REG - VietNam Holding Ltd - Monthly Investor Report

VietNam HoldingAnnouncement

20/06/2022 07:15

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RNS Number : 4365P  VietNam Holding Limited  20 June 2022

VietNam Holding Limited ("VNH" or the "Company")

Monthly Investor Report

A report detailing the activities of the Company for the month of May 2022 has
been issued by Dynam Capital Limited, the investment manager of the Company.
Electronic copies of the report have been made available to shareholders on
the Company's website
(https://www.vietnamholding.com/media/0gihdnf0/vnh-investor-report-may-2022.pdf)
 and a summary of the report is included below.

Manager Commentary - Made in Vietnam

Vietnam is fast becoming one of the main beneficiaries of shifting supply
chains and in recent months has increasingly shown how the government's 'open
for business' policies are paying off. In mid-May, Prime Minister Pham Minh
Chinh rang the closing bell of the New York Stock Exchange (NYSE), proving how
Vietnam has progressed its participation in the international capital markets
to help its companies further finance growth. As the government continues to
build on its economic story post-pandemic, by also focusing on improving
regulatory and legal frameworks, we see how the 'Made in Vietnam' theme is
making its mark on the global stage more than ever before. Later in May, Apple
announced that for the first time it is moving some iPad production out of
China and into Vietnam after strict Covid lockdowns in and around Shanghai led
to months of severe supply chain disruptions. With iPads now the second major
line of Apple products made in Vietnam, the announcement shined more light on
the country's expanding role in global trade and manufacturing. Companies,
such as Samsung and Intel, were some of the first foreign investors to help
make Vietnam one of the world's top exporters of electronics and in recent
years we have seen domestic brands add to that momentum. Now manufacturers
from all over the world are looking at Vietnam as part of their relocation
strategy to effectively diversify and reduce supply chain risks.

Unlike China, Vietnam has largely overcome the pandemic, having successfully
rolled out a vaccination programme following the hard-hitting Delta wave last
year. Speaking at the NYSE, Vietnam's Prime Minister emphasised the
government's commitment to supporting 'sustainable, law-abiding development'
as businesses move on from the Covid crisis. Legal action was taken again last
month to remove corrupt officials, showing how the government intends to crack
down on regulatory breaches that bruise the integrity and efficiency of its
markets. Meanwhile, the Asian Development Bank confirmed its growth forecasts
for Vietnam's economy: 6.5% in 2022 and 6.7% in 2023. As discussed in our
recent webinar, 'Vietnam's Prominent Role in the Global Supply Chain', the
country has not been as badly hit by higher fuel costs and increased
fertiliser prices as others because as a food producer it can feed itself and
export anything from fruit and vegetables to coffee. Fish and rice prices in
Vietnam have been unaffected by the war in Ukraine, for example, with the cost
of pork actually going down 20% due to a greater supply.

Although equities worldwide saw another bumpy month, given the escalating
inflationary concerns and tighter central bank policies, the Fund outperformed
the Vietnam All Shares (VNAS) index, falling by 6.3% vs the VNAS decline of
7.5%. Year-to-date the fund has outperformed the index by 6.7% due mainly to
overweight positions in ports & logistics, retail and telecoms (FPT).
There has been diverse performance among positions. Gemadept (GMD) and Hai An
Transport (HAH) were top positive contributors, having continued to benefit
from supply chain shifts and elevated freight costs. As almost all coronavirus
restrictions are now lifted in Vietnam, retailers also continued to recover
strongly with portfolio companies, Mobile World Investment Corporation (MWG)
and Phu Nhuan Jewelry (PNJ), expanding their businesses through the opening of
new stores. Despite 2022's nuances and difficult global risk environment, the
Fund has demonstrated outperformance over 1, 3, and 10 years. Our size means
we are nimble and able to take advantage of opportunities across small, medium
and large companies as industry shifts and cultural transformations unfold.
Valuations also have become more compelling following the correction in April
when domestic retail investors faced margin calls, and the fund has cash to
take advantage of this.  Indeed, over the past month we have seen evidence of
foreign flows returning to Vietnamese equities and expect long-term
performance of the market overall to strengthen as the country emerges from
the Covid era with increased resiliency, and renewed growth in consumption and
modern industrialisation. Looking ahead into the second half of the year, we
expect foreign direct investment to rise as well, particularly as travel
resumes and demand for infrastructure development grows.

For more information please contact:

Dynam Capital Limited

Craig
Martin
Tel: +84 28 3827 7590

 

info@dynamcapital.com (mailto:info@dynamcapital.com) |www.dynamcapital.com
(http://www.dynamcapital.com)

 

www.vietnamholding.com (http://www.vietnamholding.com/)

finnCap

Corporate Broker and Financial Advisor
                                 Tel: +44 20
7220 0500

William Marle

 

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