VinFast Explores $60 Billion IPO

VinFast, a new and fast-growing Vietnamese electric car manufacturer, is exploring an IPO at a $60 billion valuation, according to Reuters.

The startup is a subsidiary of Vingroup, a giant Vietnamese conglomerate that was founded in 1993 in Ukraine by Vietnamese expatriate Phạm Nhật Vượng. Vượng arrived in Ukraine after attending college in the Soviet Union. He first opened a restaurant in Ukraine, and then an instant noodles business. From those humble beginnings, Vingroup has grown into a massive conglomerate that builds and operates everything from real estate to smartphones to hospitals to convience stores to software.

The VinFast automotive subsidiary of Vingroup is relatively new. The unit was founded in 2017 and launched its first car in 2019. In January, 2021, VinFast unveiled SUV models intended for the US and European market.

In response to the IPO rumors, VinFast released a statement:

“VinFast Trading and Production LLC refers to recent market rumors about a possible US listing. VinFast wishes to clarify that the company is considering various fund raising opportunities and investments, including but not limited to an equity investment, an initial public offering, a business combination with a special purpose acquisition company or other transactions. Any potential fundraising will be subject to different factors such as market conditions and the company will issue an appropriate announcement should any transaction be determined.”

The $60 billion rumored valuation would be greater than the current valuations of Ford ($48 billion) or Stellantis (€47 billion). It would be approximately the same as NIO’s valuation ($58 billion), and less than the present valuation of GM ($84 billion). Like everything else in the automotive industry and most of the world, VinFast’s projected valuation is an order of magnitude less than Tesla’s

TSLA
current valuation ($700 billion).

VinFast has published an investor presentation, which highlights their rapid progress, polished vehicle designs, and potential manufacturing capacity, although there’s no information about how many vehicles they’ve delivered so far.

Vingroup itself is publicly-traded on the Ho Chi Minh stock exchange. MarketWatch reports that Vingroup JSC has a market capitalization of 478 trillion Vietnamese dong, which equates to about $21 billion US dollars.

The $21 billion valuation of Vingroup, the parent company, would seem to be an upper bound for the valuation of VinFast, the subsidiary.