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VinFast: The Emergence of a Leading EV Maker

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VinFast, the Vietnamese electric-vehicle manufacturer, has successfully transitioned into a publicly traded company on the Nasdaq stock exchange. This achievement comes as a result of its merger with the special purpose acquisition company, Black Spade Acquisition (ticker: BSAQ).

With the completion of the merger, Black Spade Acquisition has now become VinFast. Consequently, the stock symbol has been changed from “BSAQ” to “VFS.”

The shareholders’ approval of the merger on Thursday triggered a surge of excitement among investors. Initially, Black Spade shares soared by 73% to reach $18.50 per share. However, they have experienced a subsequent decline of 43%. Presently, they sit 24 cents below their pre-merger value.

Investors must prepare themselves for potential fluctuations in trading. In pre-market trading on Tuesday, the stock, now trading as VFS, experienced a 7.5% increase. This positive momentum contrasts with the 0.6% and 0.7% declines in S&P 500 and Nasdaq Composite futures.

The reasons behind the tendency for traders to elevate SPAC-related stocks upon approval remain unclear. Although approval represents a crucial milestone in any SPAC merger process, it is relatively easy to discern which deals resonate favorably with investors. Consequently, it becomes evident which mergers are likely to receive approval.

The VinFast-Black Spade merger was met with considerable enthusiasm from investors. Its valuation estimated VinFast at approximately $23 billion, surpassing the market capitalization of EV startups such as Rivian Automotive (RIVN), Lucid (LCID), and Polestar Automotive (PSNY). These three companies have already garnered significant attention from investors.

At the closing price of $18.50 per share on Thursday, VinFast’s total valuation amounted to roughly $43 billion, which narrowly misses the market capitalization of General Motors (GM) standing at approximately $46 billion. This achievement solidifies VinFast’s prominent position within the EV industry.

Overall, the successful transformation of VinFast into a publicly traded company marks an important milestone. With its impressive valuation and potential for future growth, VinFast is primed to emerge as a leading player within the electric vehicle market.

VinFast Emerges as a Major Player in the EV Industry

The recent surge and subsequent volatility in VinFast’s stock price serves as a reminder of the early days of the SPAC boom. Similar to Nikola’s immense gains after its SPAC merger, VinFast experienced a significant increase in share value. On June 8, 2020, VinFast’s shares doubled, reaching $79.73 the following day. However, as of Monday, the stock closed at a mere $2.50. This rollercoaster ride highlights the challenges faced by companies attempting to establish successful electric vehicle (EV) businesses – challenges that were underestimated by investors.

Unlike many EV start-ups, VinFast stands out due to its impressive sales and manufacturing capacity. In April alone, the company delivered 3,800 EVs, showcasing its operational prowess. Furthermore, VinFast has successfully entered the U.S. market, with Americans purchasing 740 of its VF8 SUVs in the second quarter.

With a capacity to produce approximately 300,000 EVs annually, VinFast’s potential for growth is substantial. The company has also initiated the construction of a $2 billion manufacturing plant in North Carolina, which is projected to have an initial capacity of 150,000 vehicles per year.

Looking ahead to 2023, VinFast anticipates sales ranging between $1.8 billion and $2 billion. In comparison, other industry players such as Rivian, Lucid, and Polestar are predicted to achieve sales figures of $4.3 billion, $800 million, and $3.1 billion, respectively.

Now that VinFast has become listed in the U.S., investors can expect analysts to provide coverage on the stock and issue sales and earnings estimates. The market eagerly awaits positive projections for VinFast’s future performance. With a market capitalization of $23 billion, VinFast has firmly established itself as one of the most valuable EV franchises globally.

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