REG - VietNam Holding Ltd - Monthly Investor Report

VietNam HoldingAnnouncement

17/07/2023 07:45

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RNS Number : 2055G  VietNam Holding Limited  17 July 2023

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

Monthly Investor Report

A report detailing the activities of the Company for the month of June 2023
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/lpino0pi/vnh-investor-report-june.pdf)
 and a summary of the report is included below.

Manager Commentary - Birds-eye view on Vietnam

While Vietnam's economy continued to feel the effects of dampening global
demand in June, internal risk reduced further and investment - both public and
foreign - helped see it grow 4.1% in Q2 compared to 3.3% in Q1.

 

Exports and imports growth, though still down YoY in June, recovered MoM. The
retail sales upbeat streak continued thanks to healthy domestic consumption
and even stronger tourism, and the total number of tourist arrivals in Vietnam
surged to 5.6m in 1H 2023, the equivalent to 66% of the number over the same
period in 2019.

 

June also saw the Fund's NAV go up, +5.2%, due to its outperformance of banks,
industrials, and financials. VNH benefited from its overweight in selective
banks and financial firms, but also from already being underweighted in the
underperforming real estate sector. During the month, we trimmed some
positions in industrial goods and services, and increased our exposure to the
financial sector in the shape of brokerages, given improvements in business
prospects that the concerted effort of policy makers is helping to shape in
this sector. Consumer stocks delivered some of their biggest negative
surprises in earnings in H1 2023 and their share prices were punished as a
result.

 

Calendar year-to-date, the Fund's NAV is up 13.3% and we think the long-term
structural growth opportunity remains exceptionally compelling in Vietnam with
many major infrastructure projects, further development of its financial
system and the challenge of raising US$ 135bn to fund energy transition from
coal and hydro to renewable by 2030. Vietnam's policy and diplomatic relations
have continued to cushion the impact on dwindling exports and production, and
we expect Vietnam to maintain a trade surplus in 2023 despite the slower than
usual growth for the manufacturing sector. Easing monetary policies by the
State Bank of Vietnam in 1H 2023 also continue to mitigate ripple effects of
the crisis in the corporate bond market, which has lifted domestic investors'
appetite for equities.

 

Additionally, a steady flow of foreign direct investment (FDI) has been
maintained. This is in part due to issues with Chinese trade but also due to
strategic trade agreements. For example, in April 2023, the UAE agreed to
start talks on establishing a comprehensive economic partnership agreement
(CEPA), as the two countries seek to promote collaboration in trade,
investment, economy, industry, energy, logistics, agriculture and
infrastructure. More recently, Japan - Vietnam's largest investor to date,
according to the Asian Development Bank - signed three exchange documents
related to loans with a total value of nearly US$ 440m at the G7 Summit in
Hiroshima.

 

Rapid digitalisation, including adoption of generative AI, means business
models everywhere are changing fast, and Vietnamese companies are no
exception. Cloud computing has become a key driver of the country's digital
transformation and high growth rate relative to other countries.

 

A recent article in The Economist rated Vietnam's education system one of the
best in the world in terms of quality, ongoing improvement, and gender
equality. It cited the latest data from the World Bank on aggregate learning
scores, which showed that Vietnamese students not only outperform their
counterparts in neighboring Malaysia and Thailand, but also from the UK and
Canada, countries more than six times richer. The article concluded: "All this
has reaped rich rewards. As schools have improved, so has Vietnam's economy."

 

 

 

 

 

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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