Vietnam-based digital marketing firm Clever Group will trade its 7.4 million shares, under the ticker ADG, on UPCoM, a bourse for unlisted public companies operated by the Hanoi Stock Exchange.
The shares represent a charter capital of 74 billion dong ($3.2 million).
Clever Group did not provide further details on the UPCoM debut but a senior executive revealed that it planned to conduct an IPO and move to Ho Chi Minh City Stock Exchange by March 2020. Clever Group is also working on a reference price for the UPCoM trading, the executive said.
UPCoM is a trading bourse for unlisted companies to test investor appetite on the stock market. It does not require high financial reporting standards as public exchanges do.
In October 2018, DealStreetAsia reported that CleverAds – the entity before rebranding – would consider an IPO on the stock market.
Clever Group was founded in 2008 by local entrepreneur Nguyen Khanh Trinh. Japanese VC firm Cyberagent Capital and South Korea’s Yello Digital Marketing are two major foreign shareholders of the company, collectively holding 35 per cent.
Clever Group has capped its foreign ownership limit at 65 per cent.
Rebranded as Clever Group in 2019, the group currently comprises units including CleverAds, Clever Review, ADOP Vietnam, Adtech, Orion Media, NAH Media, and CleverNET.
Headquartered in Hanoi, Clever Group also has branches in Da Nang and Ho Chi Minh City, and subsidiaries in Indonesia and Myanmar.
Being a local premier agent for Google and Facebook, Clever Group has been profitable. In 2018, it earned 20.1 billion dong in after-tax profit, compared to 15.8 billion dong in 2017. The company expects a 34.17 per cent year-on-year increase in profit in 2019 and 54.94 per cent in 2020.
“The digital marketing space got more challenging in 2018 due to higher competition both from direct competitors and small, individual service providers,” Clever Group said in its listing brochure. However, it claimed that it has had a higher satisfaction ratio than the regional average in terms of Google Search and Google Adwords services, and a 15 per cent market share in Google Adwords solutions.
“Yello Digital Marketing has supported Clever Group not only in enhancing service quality but also in expansion into other markets in the region. In 2020, we will launch new products as well as invest in other businesses to widen our market share,” the company said, adding that it will also increase the charter capital to 120 billion dong after the listing.
The stock market in Vietnam has not been a viable fundraising channel for a lot of tech companies, as the startup ecosystem is still young compared to other countries. Apart from IT and telecom service provider FPT Group, which went public in 2006, it was only until 2018 that Vietnam saw another tech IPO.
Entertainment platform Yeah1, backed by VinaCapital-DFJ Fund, had its debut last year but it has not had a successful run with the stock price plunging from 300,000 on its first trading day in June 2018 to the current level of 37,500 .