Passengers disembark a VietJet Air aircraft, operated by VietJet Aviation Joint Stock Co., at Tan Son Nhat International Airport in Ho Chi Minh City, Vietnam, on Monday, Jan. 9, 2017. VietJet, the Vietnam carrier known for its bikini-clad flight attendants, expects profit to surge 30 percent this year on rising passengers as it prepares for its Ho Chi Minh City Stock Exchange listing debut in February. Photographer: Linh Luong Thai/Bloomberg
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Shares in VietJet, the fast-growing Vietnamese low-cost airline, jumped one-fifth on their debut in Ho Chi Minh City in the country’s largest initial public offering.

The company’s stock on Tuesday rose by the debut day limit of 20 per cent from its listing price of 90,000 dong to 108,000 Vietnamese dong ($4.74).

Its $167m IPO, which valued the carrier at more than $1bn, was Vietnam’s biggest. It was the third-largest listing for a Vietnamese company following those in London by Indochina Capital Group and JSM Indochina in 2007, according to Dealogic data.

Andy Ho, VinaCapital’s managing director and chief investment officer, said he expected the company to achieve earnings growth of more than 50 per cent this year. Vietnam’s economy has returned to growth rates of more than 6 per cent a year, although worries remain about areas ranging from banking sector governance to state company debts.

VietJet posted net profits last year of VND2.40tn ($105m) on revenues of VND27.53tn ($1.21bn).

The airline last year delayed an international IPO in either Singapore or Hong Kong in what would have been the first overseas initial public offering for a Vietnamese company. The country’s laws require companies to first list locally.

The low-cost airline is headed by majority owner and founder Nguyen Thi Phuong Thao, a property and banking tycoon. Ms Thao has previously outlined hopes that the airline would mimic the success of Tony Fernandes’ AirAsia and Rusdi Kirana’s Lion Air.

VietJet last year placed an $11.3bn order for 100 Boeing 737 aircraft as well as ordering 20 Airbus A321s to replace its leased fleet — the latest gambit by an Asian airline to tap into the region’s fast-expanding tourism and business travel markets.

The deal to buy the Boeing 737 Max 200 jets was signed during former US President Barack Obama’s trip to communist Vietnam, highlighting the growing commercial ties between the two countries.

VietJet has in the past not shied away from publicity — using a promotional video featuring bikini-clad flight attendants dancing in the aisle of the inaugural flight to the coastal town of Nha Trang. The airline was fined by Vietnam’s aviation watchdog over the stunt.

After launching its first commercial flight in late 2011, the low-cost airline has taken advantage of growing demand for air travel among the region’s emerging middle class.

VietJet carried 14m passengers last year, up from 9.3m in 2015, after putting on domestic and international routes to Asian destinations such as Singapore and Hong Kong.

VietJet said BNP Paribas, Deutsche Bank and JPMorgan were the IPO’s foreign joint global consultants. It added that 24 international investors subscribed to the offering, including GIC, the Singapore state wealth fund, Wellington, Morgan Stanley and Vietnam’s Dragon Capital and VinaCapital.

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