Hotel developers are now beginning to manage properties under their own brand names, setting off a new trend in Viet Nam's hospitality industry.
The Ocean Hospitality company, which has listed 100 million of its shares with the Ha Noi Stock Exchange, opened last Wednesday its new property, the US$35 million StarCity Hotel Sai Gon, on HCM City's Nguyen Van Troi Street.
Ha Van Tham, chairman of the Ocean Group that owns Ocean Hospitality, said this was the first hotel to bear the StarCity brandname, which the company has created specially for four-star hotels and resorts.
"Over the next two to three years, we will complete seven additional hotels under the StarCity brand in Ha Noi, Hoi An, Nha Trang and HCM City," said Tham, adding that the company would hold stakes of at least 75 per cent in these properties.
Four-star properties would be the focus of the company but other brand names would also be created for five-, three- and two-star properties, he said.
For instance, he said a resort in Hoi An would be co-branded Novotel StarCity. Novotel, a brand that belongs to the well-known hotel management firm Accor, will help OceanHopitality improve the skills of its staff.
The company has an ambitious plan to expand its brand to Japan and China and negotiations are underway with a Chinese partner for the purpose.
A vocational training centre is also in the pipeline to ensure supply of a qualified workforce not just for the company but the industry as a whole, but no further details have been released yet.
Property developer Vincom Corp has also launched its owned brand, Vinpearl. The first resort bearing this name has already begun operations in Nha Trang. This year three more will open in Da Nang, Hoi An and Nha Trang, the last one being a six-star hotel inside the Vinpearl Nha Trang resort, according to chairman Le Khac Hiep. With the three new developments, VinPearl hotels will have almost 1,000 rooms to offer. The group is developing several other properties, all of which will be placed under hotel management company VinPearl Land.
Initially Vincom had contracted with well-known international hotel management companies for Vinpearl Nha Trang. "We saw that only a few key positions were held by foreign experts and the majority of the staff were Vietnamese so we thought why not a management team of our own as we would have various projects around the country," chairman Le Khac Hiep said.
"And we achieved better performance with our hotel management arm Vinpearl Land, revealed via higher occupancy and guests' satisfaction," he said, noting that the company also targeted offering management services to hotel owned by other developers in the future.
Deputy general director Tran Hung Viet of SaigonTourist, a major holding company in the country's travel and hospitality market, said he also saw the value of a hotel chain under its own brand name and management.
However, he also noted that their major properties like Majestic, Rex and Continental in HCM City had a long history and would retain their names.
The company has been developing hotels and resorts around the country and all of them (mostly four-star) have the prefix "Sai Gon". Thus, the properties are called Saigon - Qui Nhon and Saigon HaLong and so on to make it a chain.
Currently SaigonTourist maintains a general department in charge of business, marketing and management. Viet said his company had a long-term plan to develop a hotel management affiliate, but not in the immediate future.
New stock market policy
Nguyen Son, head of the market development department under the State Securities Commission (SSC), sees 2011 as a year to work out and issue important policies to help the market's growth.
A decree on standards for listed companies is expected to come out this year, which will include a focus on capital. The minimum charter capital for a firm to list on the HCM City or Ha Noi bourse will be VND120 billion (US$6.15 million) and VND30 billion ($1.54 million) respectively, up from the current levels of VND80 billion ($4.1 million) and VND10 billion ($512,820).
Conditions will also be tightened for those wanting to list on the UPCoM (a trading bourse for public firms not yet meeting criteria to list at the HCM City and Ha Noi stock exchanges), according to the SSC official.
The commission was also considering the establishment of a fourth market, he said.
New regulations that links a company's initial public offering with listing that should be done no later than a year after the share sale are also expected this year.
These coming developments are targeted at improving the quality of listed securities as well as information disclosure by public companies.
The Government bond market's restructure will see less bond codes. Around 40 codes of small amounts and low liquidity Government bonds will be reduced to five as the State will buy back those that are going to expire or were issued in small amounts. Currently up to 500 bond types are available but no deals have been struck for around 100 of them. Several others were issued for less than VND100 billion ($5.13 million).
On overseas fund raising, the Government plans to issue regulations on share sales and listing outside Viet Nam by Vietnamese companies as well as listing of foreign firms in this country.
Securities companies will also face tightened regulations so that their competitiveness will be enhanced.
A minimum service fee will be set to prevent firms from lowering them to win customers.
The SSC will this year improve the securities depository registering system and the depository centre will monitor traders' accounts and deal with any abuse of their accounts.
There is an open question on when traders will be able to open different accounts and buy/sell the same securities on the same day, which is not sure to have a positive answer this year. The neighbouring Lao stock market opened last week, where investors may have more than one account and buy and sell the same securities in a day.
This year, several hundred companies are set to list on the three trading floors in the country.
Non-life insurers optimistic
The Ministry of Finance has set a 2011 growth target of 22-25 per cent for the non-life insurance market and many companies see the goal within their reach, according to the Dau Tu (Vietnam Investment Review) newspaper.
According to Bui Duc Song, general director of the SHB – Vinacomin Insurance Company (SVIC), his company is determined to earned a 26 per cent increase in premiums, 23 per cent rise in reinsurance premiums and 36 per cent increase in net profit. These will mean a VND350 billion ($17.95 million) turnover and around VND42 billion ($2.15) in net profit.
He said this year the company would focus on improving service quality and investment effectiveness rather than expanding market share, which would result in higher profit growth rates compared with that of turnover.
The PetroVietnam Insurance Company (PVI) expects a growth rate of more than 20 per cent this year with a turnover of VND5 trillion and pre-tax profit of VND450 billion ($23 million). It is among the leaders in a market shared by almost 30 companies. Its parent company PetroVietnam which has several dozen affiliates gives this insurance firm a big advantage.
MIC, a subsidiary of the Military Bank, has set its goals – VND600 billion ($30.77 million) in turnover and VND70 billion ($3.59 million) in gross profit, up from 2010's VND500 billion ($25.64 million) and VND65 billion ($3.33 million) respectively. It also plans to push up its charter capital to improve financial capacity and widen network for better tapping the market.
BIC, the insurance company established by the Bank for Investment and Development and equitised late last year, wants to increase its 2011 turnover to VND1 trillion from 2010's 800 billion ($41 million).
Chairman Pham Quang Tung said he would focus on improving operation mechanisms to increase the profit on turnover ratio, speed up sales via the bank's network and invest in online sale channel.
Source: vnagency.com.vn
