Brokerage revenue falls at most securities companies amid market contraction

A man looks at stock indices on a computer screen (Photo: VNA)

Brokerage revenue fell at most securities companies amid the general market contraction as the total trading size of the whole market shrank.

Statistics from HoSE showed that 10 securities companies with the largest brokerage value on HoSE in the fourth quarter of 2022 include VPS Securities JSC (VPS), SSI Securities Inc (SSI), VNDirect Securities Co (VNDirect), Mirae Asset Securities (MAS), Ho Chi Minh City Securities Corporation (HSC), Vietcombank Securities Co (VCSC), MB Securities Co (MBS), Techcombank Securities Co (TCBS), KIS Vietnam Securities Corporation (KIS), and Viet Dragon Securities Co (VDSC).

VPS Securities JSC (VPS) continued to maintain the No 1 position in terms of stock brokerage market share with 14.81% in the last quarter of 2022. That was the 8th consecutive quarter VPS reached the No 1 market share position on the HCM Stock Exchange (HoSE), although this figure was nearly 4 percentage points lower than 18.71% in the third quarter of 2022.

On the Hanoi Stock Exchange (HNX), VPS securities also hold the leading position in 2022 with a market share of more than 21%.

While other companies listed in the top 10 stockbrokers on the HNX improved their market share insignificantly, or even witnessed a shrinking market share, VPS's market share increased by nearly 5 percentage points from 16.34% in 2021.

Securities companies such as SSI Securities Inc (SSI) and VNDirect Securities Co (VND) also improved their market share on the HNX in 2021, increasing by 0.14 and 0.12 percentage points, respectively.

Missing out of the Top 10 on HNX were 2 companies HCM City Securities Corporation (HSC) and Saigon-Hanoi Securities Co (SHS), replaced by 2 companies KB Securities Vietnam JSC (KBS) and Vietcombank Securities Co (VCSC) with market shares of 3.12% and 2.76%, respectively.

Brokerage revenue fell at most securities companies amid the general market contraction. For example, VPS became the No 1 securities company in terms of market share on HoSE, but its market share in the fourth quarter of 2022 decreased sharply. In the whole of 2022, VPS Securities Joint Stock Company - the leading company in terms of stock brokerage market share - only collected 550 billion VND in revenue from brokerage activities, equal to half of the same period of 2021.

For the whole of 2022, brokerage revenue of the 10 leading securities companies on HoSE in terms of trading market share decreased by nearly 19.4% compared to the previous year. VPS's brokerage gross profit margin decreased from 22% in the fourth quarter of 2021 to 12% in the fourth quarter of 2022.

Keeping market share when the total trading size of the whole market shrinks, many securities companies trade off efficiency. The ratio of gross profit to revenue of the brokerage segment has decreased significantly.

In the top 10 enterprises leading the market share, brokerage revenue decreased by less than 20%, but gross profit of this segment decreased by 28.2%./.