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Shares of VinFast surge once more as interest in the Vietnamese EV manufacturer increases.

(Qnnflash) – The shares of VinFast, the Vietnamese electric vehicle manufacturer that recently made its debut on Wall Street, experienced a remarkable surge in value once again on Tuesday.

The stock had a significant increase in value in the New York market, surging by 109% and reaching a closing price of $36.7. This surge was mostly driven by the enthusiasm of individual investors who were discussing the prospects of the emerging automaker. The favorable market performance may potentially facilitate VinFast’s ability to secure further funding from investors, a strategic consideration that CEO Thuy Le has acknowledged.

Last week, an analogous narrative unfolded as VinFast commenced trading on the Nasdaq stock exchange. The company had a significant increase in its share value, exceeding 250%, so surpassing the market capitalization of larger automotive manufacturers, at least in theoretical terms. The current valuation of the corporation exceeds $85 billion, surpassing that of industry giants like Volkswagen or Ford, despite its comparatively limited automobile production volume.

The public trading of VinFast (VFS) exhibits low trading volumes, amounting to about 1% of the total shares available. Consequently, this limited liquidity contributes to heightened price volatility within the market. The remaining 99% of the company’s ownership is under the control of its creator, Pham Nhat Vuong, who holds the distinction of being Vietnam’s wealthiest individual.

However, it is possible that this situation may undergo a transformation in the near future.

When queried on Wednesday regarding the company’s intentions to secure additional funds or issue additional shares, Le responded by stating, “We are actively investigating potential avenues for subsequent transactions, and I expect that we will be able to execute them within the forthcoming months.”

A significant portion of the shares will be released from lockup within the upcoming six to twelve months, hence augmenting market liquidity.

Le expressed her team’s enthusiasm and noted that they were pleasantly taken aback by the positive reception from the industry. She further stated that they believe the market acknowledges their competence.

In the year 2022, VinFast achieved a global automobile sales figure of 24,000 units, which represents a significantly smaller proportion compared to the sales volumes achieved by industry giants such as the Volkswagen Group and Ford. Specifically, the Volkswagen Group recorded sales of 8.3 million cars, while Ford sold 4.2 million vehicles over the same period.

The firm, which has been in operation for six years, has not yet achieved profitability. It reported a loss of $1.4 billion for the nine-month period ending in September of the previous year. Furthermore, the company is still in the initial stages of expanding its operations on an international scale.

The relatively unimpressive historical performance does not appear to be dissuading stock traders. VinFast emerged as one of the prominent firms and garnered significant attention as a highly monitored company on Stocktwits, a social media platform catering to the investment community, during the course of Tuesday.

On Tuesday, it was observed that the corporation received significant support from its parent company, Vingroup, which is considerably greater in size. Additionally, the conglomerate’s chairman, Pham, who possesses billionaire status, has pledged a total of $2.5 billion in support.

She expressed that the mentioned strategy will enable the company to reach the point of covering costs and ultimately achieving a state of generating profit.

VinFast possesses ambitious aspirations on a worldwide scale. In the month of July, the company initiated construction on a novel manufacturing facility located in North Carolina, with the intention of utilizing it as a central hub for sales operations throughout the United States. The company has had a lukewarm reaction in that market, as seen by a recent influx of negative evaluations pertaining to their electric SUV, the VF 8.

The company has also hinted at an upcoming expansion into the European market, informing shareholders of its intention to join the region in the near future. On Tuesday, Le underlined its intentions to expand its operations, expressing its interest in pursuing further market entries in Asia and the Middle East. She remarked that there are numerous tasks or challenges that lie ahead of us.

When questioned about the rationale behind the company’s decision to enter the United States market, where it faces formidable competitors like Tesla (TSLA), Le affirmed that this was indeed the primary motivation.

The United States presents a highly complex and demanding market, as highlighted by her observation. If we are able to achieve success in that particular location, we have the potential to establish and promote our brand in any other location.

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