INTRODUCTION ABOUT THE SELECTED COMPANIES FINANCIAL MANAGEMENT 2 ASSIGNMENT OCTOBER 2020

HUTECH INSTITUTE OF INTERNATIONAL EDUCATION

_____________________________________________________________________________

FINANCIAL MANAGEMENT 2
ASSIGNMENT
OCTOBER 2020
_____________________________________________________________________________

FULL NAME:

PHAN THI NHU MY

CLASS:

18BOBA01

STUDENT ID:

181401017

EMAIL:



LECTURER:

NGUYEN THI MINH THUY


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Table of Contents
I.

INTRODUCTION ABOUT THE SELECTED COMPANIES................................................3
1. Binh Minh Plastic joint stock company................................................................................3
2. COMECO joint stock company............................................................................................4

II. COMPUTATION OF COMPANIES’ DIVIDEND PAYOUT..................................................6
1. Binh Minh Plastic joint stock company................................................................................6
2. COMECO joint stock company............................................................................................9
III.

FACTORS AFFECTING ENTERPRISE'S DIVIDEND POLICY....................................12

1. Definition of dividend.........................................................................................................12
2. Factors affecting dividend payment policy.........................................................................13
IV.

ANALYSIS OF THE COMPANIES’ DIVIDEND PAYOUT............................................14

1. Dividend policies of Binh Minh Plastic joint stock company............................................14
2. Dividend policies of COMECO joint stock company........................................................16
V. EVALUATION OF THE COMPANIES’ DIVIDEND PAYOUT..........................................16
1. Binh Minh Plastic joint stock company..............................................................................16
2. COMECO joint stock company..........................................................................................18

VI.

SUMMARY........................................................................................................................19

References......................................................................................................................................20

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INTRODUCTION ABOUT THE SELECTED COMPANIES

1. Binh Minh Plastic joint stock company
Binh Minh Plastic joint-stock company is a company specializing in manufacturing and
distributing plastic pipes such as PVC-U pipes and fittings, pipes used in plumbing systems,
pipes, and fittings of HDPE, PP pipes. -R, agricultural sprays, etc. The head office is located at
240 Hau Giang, Ward 9, District 6, HCMC. The contact phone is 02839690973. Website address

Image 1. Logo of Binh Minh Plastic joint
stock company
(, 2020)

Binh Minh Plastic Factory was established on November 16, 1977, under the model of publicprivate partnership on the basis of merging Vietnam Chemical Plastic Pipe Company (KEPIVI)
and Kieu Tinh Plastic Company. The factory specializes in manufacturing all kinds of civil

plastic products and some plastic pipe products with fittings. In 1990, Officially registered for
exclusive protection of trademark, trademark, and logo of Binh Minh Plastic in Vietnam. After
the equitization process, the company officially operated under the name of Binh Minh Plastic
Joint Stock Company on January 2, 2004. This is an extremely important milestone marking a
fundamental change in the Company's operating mechanism. In 2006, the Company's shares
were officially traded on the HOSE with the stock code BMP. In 2013, the Certificate of
conformity for products according to the regulations of the Ministry of Construction, increased
charter capital to VND 454,784,800,000. In 2017, completing the conversion of the new ecofriendly additive system and launching a new product line of PP-R spare parts. Currently, the
market capitalization of Binh Minh Plastic Company is over 818 billion VND. The product
distribution system has about 1890 stores in Vietnam.

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Vision: maintain its position as the leading enterprise in the plastic building materials industry in
Vietnam. proactively improve capacity and spirit to be ready to compete in the region and
internationally.
Mission: To supply products and services to meet the growing needs of the market. ensure the
harmonization of interests of customers, employees, shareholders, and society.
Core value: high consensus - respect for the past - strong present - confidence in the future.90
stores which are widely distributed throughout the country of Vietnam.
2. COMECO joint stock company
PETRO Vietnam joint-stock company (COMECO) operates mainly in the petroleum and oil
business, in addition to fuel supply services, car wash services, petrol pump cylinder business,

construction of civil and industrial projects, office for lease, premises, warehouse, etc. The head
office is located at COMECO Building Floor, 549 Dien Bien Phu, Ward 3, District 3, Ho Chi
Minh

City.

Phone

(84-28)

3832

1111,

Fax:

(84-28)

3832

5555,

Email:

, Hotline: (84-28) 38 300 222.

Image 2. Logo of COMECO joint stock company
(comeco.vn,2020)

On December 13, 1975, COMECO was born, formerly known as the Petroleum Management

Department under the Department of Transport of the City. At that time, COMECO was in
charge of managing petrol stations and supplying fuel for more than 5,000 public passenger and
freight vehicles in Ho Chi Minh City. In 2000, COMECO was chosen by the City People's
Committee to develop the enterprise equitization project. COMECO has built a solid foundation
for development, becoming a strong brand in the petroleum business, the average growth rate
after 15 years of equitization of the enterprise is over 24%/year. The charter capital of the
Company has increased from VND 16.2 billion in 2000 and now has increased to VND 141,206

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billion. The Company's shares have been listed on the Ho Chi Minh City Stock Exchange since
the beginning of August 2006 under the code COM. At present, COMECO has 38 petroleum
branches in Ho Chi Minh City and neighboring provinces such as Long An, Ben Tre, Binh
Duong, Dong Nai, Lam Dong.
Vision: Developing COMECO brand name is of service quality, leading to service quality in
petrochemical business in Vietnam. Improve service quality, satisfy customers' needs. At the
same time, to upgrade the infrastructure and invest in developing the petroleum retail network.
Diversifying business lines and developing added value for customers
Mission: Training and coaching employees to create a difference to increase competition in
business; developing COMECO Culture and Brand. Preserve and develop capital. Interested in
the interests of customers, suppliers, shareholders, employees, and the community, society.

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COMPUTATION OF COMPANIES’ DIVIDEND PAYOUT

1. Binh Minh Plastic joint stock company

Revenue

Billion VND

2016
3,678

2017
4,057

2018

Cost of good

Billion VND

2,248

2,902

3,048

sold
Gross profit
Net income
Equity
Profit available

Billion VND
Billion VND
Billion VND
Billion VND

1,061
627
2,297
528

923
465
2,449
418

872
428
2,454
428

4,130

to ordinary
shareholders
Number of

Share

45,478,480

81,860,93

81,960,938

ordinary share
Market price

VND

191,000

8
85,600

52,600

per share
Book value of

VND

44,965

24,981

24,973

share

Table 1. The changes in the growth of Binh Minh Plastic joint stock company from 2016 to 2018
2016
Earnings per share=

Stock price=

887,000,000,000
Net income
=
=13,787 VND
Number of ordinary share
45,478,480

2,297,000,000,000
Equity
=
=51,000VND
Number of ordinary share
45,478,480

Profit available
528,000,000,000
¿
=
=11,610 VND
Dividend per share=¿ ordinary share
Number of ordinary share
45,478,480
Stockholder value pershare=Stock price +Dividend pershare=51,000 + 11,610=62,610 VND
2017

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Earnings per share=

Stock price=

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Net income
465,000,000,000 =5,680 VND
=
81,860,938
Number of ordinary share

2,449,000,000,000

Equity
=
=30,000VND
Number of ordinary share
81,860,938

Profit available
418,000,000,000
¿
=
=5,106 VND
Dividend per share=¿ ordinary share
Number of ordinary share
81,860,938
Stockholder value pershare=Stock price +Dividend pershare=30,000 + 5,106 =35,106 VND
2018
Earnings per share=

Stock price=

428,000,000,000
Net income
=
=5,228 VND
Number of ordinary share
81,960,938

Equity
2,454,000,000,000 =29,998 VND
=

81,960,938
Number of ordinary share

Profit available
428,000,000,000
¿
Dividend per share=¿ ordinary share
=
=5,228 VND
Number of ordinary share
81,960,938
Stockholder value pershare=Stock price +Dividend pershare=29,998 + 5,228 =35,226 VND

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Dividend payout of Binh Minh Plastic Joint Stock Company
from 2016 to 2018
70,000
62,610
60,000
51,000
50,000
40,000

30,000

35,106
30,000

35,226
29,998

5,680
5,106

5,228

2017

2018

20,000
13,787
11,610
10,000
0
2016
Dividend pershare
Stock price

Earning pershare
Stockholder value pershare

In general, we can see a clear difference in dividend ratios between 2016-2017 and 2017-2018 of

Binh Minh Plastic JSC. Looking at the chart, it can be seen that the period 2016-2017 has a
strong decline between the indices, when 2016 is of very high value but almost halves in 2017.
The period 2017-2018 is not much the volatility, it can be said that these indices are not
significantly different.
First, the change of earning per share, in 2016 earning per share is 13,787VND, but in 2017 this
value is only 5,680VND, down 8,107VND, approximately 58.8% over the previous year.
Second, dividend per share also showed signs of a sharp decline from 11,610 VND in 2016 to
5,106VND in 2017, a difference of 6,504VND or more than 56%. Next, in 2016, the stock price
is 51,000VND, but only 30,000VND, down 21,000VND, that is more than 41% compared to the
previous year. Finally, the stockholder value per share also fell similarly due to the decline in
stock price and dividend per share, namely VND 62,610 in 2016 and VND 35,106 in 2017, a
decline of VND27,504 by 44%.
The reason for the strong volatility of stock indices during 2016-2017 is mainly due to the
change in the number of ordinary shares. In 2017, Binh Minh Plastic Joint Stock Company
announced a resolution on issuing bonus shares to increase charter capital from equity. Binh
Minh Plastic Company will issue approximately 36.4 million additional shares to existing

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shareholders at the ratio of 10:8. After the issuance, the company's charter capital will increase
from VND 455 billion to about VND 819 billion. This increase in charter helps enterprises have
more potentials for business capital, bringing more opportunities in business activities. At the
end of 2016, the State Capital Investment Corporation SCIC had a plan to divest, causing BMP's

stock to increase continuously, then the stock price gradually decreased when SCIC did not
divest at the end of 2017. 2018 is also the year that recorded a significant change for Binh Minh
Plastics when the State Capital Investment Corporation (SCIC) sold the state capital to The
Nawaplastic Industries Group (Saraburi) of Thailand. In 2018, Saraburi continued to buy more
shares in Binh Minh Plastic to increase his holding to 54.39% of the company's capital, and at
the same time introduced staff to key positions of the company in which Mr. Sakchai
Patiparnpreechavud is Binh Minh Plastic President. This event also affects stock volatility but
not by much. BMP's business results in 2017 with net revenue of VND 3,825 billion, an increase
of 10% but profit before tax and net profit decreased by 25%, to VND 627 billion and VND 465
billion due to cost of goods sold and expenses sales soar.
2. COMECO joint stock company

Sale

Billion VND

2016
3,471

Cost of good sold
Gross profit
Net income
Equity
Profit available to

Billion VND
Billion VND
Billion VND
Billion VND
Billion VND

3,186
285
110
425
84

3,837

2018
4,242

3,560
277
95
467
57

265
90
503
42

71

ordinary
shareholders
Number

2017

of Share

14,120,628

14,120,628

14,120,628

ordinary share
Market price per VND

47,4

59,7

57,5

30,122

33,051

35,645

share
Book

value

of VND

share
Table 2. The changes in growth of COMECO joint stock company from 2016 to 2018
2016

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Earnings per share=

Stock price=

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Net income
110,000,000,000 =7,790 VND
=
14,120,628
Number of ordinary share

425,000,000,000
Equity
=
=30,098 VND
Number of ordinary share
14,120,628

Profit available
84,000,000,000
¿
=
=5,940 VND
Dividend per share=¿ ordinary share
Number of ordinary share
14,120,628
Stockholder value pershare=Stock price + Dividend pershare=30,098 + 5,940 =36,038 VND
2017
Earnings per share=

Stock price=

95,000,000,000
Net income
=
=6,728 VND
Number of ordinary share
14,120,628

Equity
467,000,000,000 =33,072 VND
=
14,120,628
Number of ordinary share

Profit available
57,000,000,000
¿

Dividend per share=¿ ordinary share
=
=4,037 VND
Number of ordinary share
14,120,628
Stockholder value pershare=Stock price +Dividend pershare=33,072 + 4,037=37,109 VND
2018
Earnings per share=

Stock price=

90,000,000,000
Net income
=
=6,374 VND
Number of ordinary share
14,120,628

503,000,000,000
Equity
=
=35,622VND
Number of ordinary share
14,120,628

Profit available
42,000,000,000
¿
Dividend per share=¿ ordinary share
=2,974 VND

=
14,120,628
Number of ordinary share
Stockholder value pershare=Stock price +Dividend pershare=35,622 + 2,974 =38,596 VND

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Dividend payout of COMECO Joint Stock Company
from 2016 to 2019
45,000
40,000
37,109

36,038
35,000

38,596
35,622

33,072
30,098
30,000
25,000

20,000
15,000
10,000
7,790
5,940
5,000

7,728
4,037

0
2016

2017
Dividend pershare
Stock price

6,374
2,974
2018

Earning pershare
Stockholder value pershare

In general, stock indices of COMECO Joint Stock Company do not have a strong transformation
in 2016, 2017, and 2018. Stock price and stockholder value per share show signs of increasing
over the years, in contrast, earnings per share decreased slightly and dividend per share
decreased and then increased again.
More specifically, dividend per share fluctuated slightly when 2016 reached 5,940 VND but in
2017 decreased to 4,037 VND by 32% compared to the previous year, to 2018 continued to

decrease to 2,974VND, about 50% lower than 2,966VND. compared to 2016 and about 26%
lower than 1063VND, about 26% compared to 2017. The reason for this uneven fluctuation is
that the dividend paid each year is different base on company’s operating activities, 2018 is the
lowest because the business keeps the account retain earnings for other investment activities.
Earning per share value decreased steadily over the years, in 2016 was 7,790 VND, in 2017
decreased to 7,728 VND, about 0.8% lower than 62 VND compared to the previous year, this
decrease was also negligible. However, it is reduced more in 2018, earning per share is
6,374VND, about 17% lower than 1,354VND compared to 2017, 1,416VND lower,
approximately 18% compared to 2016. This decline is directly affected by the Net income
because the Net Income decreases steadily from 2016 to 2018. Although the revenue of the

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company COMECO is increasing in the years 2016, 2017, 2018. In these years, the company's
business activities are growing but Increasing market fees leads to a decrease in net income.
Although other values fluctuate, the stock price has steadily increased over the years.
Specifically, in 2016 the stock price was 30,098VND, in 2017 the stock price was 33,072VND,
up 2,974VND, nearly 9% over the previous year. Continuing to 2018 the stock price is
35,622VND, about 16% higher than that of 2016, 2,250VND about 7% higher than in 2017. The
reason why the stock price increased steadily from 2016 to 2018 is due to COMECO's equity
increased during this period. In addition, in 2018, Comeco sets a target of 3,800 billion VNd in
revenue and 45 billion VND in profit after tax. As a result, in the first 9 months of 2018,
COMECO reached 3,169 billion VND in revenue, up 12% over the same period. The profit after

tax reached 65 billion VND, exceeding 44% of the profit target assigned for the whole year.
Before the news of high dividend payment, COMECO's share price rose sharply at the end of
2018, at a time of trading at 59,500 VND/share.
Similar to the stock price, stockholder value per share also shows signs of increase, especially in
the period of 2017-2018. In 2016, this value was 36,038VND. In 2017, it was 37,109VND, about
2.9% higher than in 2016. In 2018, the stockholder value per share continued to increase to
38,596VND, the difference was 1,487VND about 4% compared to 2017, about 7% higher than
2,558VND. Compared to 2016. Since the stockholder value per share is the value dependent on
dividend per share and stock price, the stakeholder value per share also increases when these two
values increase, but the stockholder value per share increases here mainly because the stock price
increases steadily for years.
III.

FACTORS AFFECTING ENTERPRISE'S DIVIDEND POLICY
1. Definition of dividend

The dividend is the company's after-tax profit paid to current shareholders.
Dividends can be paid to shareholders in various forms, such as in cash, in shares, or by property.
The selection of different forms of dividends has certain effects on the book value of shares,
company value, and investment capital.

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For a joint-stock company, the Board of Directors will decide the rate and method of dividend
payment based on business results and the dividend policy that the General Meeting of
Shareholders has approved.
2. Factors affecting dividend payment policy
Legal provisions: Dividend distribution must comply with certain legal regulations.
Needs to repay loans: If the company has used a lot of long-term debt to invest, it is necessary to
retain a lot of profits to prepare for debt repayment.
Investment opportunities: If a company has investment opportunities that promise high growth
potential, the company tends to keep most of its net profits reinvested.
The company's capital return: If the company has a higher capital return than other companies,
shareholders tend to want to leave the majority of net profits for reinvestment and vice versa.
The stability of the company's profit: If the company has a relatively stable profit margin or is
sure to increase in the future, the company can spend most of its net profit to pay dividend and
vice versa.
Cash Flow: Paying dividends means an outflow of cash. Firms only claim high dividends when
they have a cash balance. In the face of a lack of cash, the company claims no or very low
dividends.
The ability to penetrate the capital market: Large companies, with a long operation time,
relatively stable profits, high reputation often have the ability to easily mobilize capital in the
financial market. So these companies can spend a high percentage of their profit after tax to pay
dividends and vice versa.
Growth opportunity: If a company has some investment plan then it should reinvest the
company's income. To invest in investment projects a company has two options, one to raise
more capital or invest in its retained earnings. Withholded income is a cheaper source because
they have nothing to do with the cost of converting assets and any legal proceedings.
Trends of the economy: During the economic recession, there are few investment opportunities,
the market interest rates drop. If the company has a need for capital, can easily borrow large

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amounts of money with low interest rates, then the company can spend most of its net profits to
pay dividends and vice versa
Control of the company: If the shareholders of the Company want to maintain management and
control over the Company, they often retain a large portion of their net profits for reinvestment
and vice versa.
Personal income tax: Because personal income tax is usually taxed on progressive tax rates or
there is a difference in tax rates between dividends and capital gains, many companies use such
differences to determine the dividend payment.
IV.

ANALYSIS OF THE COMPANIES’ DIVIDEND PAYOUT
1. Dividend policies of Binh Minh Plastic joint stock company

Based on the Resolution of the Annual General Meeting of Shareholders 2016 of Binh Minh
Plastic joint-stock company, the Board of Directors decided to pay dividends in cash at the rate
of 20%, ie 2,000 VND per share, par value The price is 10,000VND. Binh Minh Plastic has
approved the 2016 cash dividend payment, at the rate of 40%. The Company has advanced the
1st installment at the rate of 20% in January 2017, the remaining 20% will be paid out in June
2017.
Pursuant to the Resolution of the 2017 Annual General Meeting of Shareholders of Binh Minh
Plastic joint-stock company, the Board of Directors decided to effectively issue shares to increase
share capital from equity at the rate of 18:10, ie a shareholder owning 10 shares according to the
list will receive 8 new shares. The issuance method is as follows:

Stock type: common stock
Par value of shares: 10,000VND / share
Stock code: BMP
Number of additional shares: 36,382,784 shares
Value of shares calculated at par value: 363,827,840 VND

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2016

2017

COMMON STOCK
RETAINED EARNING
NUMBER
OF

454,784,800,000
99,000,000,000
45,478,480

18 FOR 10 STOCK SPLIT
454,775,704,300

99,000,000,000
81,861,264

OUTSTANDING SHARES
PAR VALUE
BOOK
VALUE

10,000
44,965

5,556
24,981

191,000

106,112

8,686,389,680,000

8,686,389,680,000

PERSHARE
MARKET

VALUE

PERSHARE
TOTAL MARKET VALUE

Number of new share=45,478,480×

Change∈par vallue=10,000 ×

18
=81,861,264
10

10
=5,556
18

Change∈common stock= (5,556 × 81,861,264 )−45,478,480=454,775,704,300
Change∈book value pershare=44,965×

10
=24,981
18

Change∈market value pershare=191,000×

10
=106,112
18

Based on the meeting minutes of the Board of Directors in October 2017, the decision to pay the
2017 first cash dividend is 15%/Charter capital, 1,500VND/share, par value is 10,000VND.
Second dividend payment of 2017 in cash at the rate of 25%, VND 2,500/share, par value of
VND 10,000.
Interim first dividend 15% /Chater capital in cash for 2018, 1,500VND per share, with a par

value of a share 10,000VND. The time of payment is in December 2018. Payment of the first
two-year dividend of 2018 in cash at the rate of 25%, 2,500 VND/share.

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2. Dividend policies of COMECO joint stock company
According to the resolution of the General Meeting of Shareholders in 2016, the decision to pay
the first cash dividend of 2016 is 10%/charter capital. In December 2016, the decision to pay
2016 second cash dividend is 40%/Charter capital, 4,000/share. With more than 14.12 million
shares outstanding, COMECO will spend about 56 (84) billion in cash on this dividend payment.
According to the resolution of the General Meeting of Shareholders 2017, the decision to pay the
first cash dividend of 2016 is 10%, 1,000VND/share, par value is 10,000VND. In December
2017, the decision to pay cash dividend was 20%/Charter capital, 2,000VND / share. In February
2018, COMECO continued to pay a third dividend of 20% / share capital, 2,000VND / share. In
2017, COMECO has made 3 dividend payments with a total rate of 50%, far exceeding the plan
of 15%. With the number of outstanding shares, COMECO company spends about 57 billion
VND for the 2017 dividend.
According to the resolution of the General Meeting of Shareholders in 2018, the decision to pay
the first dividend of 2018 is 10%, 1,000 VND/share. In January 2019, paying 40% cash dividend
in 2/2018, 4,000VND/share. In 2018, COMECO spent about 42 billion VND for a total rate of
50%.
V.

EVALUATION OF THE COMPANIES’ DIVIDEND PAYOUT

1. Binh Minh Plastic joint stock company
Dividend policy is one of the most important decisions in any joint-stock company to both
achieve business efficiency and fulfill the obligations of the organization. That is why the
decision to pay dividends is recognized as of paramount importance.
The change in dividend payment is understood as a signal to shareholders and investors about the
company's future earnings prospects. In general, the increase in dividend payments is seen as a
positive signal, transmitting positive information about a company's future earnings prospects
leading to an increase in stock prices and subsequently the owner's assets. Ownership becomes
bigger. Conversely, a decrease in dividend payments is considered a negative signal of future
earnings prospects, leading to a decline in stock prices and investor wealth.

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Binh Minh Plastic joint-stock company has a decision to pay dividends in the form of shares by
taking advantage of profits of the current and past years. This is a combination of profit
distribution and capital mobilization of the company. Shareholders can not receive cash, but
shares, from which they may receive interest on capital in the future. There is essentially no
change in the shareholders' equity, many companies that pay stock dividends can avoid paying
taxes until the stock is actually sold. Shareholders will receive a specific number of additional
shares from the company based on the number of shareholders already owned.
In 2017, Binh Minh Plastic joint-stock company issued more than 36 thousand shares, split stock

at the rate of 18:10, which means that a shareholder owning 10 shares will receive 8 additional
shares, totaling 18 shares promissory note. The purpose of issuing additional shares is to increase
the charter capital of the enterprise. After the issuance, the company's charter capital will
increase from VND 455 billion to about VND 819 billion. That is, in 2017, shareholders will not
be allowed to pay cash dividends but instead will be a form of the stock dividend. The equivalent
amount of dividend will be considered as the investment capital added by the owner to the
business, transferred from the dividend paid account to the Charter Capital account, the
shareholder does not have to pay cash for the investment. Along with that, the number of shares
of shareholders will increase, leading to an increase in the profitability of shareholders, because
these shares can bring shareholders a high value of profits in the future from the business
activities of the company. In addition, the increase in charter capital makes the enterprise value
increase, contributing to the increase in stock prices in the market, shareholders can receive a
large profit due to the price difference from the sale of shares. Next, receiving dividends in
shares instead of cash helps shareholders to reduce personal income tax, if the income is over
VND 600 million, it can pay tax up to 30%. Paying stock dividends also helps businesses save
on stock issuance costs. Cash flow out of the company is limited, and shareholders also receive
dividends by converting retained earnings into equity. Paying stock dividends helps businesses
reduce borrowing costs, helps shareholders save some kinds of costs, thereby increasing
shareholders' assets.
However, paying stock dividends will cause the number of outstanding shares of Binh Minh
Plastic joint stock company to increase, which may decrease stock price as financial ratios such
as EPS will decrease in Short-term.

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2. COMECO joint stock company
Companies paying high dividends are often seen by investors with good prospects and vice
versa. Therefore, the dividend policy has more impact on stock value.
Shareholders may receive cash dividends on the current accounting period or may also want to
keep them to invest in future projects of a company that they find highly profitable. Dividends
are used by management to maintain a certain amount of income for shareholders in a company
and to maintain stock prices in the stock market. It will provide tangible evidence of a company's
ability to generate cash. An increase in share price can lead to an increase in shareholder wealth
and vice versa. The majority of shareholders do not like risk, they prefer to pay dividends in cash
rather than an interest in the future. Because, "a bird in the hand is worth two in the bush"
(Naveed, Bilal, Relman, & Abu Ttalib, 2013). Investors have a preference for a certain level of
income now rather than the imagination of a higher level of income, but less certain at some
point in the future.
COMECO's dividend policy is stable, does not cause sudden changes in the dividend policy,
leading to the avoidance of the long-term effects of such changes on the company's value. On the
one hand, dividends are current and certain income, on the other hand, dividend policy can
minimize expenses when income reaches shareholders since real income can be reduced due to
weaknesses factors such as income tax, transaction costs. In fact, some investors are very fond of
companies with dividend policies that create a steady, reliable cash flow and they are willing to
pay a premium for holding these shares. However, "being too stable" can also lead to a business
ignoring good investment opportunities, increasing the value of the company in the future. In the
case that COMECO does not want to ignore investment opportunities, enterprises will have to
borrow, meaning there is an increase in financial risks, the problem of controlling the change
after a period of stable operation is not at all. easily. Realizing that COMECO's dividend policy
is safe but does not mean paying a low dividend. Low dividend policy while an efficient
company will increase the retained earnings rate, if the accumulated cash fund is too large, it will
create the thought that the company is deadlocked in investing to continue growth. At the same
time, it creates risks for investors if the business operates and uses maintenance capital

ineffectively, causing investors to lose the profits that should have been received earlier. Firms

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that keep the cash but fail to invest effectively can waste capital. Next, COMECO's dividend
policy is reasonable when the dividend ratio satisfies shareholders' needs in having a stable and
sustainable cash flow in the long term but also ensures a billion. The retained earnings ratio is
enough to fund projects that create sustainable growth for the company.
If dividends are distributed at a high rate compared to income per share (EPS) that the company
makes. At that time, from the investor's perspective, the level of risk will be low because
shareholders receive dividends and will realize assets from the dividends, which reduces the
required rate of return of investors. investment causes stock prices to go up. But on the other
hand, because profits are devoted to the distribution of dividends to existing shareholders, the
company is forced to give up potential investment opportunities, causing the rate of future
dividend growth to decrease and will decrease. stock price. If dividends are distributed at a low
rate to income per share (EPS). From the investor's perspective, the level of risk will be high and
accordingly, the required rate of return will be higher, resulting in lower stock prices, but in
return, due to reinvesting profits, the rate increases. In the future, the dividend growth of the
shareholder will be high, causing the cash flow of the shareholder to increase and increase the
share price.

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SUMMARY

In recent years, the decline in economic growth due to the impact of the global economic crisis
has made Vietnam's stock market more volatile, especially since stock prices that have erratic
changes. The stock price is an issue that many investors and society are very concerned about, is
the most important issue for businesses. To add value to the business, ensuring the business
operates at a loss-free and highly profitable business, managers must make important long-term
business and financial decisions with the goal of maximizing. Enterprise value. Therefore, the
improvement of corporate value through the most influential factor, the dividend policy, is of
great significance to companies listed on the stock market of Vietnam. Dividend policy is one of
the important decisions affecting company value and performance. Dividend policy is a policy
that determines how much profit after tax of an enterprise will be distributed, how many percent
will be retained for reinvestment and dividend payment to shareholders. The dividend policy will
affect the amount of equity in the company's capital structure (through retained earnings) and the
firm's cost of capital. The dividend payment policy may be affected by factors such as legal,
investment opportunities, liabilities, business performance during the year, taxes, etc. In fact,
through the process of research, it was found that these factors affecting companies on the HOSE
were Binh Minh Plastic joint-stock company and COMECO joint-stock company. These factors
influence the decision on how many percent to pay dividends, to pay dividends in cash or in
stock. In 2017, Binh Minh Company decided to pay dividends to shareholders in the form of
shares with stock splits 18:10. This approach helps increase charter capital for the business,
increase the number of shares for shareholders, reduce personal income tax for shareholders, can

generate greater profits in the future. COMECO's side has implemented a stable and firm cash
dividend payment policy. Create a stable source of income for shareholders who own stocks,
reduce risks for shareholders and the whole business, create peace of mind for corporate
dividends.

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References
Borad, S. B. (2019, August 31). Factors affecting Dividend Policy. Retrieved from
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/>Financial Report. (2017). Retrieved from COMECO:
/>Financial Report. (2018). Retrieved from BinhMinhPlastic:
/>Financial Report. (2018). Retrieved from COMECO:
/>Introduction. (2020). Retrieved from BinhMinhPlastic:
/>Introduction. (2020). Retrieved from COMECO: />Kiều, N. M. (2012, February 13). Chính sách cổ tức. Retrieved from bvsc.com:
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