen merely as a way to expand the stock market and increase the number of listed companies, but as a strategic solution to improve corporate governance, enhance transparency and attract long-term international investment flows.

Chairwoman of the State Securities Commission of Vietnam Vu Thi Chan Phuong said that developing the capital market, particularly the stock market, has become a key policy priority as Vietnam pursues rapid and sustainable growth.

According to Phuong, the stock market is not only an effective medium- and long-term capital mobilisation channel for the economy, but also a tool to promote corporate transparency, improve governance standards, optimise social resource allocation and enhance national competitiveness.

Major policies have been introduced to strengthen the financial market and improve the role of SOEs. Notably, Politburo Resolution No.79-NQ/TW dated January 6, 2026 on State economic development requires SOEs to serve as the core force of the State economy, operate effectively under market principles and adopt modern, transparent governance standards with regional and international competitiveness.

Against this backdrop, accelerating equitisation and State capital divestment in tandem with stock market listing and trading registration is viewed not only as a legal requirement, but also as a way to improve governance quality, expand access to social capital and increase enterprise value.

Phuong noted that amid mounting pressure on bank credit growth, tighter risk control requirements and rising capital costs, the stock market’s role as a long-term capital channel has become increasingly important.

For large State corporations and groups, this is both an objective requirement and an opportunity to restructure capital sources, strengthen financial capacity and mobilise social resources for development investment. Enterprises can utilise various capital market instruments, including share issuance, corporate bonds, private placements for strategic investors and international fundraising through better governance and transparency.

“Large SOEs with stable operations and strong brands have significant advantages in enhancing corporate value, broadening investor bases and elevating their image to international standards through the stock market,” she said.

Market observers said the issue today is no longer simply adding more listed companies, but ensuring the market has enterprises with sufficient scale, liquidity and openness to absorb international capital flows.

Several large enterprises in sectors such as banking, aviation, dairy, energy and infrastructure have contributed significantly to market capitalisation growth after equitisation. However, many large-cap firms still have low free-float ratios, with most shares concentrated in the hands of the State or major shareholders.

As a result, actual circulating shares remain limited, market liquidity is weaker than expected and foreign institutional investors face constraints in deploying capital.

This is why reducing State ownership in sectors where controlling stakes are no longer necessary is considered a crucial measure to improve free-float and enhance market attractiveness. The orientation was first highlighted in Resolution No.12-NQ/TW in 2017 and reaffirmed in Resolution No.79-NQ/TW of the Party Central Committee.

Phuong said Vietnam’s stock market is entering a favourable development stage, especially after FTSE Russell upgraded the Vietnamese market to secondary emerging market status. The upgrade is expected to open opportunities for substantial foreign capital inflows, particularly from long-term and passive global investment funds.

However, she stressed that the market still needs to improve governance standards, enhance transparency and increase the number of stocks with sufficiently large free-float ratios to meet the requirements of international institutional investors.

“A good stock market requires quality products, and those products are the listed enterprises themselves,” she said, adding that the commission will continue working with international organisations in 2026 to organise corporate governance training programmes for listed and registered companies.

Deputy Director of the Department for State-owned Enterprise Development under the Ministry of Finance (MoF) Nguyen Thu Thuy said SOEs continue to play a leading role in strategic sectors such as energy, infrastructure, telecommunications, logistics and national defence-security.

Vietnam currently has more than 860 enterprises with State capital, including around 500 wholly State-owned enterprises. The sector contributes about 12.5% of GDP and 27-30% of total State budget revenue excluding crude oil.

However, Thuy said the SOE sector still faces six major challenges, including unclear leading roles, underutilised capital resources, limited competitiveness, inefficient operations, slow governance reform and sluggish equitisation and divestment progress.

For the 2026-2030 period, the MoF has proposed a new classification framework for SOEs, shifting from a comprehensive planning model to a mechanism focused on categorisation, decentralisation and accountability linked directly to capital efficiency.

Under the new approach, the State will determine sectors where dominant ownership is necessary and areas where ownership can be reduced, while enterprises will proactively formulate development strategies and capital restructuring plans in line with the Law on Management and Investment of State Capital in Enterprises and related decrees.

The new legal framework is also expected to remove bottlenecks in the equitisation process. Among notable regulations are Decree No.365/2025/ND-CP on supervision and information disclosure in State capital management and Decree No.57/2026/ND-CP on restructuring State capital at enterprises.

Chairwoman of the Vietnam Institute of Directors Ha Thu Thanh said the new decree demonstrates a clearer separation between the State’s ownership role and corporate governance and operations, enabling enterprises to operate more closely with market signals and become more attractive to investors.

A recent development drawing market attention is the plan of the Vietnam National Industry - Energy Group to continue reducing State ownership in Binh Son Refining and Petrochemical JSC and PV GAS. Analysts said the move reflects not only divestment efforts but also the need to improve governance and mobilise resources for energy, LNG and gas infrastructure investment.

According to Tyler Nguyen Manh Dung, Senior Director of Market Strategy Research at HSC Securities, foreign investors place strong emphasis on enterprise quality, asset quality and legal risk management when considering investment opportunities.

While SOEs possess advantages such as large scale, strong asset bases and stable operations in key industries, the valuation mechanism and legal risk management during equitisation and divestment processes still need further improvement to ensure greater transparency./.