DNSE Executives Address Shareholders at Annual General Meeting, Outlining Business Objectives and Strategic Plans
Key Business Target for 2024
In response to shareholders’ inquiries regarding business performance in the first quarter and plans to achieve the challenging business target set for 2024, DNSE executives provided insights into the company’s strategic direction.
Q1 2024 Financial Performance and IPO Progress
DNSE anticipates achieving approximately 70 billion VND in net profit for the first quarter, representing 85% of its business plan under the base scenario. In terms of market share, DNSE maintained its position among the top performers in new account openings, capturing over 30% of the total market share. This resulted in a significant increase in the company’s Assets Under Management (AUM). Notably, the number of clients with assets exceeding 1 billion VND grew by 30%, while those with an average NAV of 100 million VND or more also saw an increase of over 30%.
Regarding the listing of DSE shares, DNSE has submitted an application to the Ho Chi Minh City Stock Exchange (HOSE) and expects to complete the process by June at the latest.
Capital Raising Plans
Following its recent initial public offering (IPO), DNSE intends to optimize its existing equity capital of 4,200 billion VND and has no immediate plans for further capital raising. Additionally, DNSE is establishing a framework for partners to provide investment capital to investors on its platform, which is expected to improve the company’s capital utilization and efficiency compared to traditional securities companies.
Investment Plans
DNSE plans to allocate 10% of the capital raised through its IPO to infrastructure investments, divided into two areas:
Infrastructure to Enhance Order Execution Speed: DNSE aims to reduce its order execution time to 5-8 milliseconds, compared to the current 10 milliseconds for derivatives and underlying assets.
Data Redundancy Center: To mitigate risks associated with unforeseen events such as fires or natural disasters, DNSE will establish a backup data center.
Moreover, the company will focus on implementing AI (Artificial Intelligence) strategies to gain a competitive edge.
Phái Sinh (Derivatives) Market Outlook
DNSE’s core focus for 2024 is on the derivatives market, where it has ranked among the top 5 in market share within its first year of operation. To maintain its position, the company relies on its robust trading platform and zero-commission policy. DNSE believes its derivatives platform offers a superior and user-friendly experience, and plans to launch a specialized derivatives platform for end-customers in Q4.
The company is confident that its ranking will improve post-IPO and with the implementation of the zero-commission policy. The low churn rate among investors who trade derivatives on DNSE, at nearly 0%, is a testament to the product’s potential.
Fixed Income Market and Technology Products
Despite low interest rates, fixed income products remain attractive to investors. DNSE plans to develop tools to expand its fixed income investment channels in Q4 2024 or Q1 2025.
In terms of technology-driven products, DNSE’s virtual assistant Ensa and the Senses stock analysis and rating platform have received positive feedback from investors. Ensa provides high-quality advice and insights, while Senses helps investors evaluate investment opportunities.
Cybersecurity Enhancements
DNSE emphasizes the importance of cybersecurity and has partnered with a Canadian firm to manage and improve its security protocols. Two-factor authentication is implemented for investors, and data is secured at FPT’s data center with redundant backups. The company is also creating a unique data record that cannot be modified, ensuring the integrity of its data and the continuity of its 24/7 trading services.
Furthermore, DNSE’s infrastructure deployment platform is 98% automated, which is unique among securities companies. While cybersecurity breaches cannot be entirely ruled out, DNSE is committed to minimizing the impact on its customers and aims to restore services within 4-8 hours in the event of a disruption.
KRX Implementation Progress
DNSE has completed all Exchange tests and is prepared to migrate to the new trading system, which will support high-frequency trading. The company has also begun to implement advanced products that will be launched when KRX becomes operational across the market.
Mr. Nguyen Hoang Giang, Chairman of DNSE, addressing shareholders at the meeting
DNSE shares a plan to focus on derivatives in 2024, and has already entered the top 5 in market share in Q1. What plans does the company have to maintain its current market share?
Mr. Nguyen Hoang Giang, Chairman of DNSE: DNSE competes based on a solid trading platform and a zero-trading-fee policy. We are confident that DNSE’s derivatives trading platform is distinctive and user-friendly. In our new product roadmap, DNSE will build a specialized derivatives platform for end-customers this Q4.
DNSE is a new name, having just completed one year in the derivatives market, so clients need time to familiarize themselves with the platform and experience its optimized features. Along with the listing on HoSE and the zero-trading-fee policy, boosting our derivatives market share will be faster. We are most delighted that investors who have traded derivatives on DNSE stay with us. The churn rate is almost 0%. This is a positive sign, demonstrating the product’s potential. In a short period of time, DNSE has reached the top 5 in derivatives market share, despite the increasingly competitive market environment.
Question from a major shareholder (PYN Elite Fund): What is DNSE’s assessment of the attractiveness of high-yield bonds? And could you please share the results of the implementation of the company’s pioneering technology products, Senses and Ensa?
Mr. Nguyen Hoang Giang, Chairman of DNSE: Bond products remain very attractive to investors in a low-interest-rate environment. However, high yields will depend on the repayment capacity of the issuing organization. In the recent past, issuers have focused more on issuing listed bonds or private bonds.
Investor demand is always present, and in Q4/2023, the State Securities Commission (SSC) requested that securities companies adjust their capital mobilization operations. This is a positive move that will open up better bond investment opportunities for investors. Therefore, DNSE plans to develop tools to expand its bond investment channels sometime in Q4/2024 or Q1/2025.
Regarding our technology-driven products, the Ensa virtual assistant and the Senses stock analysis and rating platform are features that continually provide high-quality advice to investors, offering a broader and deeper perspective on the market and stocks. Although they were recently launched, the proportion of investors who regularly consult the Ensa virtual assistant on a daily basis is currently around 13-15%. Most DNSE investors use Senses as a tool to evaluate investment options.
Following the incident involving the VnDirect Securities Company, what steps has DNSE taken to enhance the security of its technology systems?
Mr. Nguyen Hoang Giang, Chairman of DNSE: This is a top priority for DNSE. We are currently working with a Canadian partner to manage and enhance our security measures. DNSE has implemented two-factor authentication for investors, secured our data center at FPT’s data facility, and established a data backup platform. We are also maintaining a unique, uneditable version of our data. These security and backup measures aim to protect our commitment to providing a 24/7 trading service. Additionally, we need to safeguard our data to maintain our AI product.
DNSE’s infrastructure deployment platform is different from that of other securities companies because it is 98% automated. No one can claim to be immune to hacking indefinitely, but we hope that in the event of a system failure, DNSE’s platform can recover and restore services in the shortest possible time, between 4 and 8 hours. Our goal is to minimize the impact on our clients’ experience so that they are hardly aware of any problems that may have occurred.
Could you please share the company’s progress in preparing for the KRX implementation?
Ms. Pham Thi Thanh Hoa, Member of DNSE’s Board of Directors, responding to shareholders at the meeting
Ms. Pham Thi Thanh Hoa, Member of DNSE’s Board of Directors: DNSE has completed and passed all Exchange tests and is ready to
