The national economy has been facing great challenges,
the stock market has been witnessing stock prices decrease
dramatically. However, these things have not dissuaded some enterprises
from offering shockingly high dividends.


Unbelievably high dividends


Hancic, an investment and construction company in
Hanoi, has announced it will pay the dividend of 550% (VND55,000/share)
for 2008.


Eximbank has announced the 2008 dividend of 82.55%, including 12% to be paid in cash, and 70.55% in shares.


A lot of medium-size enterprises have also announced
relatively high cash dividends for 2008. Nhi Hiep Company (NHC), a
brick and tile producer, has decided to pay the dividend of 30%, not
including bonus shares; Phu Thinh Garment Company (NPS) 40%; Cuu Long
An Giang Import-Export Company (ALC) 35%. The list of companies
offering the dividends of 10-20% has become longer, and more
enterprises are paying dividends in cash than in shares.


Meanwhile, some enterprises have announced low
dividends, and some have decided to cancel paying dividends. Pha Lai
Thermopower Plant has announced a delay in the payment of dividends
because of low profit.


Shareholders of Bach Tuyet Cotton Company do not hope
they will get dividends in 2008 as the company still has unpaid debts
of tens of billion VND.


Huy Nam, a securities expert, said that it is not a
surprise that some enterprises will not pay dividends in 2008. He said
that shareholders should be comforted by the knowledge that the leading
automobile manufacturer in the world, GM, has also announced it will
delay paying dividends.


Risks forecast


Obviously, what most shareholders want are dividends
in cash after they had a bad business year in 2008 due to the gloomy
stock market.


Pham Linh, Deputy General Director of VIS Securities
Company, said that if the dividends are as high as 15-20%, while the
prices of many share items have dropped to below VND20,000/share, the
profit for shareholders proves to be much more attractive than bank
deposit interest and other investment channels.


The director of a foreign investment fund has
expressed his surprise that Vietnamese companies, which have had worse
results in 2008 than in 2007, are paying higher dividends than in 2007.


Dr Le Tham Duong from the HCM City Banking University
said that high dividends may make shareholders happy, but enterprises
should be cautious in the context of the global economic crisis and
continuing difficulties of the national economy.


According to Vincom securities company, the financial
reports of Q3 of many listed companies show debt/equity ratios higher
than 150%; however, some have still decided to pay dividends of more
than 15% in cash. This could result in the enterprises having to access
expensive capital sources if they find themselves short, which would
mean their profit would significantly drop later.