REG - VietNam Holding Ltd - Annual Report
01/10/2025 07:00
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RNS Number : 5073B VietNam Holding Limited 01 October 2025
VIETNAM HOLDING LIMITED
("VNH" or the "Company")
(a non-cellular company limited by shares registered in Guernsey under the
Companies (Guernsey) Law, 2008, on 25 February 2019 with registered number
66090)
The Board of VietNam Holding Limited is pleased to announce its 2025 Annual
Report and Financial Statements.
More information on the Company is available at www.vietnamholding.com (http://www.vietnamholding.com)
Investment Manager - Dynam Capital, Ltd.
Craig Martin Tel.: +84 28 3827 7590
Corporate Broker - Cavendish Capital Markets Limited
Trading: Johnny Hewitson Tel: +44 20 7220 0558
Sales: Pauline Tribe Tel: +44 20 3772 4697
Corporate Finance: Tunga Chiovanyika Tel: +44 20 7397 1915
Company secretary & Administrator - Apex Fund and Corporate Services
(Guernsey) Limited
Michael Mabaso-Mlilo Tel: +44 20 3530 3158
The information contained within the announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(UK MAR) (Assimilated Law). Upon the publication of this announcement via
Regulatory Information Service ("RIS"), this inside information is now
considered to be in the public domain.
Contents
Strategic Report
Highlights 1
Summary Information 1
Chairman's Statement 4
Investment Manager's Report 6
Top Five Portfolio Companies 10
Sustainability Report 20
Business & Human Rights Report 26
Principal Risks and Risk Management 28
Governance
Director Profiles and Disclosure of Directorships 31
Corporate Governance Report 32
Audit and Risk Committee Report 38
Directors' Remuneration Policy and Report 40
Directors' Report 41
Statement of Directors' Responsibilities 45
Financial Statements
Independent Auditor's Report 46
Statement of Financial Position 51
Statement of Comprehensive Income 52
Statement of Changes in Equity 53
Statement of Cash Flows 54
Notes to the Financial Statements 55
Alternative Performance Measures 70
Corporate Information 71
Highlights
Financial Highlights
30 June 2025 30 June 2024
Total Net Assets (USD) 117.6 million 140.2 million
Net Asset Value per share (USD) 5.004 5.137
Net Asset Value per share (GBP) 406.4p 406.4p
Share price 338.0p 396.0p
Discount to Net Asset Value 7.4% 2.6%
As at 26 September 2025 (the latest available date before approval of the
accounts), the discount to NAV had moved to -10.5%. The estimated NAV per
share and mid-market share price at 26 September 2025 was 437.80 p and 392.0 p
respectively.
Ongoing Charges
Ongoing charges for the year ended 30 June 2025 have been calculated in
accordance with the Association of Investment Companies (the "AIC")
recommended methodology. The ongoing charges for the year ended 30 June 2025
were 3.04% (2.97% as at 30 June 2024). Refer to page 70 for the definitions of
Alternative Performance Measures ("APMs") together with how they have been
calculated.
Summary Information
The Company
VietNam Holding Limited (the "Company", the "Fund" or "VNH") is a closed-end
investment company that was incorporated in the Cayman Islands on 20 April
2006 as an exempted company with limited liability under registration number
166182. On 25 February 2019, the Company, via a process of cross-border
continuance, transferred its legal domicile from the Cayman Islands to
Guernsey and was registered as a closed-ended company limited by shares
incorporated in Guernsey with registered number 66090. The shares were
admitted to trading on AIM in June 2006 and admitted to the Main Market
(previously the Premium segment of the Official List) and admitted to trading
in the Main Market of the London Stock Exchange on 8 March 2019. The Company
also listed on the Official List of The International Stock Exchange on 8
March 2019. The Company has an unlimited life with a continuation vote in
2028.
Annual Redemption Facility
The Company has introduced an annual redemption facility that gives
Shareholders an opportunity to realise their holdings through a redemption of
all or any of their Ordinary Shares on the Redemption Point, provided that
they held the relevant Ordinary Shares on the date six months prior to the
relevant Redemption Point and continued to be beneficially interested in those
shares at all times since that date until the Redemption Point. The first
Redemption Point was on 30 September 2024 and every year thereafter. The
redemption facility has no impact on the going concern of the Company. Refer
to further details in the Directors 'Report on pages 41 to 42 and in the Notes
to the financial statements on pages 55 to 56.
Investment Objective
The Company's investment objective is to achieve long-term capital
appreciation by investing in a diversified portfolio of companies that have
high growth potential at an attractive valuation.
Investment Policy
The Company aims to achieve its investment objective by investing in the
securities of publicly traded companies in Vietnam, as well as in the
securities of foreign companies if a majority of their assets and/or
operations are based in Vietnam. The Company may invest in equity securities
or securities that have equity features, such as bonds that are convertible
into equity.
The Company may invest in listed or unlisted securities, either on the
Vietnamese stock exchanges or through purchases on the Over the Counter
("OTC") Market, or through privately negotiated deals.
The Company may invest its available cash in the Vietnamese domestic bond
market, as well as in international bonds issued by Vietnamese entities.
The Company may utilise derivatives contracts for hedging purposes and for
efficient portfolio management but will not utilise derivatives for investment
purposes.
The Company does not intend to take control of any company or entity in which
it has directly or indirectly invested (the "Investee Company") or to take an
active management role in any such company. However, Dynam Capital, Ltd.
("Dynam Capital"), (the "Investment Manager") may appoint one of its
directors, employees or other appointees to join the board of an Investee
Company and/or may provide certain forms of assistance to such company,
subject to prior approval by the Company's Board.
The Company integrates environmental, social and corporate governance ("ESG")
factors into its investment analysis and decision-making process. Through its
Investment Manager, the Company actively incorporates ESG considerations into
its ownership policies and practices and engages investee companies in pursuit
of appropriate disclosure and the improvement of material issues.
The Company may invest:
● up to 25% of its NAV (at the time of investment) in companies with
shares traded outside of Vietnam if a majority of their assets and/or
operations are based in Vietnam;
● up to 20% of its NAV (at the time of investment) in direct private
equity investments; and
● up to 20% of its NAV (at the time of investment) in other listed
investment funds and holding companies which have the majority of their assets
in Vietnam.
Borrowing Policy
The Company is permitted to borrow money and to grant security over its
assets, provided that such borrowings do not exceed 25% of the latest
available NAV of the Company at the time of the borrowing unless the
Shareholders in general meeting are otherwise determined by ordinary
resolution.
Investment Restrictions and Diversification
The Company will adhere to the general principle of risk diversification in
respect of its investments and will observe the following investment
restrictions:
● the Company will not invest more than 20% of its NAV (at the time of
investment) in the shares of a single Investee Company;
● the Company will not invest more than 40% of its NAV (at the time
of investment) in any one sector;
● the Company will not invest directly in real estate or real estate
development projects, but may invest in companies which have a large real
estate component, if their shares are listed or are traded on the OTC Market;
and
● the Company will not invest in any closed-ended investment fund
unless the price of such investment fund is at a discount of at least 10% to
such investment fund's NAV (at the time of investment).
Furthermore, based on the guidelines established by the United Nations
Principles for Responsible Investment, of which the Company is a signatory:
● the Company will not invest in companies known to be significantly
involved in the manufacturing or trading of distilled alcoholic beverages,
tobacco, armaments or in casino operations or other gambling businesses;
● the Company will not invest in companies known to be subject to
material violations of Vietnamese laws on labour and employment, including
child labour regulations or racial or gender discriminations; and
● the Company will not invest in companies that do not commit to
reducing in a measurable way pollution and environmental problems caused by
their business activities.
Any material change to the investment policy will only be made with the
approval of Shareholders by ordinary resolution.
Shareholder Information
Apex Fund and Corporate Services (Guernsey) Limited (the "Administrator") is
responsible for calculating the NAV per share and delegates this function
under a legal contractual arrangement to Standard Chartered Bank (Singapore)
Limited (the "Sub-Administrator"), previously Standard Chartered Bank,
Singapore Branch until its transference under the Banking Act on 13 May 2019.
The estimated NAV per ordinary share is calculated as at the close of business
each business day by the Investment Manager and published at close of business
in Vietnam the same day.
The monthly NAV is calculated by the Sub-Administrator on the last business
day of every month and announced by a Regulatory News Service within 10
business days.
Chairman's Statement
Dear Shareholder,
I am pleased to present this annual report for the financial year ended 30
June 2025 - a period marked by global challenges, regional resilience, and
significant progress for Vietnam.
This year has been particularly turbulent for global investors, with US
President Donald Trump's April trade tariffs adding to uncertainty and causing
a sharp retreat from risk assets. Markets have since recovered a substantial
amount of April's losses, and investors are again looking at emerging markets
as they reassess portfolio construction and consider a potentially weaker US
dollar along with lower US interest rates.
In the Interim Report, issued in March 2025, I said that "it is too early to
say what the new US administration (Trump 2.0) will mean for Vietnam". But now
we have a much greater sense of what this means - higher trade tariffs.
Increased tariffs on its key exports to the US will inevitably affect the
country's economy.
While Trump's 'Liberation Day' reciprocal tariffs of 47% were unexpectedly
high, a series of proactive negotiations by the Vietnamese authorities since
April appear to have successfully tempered them down to 20% on most items and
40% on transhipped goods. Although the specifics about these terms are not
totally clear, Vietnam's equity market has responded positively.
In addition, beneath the trade war waves, there has been a strong undercurrent
of reform and development in Vietnam's economy that the Investment Manager
believes will present considerable benefits in the mid- and long term. I
encourage you to read the Investment Manager's Report, where the economic
drivers and impact on the stock market and the Company are explored in greater
detail.
During the first half of the year under review, a favourable reception for the
annual redemption feature helped to significantly reduce the Company's
discount to NAV and the Company traded at a premium for the first time since
IPO, with the share price and NAV hitting historic highs during the first half
of the financial year. Also, in November, the Board visited Vietnam and
attended an investor conference organised by the Investment Manager, where we
met several shareholders and prospective shareholders from the UK, the US,
Singapore, and Australia. We saw how interest in the Company comes from a
broad and diverse group of investors, and on the back of this demand, the
Company was able to issue more shares - another first. Although the volume of
shares issued was modest, it paved a positive start to the second half of the
reporting year.
Nonetheless, in April particularly, the mood shifted as Trump's tariff
announcements hit many investment companies' share prices hard and we saw
discounts widen again. I am pleased to say with a combination of selective
buybacks and a continued programme of investor meetings and updates by the
Investment Manager, the discount remains the narrowest of the peers by a large
margin. The Fund is also among the top third of UK investment companies with
no or low single-digit discounts in the UK. [Source AIC].
Fund NAV and Shareholder Returns
The equity market in Vietnam is driven by a vast and growing domestic investor
base, one that has a different risk profile and investment horizon than
foreign investors. Over the past several months, although foreign investors
have continued to be net sellers of Vietnamese equities - including selling
some blue chip stocks the fund holds - the country's 10 million domestic
investors have been rallying around a few key index constituent companies that
are not held in the Company's portfolio. This bifurcation has impacted the
performance on a relative basis.
The Company's Net Asset Value ("NAV") per share fell by 2.5% in the year under
review. This compares to the Vietnam All Share Total Return Index ("VNASTR")
gain of 9.8%. The share price fell by 7% due to a combination of this decrease
in NAV and the widening of the discount to NAV.
The Investment Manager discusses the current level of relative
underperformance in the Investment Manager's Report. However, I must point out
that over the past five years, the Investment Manager has delivered an
impressive average of 17% compound annual growth in NAV after fees and
expenses, showing strong long-term outperformance against the market and its
peers. The Company has consistently over the course of the year, had the
narrowest discount of the three London-listed funds focused on Vietnam,
reflecting the robust performance over five years with a total shareholder
return of 117% compared to 68% for VEIL and 64% for VOF - and, indeed, 48% in
dollar terms for the broader VN Index.
First Annual Redemption and Positive Impacts
September 2024 saw the successful implementation of the Company's first annual
redemption feature, which allowed qualifying shareholders to redeem their
shares for cash at NAV. About 12% of the Company's shares were redeemed. The
positive results of this process demonstrated both investor confidence and our
proactive approach to providing liquidity to shareholders. The orderly nature
of the redemption also highlighted the stability of our underlying portfolio
and its appeal among long-term investors.
Elimination of Discount to NAV
With investors turning their attention back to emerging markets and therefore
interest in the Company growing, the Board's aim is to continue to keep the
discount under close control - ideally, to eliminate it, and be able to issue
more shares subject to demand. The Investment Manager's strategy can
accommodate fresh capital, and the Investment Manager is well-positioned to
seize emerging opportunities in Vietnam's vibrant market, particularly in
sectors poised to benefit from structural growth drivers such as urbanisation,
industrialisation, and the burgeoning middle class.
Award-Winning Performance
At the end of 2024 we were honoured to receive multiple awards recognising our
dedication to delivering consistent returns, adhering to our Environmental,
Social, and Governance ("ESG") commitments, and continuing to fulfil our
purpose for investment excellence. We were awarded Citywire's "Investment Fund
of the Year" in single-country emerging market category. We also won
Investment Week's "Investment Trust of the Year" and the UK Investor
Magazine's "Country Fund of the Year".
In 2009, the Company became the first Vietnam-focused fund to become a
signatory of the United Nations Principles for Responsible Investing ("PRI").
In the latest PRI Transparency Report, the Company scored three 5 stars, which
is far above the median in all reported categories, with scores of 92% for
Policy Governance and Strategy, 93% under the listed equity (active) category,
and 100% for confidence-building measures.
These accolades are a testament to the quality of our team, our disciplined
approach to value investing, and the long-term relationships we have built
within Vietnam's dynamic economy. We are proud of these accomplishments, and
they further motivate us to continue seeking out the best opportunities for
our shareholders.
Outlook
The Vietnamese government is dedicated to further developing the country's
financial markets and has announced plans to create two International
Financial Centres in Ho Chi Minh City and Danang. In May, the stock market's
infrastructure underwent a significant upgrade with the official launch of the
new KRX trading system. As the Investment Manager highlights, the launch is a
catalyst for FTSE Russell to elevate Vietnam's stock market from Frontier to
Secondary Emerging Market status as early as October 2025. This would coincide
with investors' return to emerging markets, and could bode well for fresh
interest in the Fund. Notwithstanding the second redemption window that closed
on 31 August, where 17.9% of the Company's shares were redeemed, we are keen
to see the size of the Fund grow.
Economic growth in Vietnam has averaged 6.5% per annum over the past 30 years,
and the government is seeking to accelerate this rate further. At 30 June, the
Year-on-Year (YoY) GDP growth hit a 15-year high of 7.52%. The government has
recently raised its target from 8 to 8.5% growth for 2025 and is going for
double-digit expansion thereafter. To meet this ambitious level of growth, it
has been ramping up meaningful reforms and regulatory efforts. As part of a
broader drive to enhance government efficiency and improve policy
responsiveness it recently reduced the number of provinces from 63 to 34 and
announced major reforms to streamline the civil service and position the
private sector more centrally in its economic development plans. The
government is also focused on enhancing public infrastructure, and this will
have long-term benefits on the economy.
Vietnam is still one of the world's most exciting growth markets, and as
always, we stay focused on building a resilient portfolio capable of
navigating both opportunities and challenges.
We are now entering the 20th year of the Company, and look forward to
celebrating this in 2026 with investors.
I would like to extend my sincere gratitude to all our shareholders for their
continued support and confidence.
Yours sincerely,
Hiroshi Funaki
Chairman
VietNam Holding Limited
30 September 2025
Investment Manager's Report
Despite US President Donald Trump's tariff turmoil, the economic backdrop in
Vietnam during the reporting period has been one of resilience and
adaptability. As the Chairman notes, the government has ambitious plans to
accelerate growth and has put in place deep structural reforms to help set the
stage. Plans have been outlined to reduce the size of the civil service, and
from 1 July 2025 the number of provinces in the country has been reduced from
63 to 34. The expanded metropolis of Ho Chi Minh City now accounts for 25% of
Vietnam's GDP.
These deep shifts are part of a major reform plan, dubbed Doi Moi 2.0. The
first Doi Moi in the late 1980s opened Vietnam up to international trade and
attracted significant levels of foreign direct investment to support
manufacturing for export. This eventually led Vietnam to become the
China-plus-one manufacturing location of choice, propelling exports to the USA
beyond USD 100 billion, and positioning the country - negatively in President
Trump's view - as one of the top three contributors to the burgeoning US trade
deficit. Doi Moi 2.0 or 'rising' is about growing the domestic economy, using
public investment in infrastructure to leverage the growth and achieve a
velocity to escape the middle-income trap.
Despite the recent volatility, the longer-term objectives of the government
could support Vietnam's position as the highest growth economy in the world.
The structural reforms will unlock new opportunities in the country and are
expected to have a longer-term beneficial growth on capital markets. Economic
growth does not automatically translate to uniform stock market returns, and
it is increasingly important to have deeper research on the ground, and a
nimble approach to stock selection and portfolio construction.
Macro Overview and Key Economic Drivers
As mentioned earlier, Vietnam's GDP growth reached 7.52% in the six months to
30 June 2025, a fifteen-year high and the government has raised its own target
to 8% and renewed its focus on expediting infrastructure projects-particularly
in transportation, energy, and logistics. The level of public investment
disbursement in the six months to June is estimated at USD 10.5 billion,
around one-third of the full year target of USD 36 billion. Prior to 2020, the
average annual expenditure was around USD 13.4 billion.
Despite the chaos and uncertainty about tariff levels, Foreign Direct
Investment ("FDI") in Vietnam remains robust. Registered FDI reached USD 38
billion in December 2024, and the registered level of FDI in the first six
months of 2025 was USD 21.5 billion. Disbursed FDI from January to June
reached USD 11.7 billion, an 8.1% increase on the same period in the previous
year.
Clearly uncertainty on relative trade tariffs delayed some decisions on
expanding foreign manufacturing capacity, and we saw Vietnam's PMI
manufacturing index reach 48.9 at the end of June, compared to a level of 53 a
year ago (above 50 indicates expansion). But once the uncertainty is resolved,
even higher levels of FDI are expected to flow in.
Sectoral Performance
As the Chairman mentioned in his statement, there has been a bifurcation in
the performance of some parts of Vietnam's equity market, and this has been
driven by capital flows rather than by underlying fundamental earnings'
quality. For the past twelve months or so, more than USD 2 billion of foreign
capital has left the domestic equity market, and in the first few months of
this year, much of this outflow was concentrated in more liquid blue chips,
including several in our portfolio. The price-earnings ratio of some of these
stocks came to recent historic lows. On the other hand, the active domestic
investor base - comprising well over 10 million retail investors - has looked
for nearer-term opportunities in a few large index stocks, many of which are
not in our portfolio. As a result, the Vietnam All Share Index has rallied in
spite of the share sell-off in April.
April's 'Liberation Day' tariffs affected sentiment in the market, even though
much of the market and much of the Fund's portfolio is tilted towards the
domestic economy. The market experienced a 20% decline in value over the
course of three trading days. Since April, the market has recovered much of
its losses.
During the year we took some profit in our top-position, FPT Corporation,
which is a leading IT and telecommunications provider. Its share price
declined by 10% this fiscal year. Some of the decline is in anticipation of
lower visibility on the pipeline of large projects - as multinationals delayed
Capex plans amidst trade uncertainties. The decline is partly due to
uncertainties about the change in controlling shareholders in one of its
telecommunication divisions, with others concerned over the impact of advances
in AI on demand for outsourced software, and how quickly its own AI ambitions
can lead to more bottom-line gains. The trimmed-down position in the portfolio
has given room for other stocks to lead our top holdings.
We believe the consumer retail sector will benefit from renewed consumer
confidence and a growing middle class looking for higher-quality goods and
services. We have been increasing our portfolio weights in the retail sector,
particularly in Mobile World Group ("MWG"), a leading omnichannel retailer,
and FRT, which owns Long Chau, the country's leading pharmacy chain. Despite
an increasingly positive outlook for several retailers, the sector
underperformed, and we remain overweight on it.
Although we have 35% allocated to banks, our position is underweight in
comparison to the index. Our banking picks have outperformed the banking
sector: Techcombank ("TCB") rose 42.8%, Sacombank ("STB") by 58%, MB Bank
("MBB") by 30% and VietinBank ("CTG") by 31.8%. TCB is now our largest
portfolio holding and its share price has rallied on expectations of an IPO of
its stock-broking subsidiary. Banks continue to trade on undemanding
valuations and are expected to see higher credit growth in 2025. By
maintaining Net Interest Margins ("NIM"), some will see earnings-per-share
growth in excess of 20%.
Domestic investors showed strong interest in the conglomerate Vingroup
("VIC"), a stock we do not hold, which saw its shares soar 126%. Vinhomes
("VHM"), its related party real estate company, rose by 98.7% percent. VIC's
founder also owns the electric vehicle ("EV") manufacturer VinFast (NASDQ:
VFS). Losses in the EV business have weighed heavily on the group in recent
times, as there are several billion dollars of loans issued and guaranteed by
group companies, and VIC's market capitalisation fell to about USD 6 billion
in January 2025. It has since risen to close to USD 17 billion. Aside from a
position in VHM, the Fund has little exposure to VIC.
Interestingly, as part of its strategy to support national infrastructure
development plans, Vingroup has created a new subsidiary, VinSpeed, to develop
high-speed rail solutions for segments of the domestic railway network. This
is consistent with the government's goal of having private capital play a role
in infrastructure development. A recent resolution of the National Assembly
has further affirmed this objective, and we believe the private sector will be
given even more prominence in the country's development. While this is
encouraging for the momentum of 'chaebols' like Vingroup, assessing the
fundamental risk-reward proposition of conglomerates can be challenging. If
Vingroup can successfully position its EV company in regional automobile
markets while also commercialising the high-speed rail opportunities, then it
could emerge as one of the largest non-bank conglomerates in the ASEAN region.
Portfolio Adjustments and Investment Strategy
At the AGM in November 2024, shareholders approved a slight adjustment to the
investment restrictions in the Company's investment policy. These changes were
designed to give greater flexibility in portfolio construction, taking
advantage of the nimble, on-the-ground investment research. The investment
restrictions on a single sector were raised from 30% to 40% and the
restriction on a single stock was raised to 20%. We took advantage of the
former, lifting the allocation to the banking sector to 35% (still below the
index weight of 40%) but our largest single stock exposure is a little over
11%.
Performance Highlights
Despite a five-year annualised outperformance of more than 5% against the
index, this year we underperformed for reasons outlined above. The Company's
full year NAV per share return during the reporting period declined by 2.5%
versus an index gain of 9.8%. The elimination of the discount to NAV gave way
to the return of a small discount to NAV (5%). As a combined effect of these
factors, the share price decreased by 13.8%. Post-year end the share price has
increased by 16.9% (26 September 2025).
ESG Is Not Dead
Our approach to ESG integration has continued to deliver tangible results,
with our focus on sustainability contributing to both the resilience and
attractiveness of our portfolio. We have seen increased recognition of our ESG
efforts, as shown by the awards received during the period. These accolades
are an endorsement of our commitment to responsible investing, and we are
still dedicated to embedding ESG principles across all aspects of our
investment process. To support this, we have also completed a study with MSCI
into the carbon footprint and transition readiness of our portfolio companies.
In May we sponsored the third Vietnam ESG investor conference in Ho Chi Minh
City. The conference showed that investors still believe in the relevance of
ESG to Vietnam. Climate change is a visible risk in Vietnam, with several
uncharacteristically severe storms hitting the north of the country this year.
The Mekong river, which pumps and feeds the rice growing area in the Mekong
Delta, also faces several longer-term ecological challenges. The conference
also highlighted opportunities to be climate-transition ready; how meeting the
EU's requirements for exports raises the quality of operations for some
manufacturers, and how attention to governance and responsible investing can
set the 'great' apart from the 'good'. One of VNH's board members, Ms Vu, is
an acknowledged expert on the ESG issues in Vietnam, and she has also
contributed a thought leadership piece on the issue of modern slavery, which
is included as part of the Market Reports.
Planes, Trains, and Automobiles - Urbanisation and the Modernisation of
Infrastructure
In the Interim Report, we mentioned that the Ho Chi Minh City Metro system
finally opened in December 2024, connecting several parts of the city with a
fast, affordable, and clean transport alternative to cars and motorbikes.
Ridership levels on the metro have exceeded expectations, and it has gone from
a novelty to a daily part of people's lives. The government also announced
plans in December for a new high-speed train to connect Hanoi and Ho Chi Minh
City, with the prospect of reducing the travel time along the 1726 km train
route from 36 hours to 5 hours when this multi-year and USD 60 billion project
is completed. In China, high-speed trains routinely traverse the various
cities at top speeds of 250 kmh, boosting local economies. Vietnam is a long,
narrow country, and is only connected by rail to China in the north by a 120
kmh service (a route which reopened for tourists in May, after being closed
since the pandemic). The Vietnamese government has encouraged local
conglomerates to participate in rail projects in various parts of the country.
These projects will invigorate the communities they connect and also boost
demand for domestic steel and other construction materials. One way to take
part in this growth trend is through portfolio companies such as, Hoa Phat
Group ("HPG"), a domestic steel champion, and the largest steel manufacturer
in Southeast Asia.
Given the country's geography and the slow road and rail connection between
the North and the South, the domestic aviation route connecting Hanoi and Ho
Chi Minh City is the second busiest in the world. Domestic tourism and an
influx of foreign tourists - growing by 20% during the year to an historic
high - has put pressure on some of the airports. Travelling through Ho Chi
Minh City's international arrival and departure terminal can be painfully
slow. Thankfully, the new international terminal in Long Thanh - about 40 km
east of downtown Ho Chi Minh City - is taking shape and should be open for
business in early 2027. There are a couple of ways to invest in the growth of
the aviation sector in Vietnam. One is through services - such as ACV, an
airport concession operator, or Saigon Cargo Services, a cargo handler. The
other way is to buy into the listed airlines - VietJet and Vietnam Airlines.
All of these have been portfolio companies at various stages over the past
five years.
As people become wealthier, consumption of automobiles has increased
historically. In China, as an example, total vehicle ownership is
approximately 322 per thousand people - half the level of Europe. In Vietnam,
the level is much lower, at 63 cars per 1000, and the streets are more
populated by motorbikes (over 90% of households own a motorbike). One of the
changing dynamics in Vietnam (as with China) is the emergence of electric
vehicles. For example, the city of Hanoi has recently planned to ban all
fossil-fuel motorcycles and mopeds from the central part of the capital by 1
July 2026, and from the entire city by 2030. There are a few ways to invest in
the automobile sector in Vietnam, one EV manufacturer is listed in NASDAQ
(Vinfast: VFS), and a few car distribution companies are listed in Vietnam.
There are also rumours of one of the country's largest auto manufacturers
planning a future IPO. Given the furious global competition in EVs, this is a
sector we are not directly exposed to currently.
Outlook
Looking forward, when the dust settles on the trade tariff negotiations, we
are optimistic that Vietnam will keep its position as a key China-plus-one
manufacturing centre. Vietnam is already looking to broaden and deepen its
trade with other countries to mitigate risks from trade flows. Vietnam will
look to support strong commercial ties with China and the US, as both are
important trading partners. The outcome will be a delicate balance, as
transshipment of goods from China to the US via Vietnam appears to be firmly
in the targets of the US administration, and Vietnam is keenly aware of this.
Vietnam will still be one of the world's fastest-growing markets, even if it
doesn't meet its government's growth targets. As it looks to modernise its
economy further, to develop more efficient physical infrastructure, and to
undertake long-lasting structural reforms, a 'same-same but different' country
may appear.
As the Chairman notes, next year marks the 20th anniversary of the Company.
Over the past twenty years, the country's capital markets have grown
exponentially - the equity market capitalisation has gone from USD 300m to USD
300 billion, and average daily trade levels have gone from USD 1 million to
USD 1 billion a day. There are now twelve companies with market
capitalisations higher than USD 5 billion (six are in our portfolio). There
have been genuine improvements in the stock market operations, and the latest
upgrade to the infrastructure was made in early May with the installation of
the KRX stock exchange platform. The installation went smoothly and addresses
some of the concerns raised by agencies such as FTSE Russell and MSCI. This
may be the catalyst that helps secure an upgrade by FTSE Russell to Secondary
Emerging status which would see the capital markets grow even more rapidly.
The government has ambitious plans to develop two International Financial
Centres in Vietnam (in Danang and HCMC), so the next twenty years promise to
be even more interesting.
The Company is well positioned for growth. We continue to be nimble in stock
selection and portfolio construction and have doubled down on the domestic
champions we believe will most benefit from the long-term economic success
story of Vietnam. Our strategy is a simple one: find high-quality companies
that show strong governance, solid fundamentals, and significant growth
potential.
We believe that our active management approach, combined with our deep
understanding of the Vietnamese market, positions us well to navigate both
opportunities and challenges as they arise.
Despite heightened volatility, both external and internal dynamics of the
economy are presenting opportunities and challenges for the Fund. To achieve
the ambitious target of 10% GDP growth from 2026 onward, Vietnam will need
reforms and stronger growth drivers. We believe the key growth engines remain
intact, with the private sector poised to benefit. The Fund's core investment
themes-industrialisation, domestic consumption, and urbanisation-are further
reinforced.
In conclusion, we are still committed to delivering long-term value to the
Company through a balanced and diversified approach to investing in Vietnam's
most promising sectors. We appreciate your continued trust and look forward to
navigating the opportunities that lie ahead.
Thank you for your continued trust and support.
Dynam Capital, Ltd
Top Five Portfolio Companies
Mobile World Group ("MWG")
As at 30 June 2025
VietNam Holding's investment
Date of first investment 11 Sept 2017
Ownership 0.3%
Percentage of NAV 8.9%
Internal rate of return (annualised) 7%
Share information
Stock Exchange HOSE
Date of listing 14 Jul 2014
Market capitalisation (USD million) 3,712.68
Free float 82.7%
Foreign ownership 48.11%
Financial indicators (as at 31 December) 2024 2023
Equity (USD million) 1,076.6 917.7
Revenue (USD million) 5,143.1 4,646.6
EBIT (USD million) 156.3 17.1
NPAT (USD million) 142.9 6.6
Diluted EPS (VND) 2,546 115
Revenue growth 10.7% -17.9%
NPAT growth 2067.7% -96.2%
Gross margin 20.5% 19.0%
EBIT margin 3.0% 0.4%
ROE 14.5% 0.7%
D/E 0.97 1.08
About the Company
Founded in 2004 as a single mobile phone store, MWG has grown into Vietnam's
most prominent modern retailer, leading both in revenue and number of physical
outlets (over 5,300 by mid-2025). Operating under core brands such as
Thegioididong, Dien May Xanh, Bach Hoa Xanh, TopZone, and AVAKids, MWG today
offers a comprehensive assortment of products ranging from consumer
electronics and groceries to personal care, pharmaceuticals, and baby goods.
MWG's workforce has surpassed 70,000 employees, reflecting its continued
expansion nationwide.
As a market-making force in Vietnam's modern trade sector, MWG redefined the
retail experience by testing new formats, leveraging data analytics for
product curation, and expanding its omni-channel infrastructure. MWG now holds
a dominant share exceeding 50% in mobile phone and consumer electronics
retailing. Meanwhile, its grocery chain Bach Hoa Xanh ("BHX") has reached
profitability in 2024 after years of restructuring, and is now a key revenue
and margin contributor, especially in Vietnam's Tier 2 and Tier 3 cities.
Recognising the accelerated shift toward online retail, MWG has made
significant investments in its e-commerce ecosystem, combining last-mile
logistics, warehouse automation, and customer-centric digital platforms. By
2024, online sales accounted for nearly 10% of MWG's total revenue. The
company's omni-channel retail strategy, integrating physical retail with
digital convenience, remains a key competitive advantage.
Recent Developments
After a turbulent 2023 marked by an 18% revenue decline and a steep drop in
profits, MWG staged a strong comeback in 2024. Total revenue recovered to USD
5.1 billion, up 9% year-on-year, while after-tax profit rebounded more than 20
times to reach USD 143 million, in line with management's guidance. The
turnaround was driven by a strategic refocus on core business units,
operational streamlining, and improved consumer sentiment as Vietnam's economy
stabilised.
The ICT segment (phones, laptops, accessories) saw a rebound in both volume
and margin, aided by easing price wars and increasing demand for mid- to
high-end devices. Notably, MWG deepened partnerships with leading OEMs and
launched exclusive SKUs, enhancing profitability.
On the grocery front, BHX achieved its first full-year profitability in 2024
after restructuring its store network, improving SKU efficiency, and exiting
underperforming locations. With a new focus on neighbourhood-centric stores
and private label products, BHX has become a vital engine for MWG's long-term
growth, particularly as Vietnam's urbanisation and income levels continue to
rise.
Looking ahead to 2025, MWG aims to cross the USD 5.6 billion revenue mark and
deliver over USD 184 million in net profit, supported by digital
transformation, AI-driven customer insights, and expansion into higher
purchase-frequency 'essential' retail. The company also eyes potential
regional expansion via the export of retail know-how and cross-border
e-commerce platforms.
Sustainability Strategy
MWG has implemented several key sustainability strategies to enhance its
long-term growth and operational efficiency, including community engagement
(e.g. promoting eco-friendly products and practices) and Circular Economy
Initiatives - MWG's various brands have undertaken projects to reduce plastic
waste and promote recycling (e.g. collecting used batteries and recycling
advertising materials into organic fertilisers). The company prioritises its
employees, followed by customers and then shareholders. The performance-linked
ESOP programs of MWG have helped retain talented people in the company for
several years and have motivated some of the company's ambitious top managers
to seek penetration into new market segments.
ESG Achievements
In 2024, MWG significantly advanced its environmental initiatives by
installing solar panels at over 600 stores and deploying Internet-of-Things
("IoT") systems in more than 1,700 locations to optimise energy consumption,
underscoring its commitment to renewable energy and operational efficiency.
The company also embraced circular-economy principles through waste-reduction
programs and responsible sourcing policies, coupled with transparent
governance, including the establishment of a dedicated ESG committee and the
hiring of a full-time ESG officer. MWG's efforts earned it recognition among
the Top 20 Companies with the Best Sustainability Index in Vietnam and a place
among the Top 50 in the Corporate Sustainability Awards. On the social front,
the corporation supported communities impacted by Typhoon Yagi, donating 2,000
tons of rice and VND 5 billion in aid, demonstrating meaningful community
engagement and disaster relief responsiveness.
ESG Challenges
Despite these successes, MWG faces ongoing environmental and operational
challenges. With a network spanning thousands of stores nationwide, the
company remains exposed to physical risks from climate change, including
extreme weather events, which strain logistics and supply chain resilience.
While energy-saving installations are in place, achieving consistent energy
efficiency and scaling renewable strategies across all outlets will require
significant investment and coordination. Sustainalytics notes that MWG carries
a medium-level ESG risk score (~21.6), citing weaker management practices in
addressing these vulnerabilities relative to peers. Additionally, ensuring
continued progress in governance-such as maintaining board-level ESG
oversight, improving supply chain traceability, and formalising carbon
reduction targets-remains a critical area for development before performance
aligns more fully with best-in-class global standards.
HPG Group ("HPG")
As at 30 June 2025
VietNam Holding's investment
Date of first investment 20 Jun 2013
Ownership 0.1%
Percentage of NAV 7.1%
Internal rate of return (annualised) 37.9%
Share information
Stock Exchange HOSE
Date of listing 15 Nov 2007
Market capitalisation (USD million) 6,679.21
Free float 59%
Foreign ownership 18.68%
Financial indicators (as at 31 December) 2024 2023
Equity (USD million) 4,389.2 4,039.9
Revenue (USD million) 5,315.9 4,673.1
EBIT (USD million) 559.5 379.9
NPAT (USD million) 460.2 267.1
Diluted EPS (VND) 1,751 1,005
Revenue growth 13.8% -22.1%
NPAT growth 72.3% -25.4%
Gross margin 13.3% 10.9%
EBIT margin 10.5% 8.1%
ROE 11.1% 6.8%
D/E 0.72 0.64
About the Company
Established in 1992 as a construction machinery and equipment trading firm,
Hoa Phat Group Joint Stock Company ('HPG') has evolved into Vietnam's leading
industrial manufacturing conglomerate, with its core operations centered in
the steel industry.
As of year-end 2024, HPG held the leading market positions in Vietnam's
construction steel and steel pipe segments, with respective market shares of
38% and 28%. The steel segment remains the Group's principal revenue and
profit driver, accounting for 93% of total revenue and 86% of net profit. The
agriculture segment follows, contributing 5% of revenue and 8% of net
profit.
As of 31 December 2024, HPG has 74 subsidiaries with a workforce of 32,780
employees.
Recent Developments
In 2024, HPG reported revenue of approximately USD 5.3 billion and net profit
of USD 460 million, representing 13.8% growth in revenue and a 72.3% increase
in net profit compared to the previous year.
HPG made notable progress on its key expansion project, the Hoa Phat Dung Quat
2 Steel Integrated Complex, which covers an area of 280 hectares. Phase 1
commenced operations in Q1 2025, with full completion targeted by year-end
2025. With a designed annual capacity of 5.6 million tons of hot-rolled coil
("HRC") and a total investment of VND 85,000 billion (approximately USD 3.25
billion), the project will increase HPG's total crude steel capacity to 15
million tons per year. This capacity milestone will position Hoa Phat among
the Top 30 global steel producers.
In 2025, HPG has set ambitious business targets that reflect its confidence in
continued growth and operational expansion. The Group aims to achieve revenue
of VND 170 trillion, representing a 21% increase compared to 2024 and net
profit after tax of VND 15 trillion, marking a 25% increase from the previous
year. This growth will be driven primarily by the ramp-up of its new capacity
from the Hoa Phat Dung Quat 2 Steel Integrated Complex.
Sustainability Strategy
As the largest steel producer in Southeast Asia, HPG is actively advancing its
sustainability agenda. The Company is investing significantly in
deep-processing technologies and R&D to produce hundreds of thousands of
tons of high-tech, specialised steel, including railway steel, train axle
steel, and other premium-grade products to support national infrastructure
projects and expand global exports.
HPG has adopted modern production technologies from G7 nations to enhance
efficiency, reduce energy consumption, and minimise greenhouse gas emissions.
In alignment with international trade and environmental standards,
particularly those of the EU, HPG has completed a comprehensive greenhouse gas
emissions inventory, marking a key milestone in the Group's long-term
sustainable development roadmap.
ESG Achievements
Steel production is categorised as a carbon-intensive industry due to its
reliance on carbon-based fuels and reductants. HPG has invested hundreds of
millions of US dollars in equipment and technology for environmental
monitoring to keep pollutants under control and within national standards. Hoa
Phat has implemented modern closed-loop production technology across all
integrated iron and steel complexes. This technology helps protect the
environment, reduce CO2 emissions, and ensures up to 90% energy
self-sufficiency for production.
ESG Challenges
Despite this progress, HPG faces material ESG challenges, particularly in
emissions and climate risk governance. According to Sustainalytics, the
company is rated as "Severe Risk" (score: 50.5), placing it near the bottom of
its global steel peer group, largely due to limited disclosure and weak
management of material risks such as greenhouse gas emissions and occupational
safety. HPG remains heavily reliant on blast furnace-basic oxygen furnace
("BF-BOF") technology, which is carbon-intensive compared to electric arc
furnaces ("EAFs") or DRI-based steelmaking. While the company outlines
long-term ambitions toward low-carbon steel, it has not yet committed to
science-based targets or joined voluntary climate initiatives like the Science
Based Targets initiative ("SBTi") or Responsible Steel. Moreover, Scope 3
emissions across upstream iron ore logistics and downstream construction
supply chains remain largely unaccounted for. Governance-wise, while ESG
oversight has been introduced, independent board representation and gender
diversity remain limited, which may constrain broader ESG integration.
Maintaining competitiveness in a volatile steel market while transitioning
toward green production poses both financial and strategic headwinds.
Addressing these issues will be critical if Hoa Phat is to move from a
domestic ESG leader to a globally recognised sustainable industrial player.
Techcombank ("TCB")
As at 30 June 2025
VietNam Holding's investment
Date of first investment 26 Mar 2024
Ownership 0.1%
Percentage of NAV 10.7%
Internal rate of return (annualised) 10.3%
Share information
Stock Exchange HOSE
Date of listing 4 Jun 2018
Market capitalisation (USD million) 9,262.36
Free float 77.3%
Foreign ownership 22.51%
Financial indicators (as at 31 December) 2024 2023
Equity (USD million) 5,663.7 5,170.5
TOI (USD million) 1,799.0 1,573.8
NPAT (USD million) 824.0 707.3
EPS (VND) 3,049 2,549
TOI growth 14.3% -8.4%
NPAT growth 16.5% -17.2%
ROA 2.4% 2.4%
ROE 15.5% 14.8%
CAR 15.3% 14.3%
NPL 1.2% 1.2%
Equity multiplier 6.6 6.5
About the Company
Founded in 1993, TCB is the sixth-largest bank in Vietnam by total assets. It
launched its IPO and was listed on the Ho Chi Minh City Stock Exchange in
2018. As of 2024, TCB operated a network of 302 branches and transaction
offices, with 11,848 employees, holding loan and deposit market shares of 4.0%
and 3.6%, respectively.
TCB has focused on investing in data and technology, which has made it an
industrial leader in terms of digital transformation. In 2016, it was the
first bank in the industry to launch the "E-banking zero fee" program, which
resulted in accelerating new customer acquisition, significant operating cost
reduction and high CASA. TCB applied Basel II in 2019 and implemented Basel
III in 2023.
In 2024, TCB accelerated the release of its first-in-market product
innovations - notably 'Techcombank Auto-earning' and 'Techcombank Auto-earning
2.0' - thereby enhancing its unique offerings and creating more data and
AI-powered hyper-personalised experiences to deepen retail and business
customers' engagements.
TCB's credit rating was upgraded by FiinRatings to 'AA-', from 'A+' with
'Stable' outlook. It was awarded the first and only bank in Vietnam to win
"Best Bank in Vietnam" by Global Finance, Finance Asia and Euromoney, all in a
year. Other ratings were Ba3 by Moody's, and BB- by S&P Global Ratings,
both with stable outlooks, positioning it as a top performer among Vietnam's
joint stock commercial banks.
Recent Developments
In 2024, net profit after tax ("NPAT") increased 16.5% YoY to USD 824.0
million, driven by strong credit growth.
Total credit surged 20.8% YoY, outpacing the industry. The bank has
strategically diversified lending beyond real estate and into sectors like
fast-moving consumer goods ("FMCG"), travel and leisure and utilities. TCB
continued to diversify its credit towards retail and small and medium-sized
enterprises ("SMEs").
The non-performing loan ("NPL") ratio was maintained at 1.17%, ranking among
the lowest in the industry. CASA ratio was 40.9%, the highest ratio in the
industry. Capital adequacy ratio ("CAR") was 15.3%, second highest in the
industry, and a healthy coverage ratio of 113.8%.
Sustainability Strategy
With the vision of "Change banking, change lives," TCB is dedicated to
empowering individuals to reach their full potential. The bank is committed to
delivering greater value to customers and shareholders by offering innovative,
customer-centric solutions. TCB's mission is to lead the digital
transformation of the financial industry, helping individuals, businesses, and
corporations grow and thrive sustainably.
ESG Achievements
TCB has deepened its ESG integration by embedding sustainability across
strategy, operations, and financial solutions. In 2024, the bank issued its
first Green Bond Framework-Vietnam's first from a private bank - backed by an
S&P "medium green" rating and targeting up to USD 5 billion in green
financing over time. On operations, TCB's LEED Gold-certified head offices
in Hanoi and HCMC cut energy use by ~26%, while digital transformation helped
reduce paper and transportation waste. Community engagement remained robust:
the "Run for a Greater Vietnam" initiative -supporting HCMC and Hanoi
marathons - attracted around 30,000 runners, while VND 205 billion was
donated to social causes. Staff-led campaigns such as winter tree planting
with Gaia Conservation further demonstrate the cultivation of an ESG culture.
ESG Challenges
Despite strong momentum, TCB must navigate key challenges to ensure ESG
leadership is sustained. While green lending and bond frameworks are robust,
measuring, reporting, and managing associated environmental impact -
especially upstream emissions from financed projects - remains complex,
requiring enhanced ESG risk assessment across credit portfolios. In
governance, although ESG responsibilities are assigned to board committees and
senior executives, transparency around performance KPIs, independent
oversight, and alignment with frameworks like TCFD or SBTi could be improved.
Asia Commercial Bank ("ACB")
As at 30 June 2025
VietNam Holding's investment
Date of first investment 9 Oct 2020
Ownership 0.2%
Percentage of NAV 7.1%
Internal rate of return (annualised) 20.8%
Share information
Stock Exchange HOSE
Date of listing 9 Dec 2020
Market capitalisation (USD million) 4,194.23
Free float 87.9%
Foreign ownership 29.77%
Financial indicators (as at 31 December) 2024 2023
Equity (USD million) 3,195.3 2,787.5
TOI (USD million) 1,283.1 1,286.4
NPAT (USD million) 642.8 630.3
EPS (VND) 3,669 3,559
TOI growth -0.3% 5.4%
NPAT growth 2.0% 8.6%
ROA 2.1% 2.4%
ROE 21.8% 24.8%
CAR 11.8% 12.5%
NPL 1.5% 1.2%
Equity multiplier 10.4 10.1
About the Company
Founded in 1993, ACB is currently the eight largest bank in Vietnam by total
assets. It was listed on the Hanoi Stock Exchange in 2006 and transitioned to
the Ho Chi Minh Stock Exchange in 2020. As of 2024, it had a network of 388
branches and sub-branches and 11,614 employees with loan and deposit market
shares of 3.7% and 3.6%, respectively.
ACB is known for its conservative and prudent approach, with a strong focus on
the retail and SME segments, which make up 66% of its loan portfolio. The bank
maintains limited exposure to the real estate sector, with loans to property
developers accounting for less than 5% of total lending.
ACB adopted Basel II standards in 2019 and began implementing Basel III in
2023. It has also been a pioneer in sustainable development, demonstrating
strong environmental commitments. Notably, ACB was the first bank to publish a
standalone ESG report, underscoring its leadership in responsible banking.
Fiinratings ranked ACB with a Long-term issuer credit rating of "AA+" and a
"Stable" outlook. In 2024, Moody's assigned ACB a long-term issuer default
rating of Ba3 with a stable outlook. Fitch Ratings raised ACB's outlook on
long-term currency IDR from Stable to Positive. It was rewarded as Best Retail
Payment Initiative - Visa Card with Apple Pay by The Asian Banker, Best
Commercial Bank Vietnam 2024 by International Banker (UK), and Best Corporate
Bank Vietnam 2024 by Global Banking and Finance Review.
Recent Developments
In 2024, ACB's net profit after tax ("NPAT") rose modestly by 2.0% YoY,
reaching USD 642.8 million. Total credit and deposits saw strong growth,
increasing by 19.1% and 19.4% YoY, respectively.
The non-performing loan ("NPL") ratio was maintained at 1.5%, among the lowest
in the industry. Capital adequacy ratio ("CAR") was 11.8%, higher than the
minimum rate required by Basel II regulations.
Sustainability Strategy
ACB remains steadfast in its commitment to sustainable development strategy.
ACB sets pioneering goals by integrating and complying with sustainable
development orientations committed by the Government at COP26 as well as the
sustainable development guidelines by the State Bank of Vietnam's Green
Banking Project.
ESG Achievements
ACB has positioned itself as an ESG pioneer in Vietnam's banking sector, being
the first bank in the country to release a standalone ESG report-initially in
2023-demonstrating early and public commitment to sustainability. In 2024, ACB
introduced a dedicated Green/Social Credit product package, tying loan
policies to sustainability criteria and expanding financing options for
environmentally friendly and socially impactful projects. The bank has also
set public ambitions toward achieving net-zero emissions, aligning financial
practices with green values and stakeholder expectations. On social aspects,
ACB's community financing focuses on supporting SMEs, green energy solutions,
and inclusive economic development, backed by digital innovations which
improve access to financial utilities and efficiency for corporate customers.
Governance structures supporting these efforts include increased ESG
disclosure, although still evolving, reflecting a high level of transparency
and early integration of sustainability into core banking practices.
ESG Challenges
Despite early leadership, ACB still faces critical ESG challenges. The
transition to net-zero hinges on robust measurement and disclosure of
emissions-especially Scope 3 emissions from financed activities-alongside
clear interim decarbonisation targets and verification methods, which remain
under development. While the Green/Social Credit package is promising, the
criteria for evaluating and monitoring financed projects need further
formalisation to guard against claims of greenwashing and to ensure
high-quality impact. Moreover, extending operational efficiency and
sustainable practices across all branches and services will require
substantial investment and cultural change.
As competitors and regulators intensify ESG expectations, sustaining
early-mover advantages will demand deeper, outcome-based integration into risk
assessment, product design, and corporate strategy.
Military Bank ("MBB")
As at 30 June 2025
VietNam Holding's investment
Date of first investment 25 May 2017
Ownership 0.2%
Percentage of NAV 7.8%
Internal rate of return (annualised) 15.1%
Share information
Stock Exchange HOSE
Date of listing 1 Nov 2011
Market capitalisation (USD million) 6,035.37
Free float 68.7%
Foreign ownership 23.24%
Financial indicators (as at 31 December) 2024 2023
Equity (USD million) 4,481.5 3,799.3
TOI (USD million) 2,121.4 1,858.4
NPAT (USD million) 866.5 812.3
EPS (VND) 3,724 3,164
TOI growth 14.2% -3.9%
NPAT growth 6.7% 9.6%
ROA 2.2% 2.5%
ROE 21.5% 23.9%
CAR 11.8% 10.8%
NPL 1.6% 1.6%
Equity multiplier 9.6 9.8
About the Company
Founded in 1994, MBB is the fifth largest bank in Vietnam by total assets. It
listed its shares on the Ho Chi Minh City Stock Exchange in 2011. As of 2024,
MBB operated 320 branches and transaction offices, employed 18,639 staff, and
held loan and deposit market shares of 5.0% and 4.9%, respectively.
MBB has committed to its vision of becoming a "Digital Corporation and Leading
Financial Group," with a strong focus on sustainable development, improving
operational quality, and pursuing long-term strategic investments.
MBB earned several prestigious recognitions, including being ranked Top 3
among commercial banks by profit and Top 2 strongest brands in Vietnam. It is
also recognised as one of the few banks in the country with a fully integrated
and synchronised digital ecosystem. Key awards and accolades include 'Best FX
Bank in Vietnam' by The Asian Banker, 'Outstanding Bank in Green Credit' by
International Data Group ("IDG"), 'Top 25 Leading Listed Brands' by Forbes,
and a Credit rating of BB with a Stable outlook from Fitch Ratings.
Recent Developments
In 2024, net profit after tax ("NPAT") grew by 6.7% YoY, reaching USD 866.5
million. Total credit rose by 24.5% YoY, while customer deposits increased by
20% YoY. The CASA ratio stood at 39.3%, one of the highest in the industry.
Credit quality remained solid, with a low non-performing loan ("NPL") ratio of
just 1.4%.
Profitability indicators remained high with ROE of 21.5% and ROA of 2.2%,
reaffirming MBB's top-tier position in the industry.
Sustainability Strategy
MBB has reinforced its pioneering role in ESG initiatives, spearheading the
green finance movement, implementing social responsibility programs, and
enhancing risk management in line with international standards. In 2025, MBB
executed a brand strategy under the message "Sustainable - Modern," embedding
ESG into long-term operations, strengthening governance to international
standards, and reducing costs and non-performing loans.
ESG Achievements
MBB has made substantial progress embedding sustainability into its digital
transformation and operational models. In 2023, it digitised nearly 100% of
internal processes and transactions-reducing paper usage dramatically-and
introduced the "Hi Green" campaign, empowering customers to plant trees via
its app and raising VND 8.1 billion to convert landfills into community
eco spaces. By mid-2024, green credit reached VND 63.6 trillion (≈9.5%
of total lending), focusing on renewable energy, clean industries, and
sustainable agriculture. MBB also received recognition as a "Sustainable
Workplace" and "Best Place to Work in Asia" by HR Asia. Governance
integration has been reinforced through clear ESG oversight, evident from its
dedicated sustainability strategy aligned to UN SDGs and board-level ESG
steering.
ESG Challenges
Despite notable strides, MBB must address several ongoing ESG challenges. With
green lending making up under 10% of its portfolio, further scaling of
sustainable financing requires deeper sectoral diversification and robust
impact measurement frameworks. While internal digitalisation cuts resource
use, tracking environmental footprints - like carbon emissions from operations
and financed projects (Scope 3) - is still nascent. Strengthening strict ESG
risk management within credit policies, including binding environmental
criteria and long-term targets, remains necessary. Additionally, as MBB
expands its business, especially in banking and bancassurance, aligning growth
with sustainability, managing climate risk exposure, and adapting to evolving
regulations will be increasingly critical.
Sustainability Report
Global context: Navigating a Complex ESG Landscape
The second half of 2024 and the first half of 2025 were characterised by a
growing divide in the global ESG landscape. Europe continued to lead, with
stricter regulations, including the initial phase of Corporate Sustainability
Reporting Directive ("CSRD") disclosures and increased scrutiny of
greenwashing related to ESG ratings. Conversely, the US faced rising political
resistance, with several states pulling back ESG mandates, leading to outflows
from US-based sustainable funds. Despite this growing divide, green, social,
and sustainability-linked bond issuance reached a record USD 1 trillion
worldwide in 2024, an 11% rise year-on-year. However, issuance slowed
noticeably in early 2025, dropping around 32% YoY amid interest rate
pressures, geopolitical risks and changing investors' attitudes towards ESG.
Statistics indicate that support for ESG-focused resolutions among
institutional investors has decreased, particularly in the US. The four
largest asset managers worldwide-BlackRock, Fidelity Investments, State
Street, and Vanguard-are all based in the US and collectively manage USD 23tn
(£18tn) in assets. They showed very limited support for ESG proposals,
endorsing only 7% of shareholder resolutions in 2024. In contrast, UK and
European investors supported 81% of ESG resolutions, highlighting regional
differences. However, in Europe and parts of Asia, sustainable finance
continued to expand, especially in climate-focused investments and impact
funds. In 2024, the European Union reported approximately €6.6 trillion in
ESG assets under management, representing 38% of the total €17.2 trillion in
assets managed within the EU. This substantial share underscores the region's
strong commitment to integrating ESG considerations into investment
strategies. Additionally, in 2024, impact investments allocated to Asia
reached approximately USD 80 billion, a notable increase from USD 51 billion
in 2019, signalling growing interest in the region among global investors.
Remarkably, 89% of Asia-focused impact investors reported that their financial
returns were outperforming or in line with expectations, and 88% expressed
satisfaction with their impact outcomes. Looking forward, 49% of global
investors plan to increase their allocations to Southeast Asia in 2025, while
60% of Asia-focused investors intend to expand investments in East Asia,
reflecting confidence in the region's sustainable investment opportunities.
Corporate Strategy Adjustments
In 2024, many major corporations reassessed and, in some cases, scaled back
their Environmental, Social, and Governance ("ESG") commitments due to
financial pressures and political uncertainties. For example, HSBC delayed its
net-zero greenhouse gas emissions target for operations and supply chains from
2030 to 2050, citing difficulties faced by suppliers in meeting the original
deadline.
In the US, during the Trump Administration, prominent companies such as
Amazon, Google, Walmart, and Meta have scaled back or ceased their diversity,
equity, and inclusion ("DEI") programmes, influenced by political pressures
and executive orders aimed at dismantling federal DEI initiatives.
Despite these corporate adjustments, consumer demand for sustainable and
responsible business practices remains strong. A 2024 survey by Euromonitor
International showed that 45% of global consumers try to have a positive
impact on the environment through daily actions. Consumers expect corporate
climate initiatives and seek transparent proof to build their trust. As they
carefully examine the entire product lifecycle from sourcing to disposal,
choosing credible claims of carbon reduction will be vital in convincing
sustainability-focused consumers. Another survey by PwC, involving over 20,000
consumers from 31 countries and territories, revealed that 85% of consumers
are directly affected by the disruptive impacts of climate change in their
daily lives and are prioritising consumption that incorporates
sustainability-focused practices. Consumers are prepared to spend an average
of 9.7% more on sustainably produced or sourced goods, even as concerns about
the cost of living and inflation persist.
Technology's Role in ESG
The integration of AI technologies into ESG frameworks is transforming how
organisations approach sustainability. AI's ability to analyse large volumes
of data allows companies to gain deeper insights into their environmental
impact, optimise resource use, and forecast future sustainability trends. This
year, AI has played a crucial role in enhancing the accuracy and efficiency of
ESG reporting by providing real-time data analytics and enabling predictive
modelling. These capabilities not only improve operational efficiency but also
help companies proactively address potential ESG risks. Furthermore, the shift
towards data-driven ESG practices represents a significant change in how
organisations manage and report their sustainability efforts. By leveraging
advanced data analytics, organisations can monitor and evaluate their ESG
performance more accurately. This data-centric approach fosters better
decision-making, ensures compliance with regulatory requirements, and enhances
transparency. Through adopting comprehensive data analytics, companies can
identify areas for improvement, benchmark their performance against industry
standards, and communicate their sustainability successes more effectively to
stakeholders.
Vietnam context: Sustaining Green Growth Momentum
Unlike global headwinds, Vietnam's ESG momentum continued to advance into late
2024 and early 2025. The government sped up the rollout of the National Green
Growth Strategy 2021-2030 and its Resource Mobilisation Plan under the Just
Energy Transition Partnership ("JETP"). Key milestones included Vietnam's
first blue bond in 2024, supported by the International Finance Corporation
("IFC"), the debut of sustainability-linked bonds, and the pilot phase of the
national carbon market. The country also obtained its first funding under the
JETP, with the French Development Agency ("AfD") providing €67 million to
the National Power Transmission Corporation ("EVNNPT") for major transmission
projects.
Vietnam also upheld its "green carpet" FDI strategy, aligning renewable energy
infrastructure, regulatory reforms, and preferential policies to attract
high-quality sustainable manufacturing investment. This approach enhances
Vietnam's potential to become a low-carbon supply chain hub in Asia.
Over the past three years, Vietnam has continued to bolster its legal and
regulatory framework to speed up nationwide green transformation. Key
developments include:
· National Strategy on Green Growth 2021-2030 (Vision to 2050)
integrates green growth objectives into national and provincial economic
planning, emphasising sustainable urban development, energy efficiency,
renewable energy, and solid waste management.
· Law on Environmental Protection (Revised 2020) enhances
environmental management and pollution control while promoting corporate
environmental responsibility.
· Decision 687/QD-TTg (2022) - Circular Economy Development Project
establishes a national roadmap for transitioning to a circular economy,
aligning industrial growth with resource efficiency.
· Vietnam's commitment to achieve net zero by 2050 (COP26 pledge) aligns
the country with global climate objectives and supports regulatory measures
for decarbonisation initiatives.
· Power Development Plan VIII (2021-2030, Vision to 2050) approved
in 2023 and revised in 2025; sets ambitious targets for expanding renewable
energy capacity, especially solar and wind, while phasing out coal-fired
generation.
· Vietnam Green Taxonomy (2025) officially launched in July 2025,
Vietnam's inaugural green taxonomy establishes a standardised classification
of sustainable economic activities for banks, investors, and corporates,
aligning capital flows with the national green growth and net-zero roadmap.
· Hanoi and Ho Chi Minh City adopted initial directives for the
transition to electric vehicles in public transport fleets and to incentivise
EV adoption in urban areas, marking the first step in Vietnam's wider
sustainable mobility strategy.
· Decree 06/2022/NĐ-CP establishes frameworks for reducing GHG emissions
and protecting the ozone layer, including measurement, reporting, and
verification ("MRV") systems.
· Decree 119/2025/NĐ-CP introduces a domestic carbon market mechanism,
establishing the basis for emissions trading and corporate carbon pricing.
· Incentives & Support Policies (Resolution 68/2022/NQ-CP and
Resolution 198/2025/NQ-CP) provide tax incentives, preferential loans, and
feed-in tariffs for renewable energy development, alongside support for green
finance instruments and ESG disclosure standards.
At the corporate level, ESG integration progressed rapidly, driven by export
market demands and free trade agreement ("FTA") commitments. The banking
sector led with new sustainable loan frameworks and the disclosure of green
credit proportions, including CTG reporting 3.2% of total credit exposure in
green finance and ACB launching a VND 2,000 billion green/social credit
package. Overall, as of 30 September 2024, 50 credit institutions held green
outstanding loans, totalling VND 665 trillion, representing 4.5% of total
outstanding loans.
These developments emphasise Vietnam's commitment to integrating
sustainability into policy and private-sector practices, progressing steadily
towards its net-zero 2050 pledge despite global ESG turbulence.
The Fund's stewardship role
As a long-term, responsible investor, ESG integration has always been central
to our investment philosophy. With our motto "do more, measure more and report
more," we have continually advanced in our ESG journey. VNH has been a
signatory of the Principles for Responsible Investment ("PRI") since 2009,
while the Investment Manager, Dynam Capital, also became a signatory in 2022.
Our PRI Transparency Report has consistently received 5-star assessment scores
across our reporting modules over the years. Additionally, we supported a
highly successful Vietnam ESG Investor Conference 2025 as a Programme Partner.
We have proactively engaged with companies to improve the ESG practices of
investee firms, highlighting those with exemplary standards.
Identifying the implications of climate change is a vital global issue that
impacts all sectors. We support Vietnam's government and business sector
efforts to tackle climate change and its socioeconomic effects. During the
financial year, the Investment Manager has worked closely with companies to
assist them in preparing their ESG and carbon footprint reports. We are
pleased to note that the number of portfolio companies reporting their total
carbon emissions has increased this year, especially as some decided to do so
following our engagement meetings.
As we move towards a net-zero world, VNH has outlined key focus points for
climate change initiatives over the next two years:
· Continue to measure and track the portfolio's carbon footprint to
identify carbon-intensive sectors, incorporate climate risks and opportunities
into our broader risk management framework, and pinpoint investment
opportunities in low-carbon sectors.
· Improve our climate-related disclosures in accordance with the
guidelines of the Task Force on Climate-related Financial Disclosures, and
ensure disclosures align with the policies of the Task Force on Nature-related
Financial Disclosures.
· Encourage companies in the portfolio to measure their total carbon
emissions and to develop a decarbonisation roadmap.
VNH's task force on TCFD
In 2025, the Investment Manager signed an agreement with MSCI, a leading
global provider of ESG and climate data services, to improve the portfolio's
carbon emissions tracking and climate-related risk assessment. This
collaboration introduced a sophisticated digital platform that enables near
real-time monitoring of portfolio emissions and offers more comprehensive
climate and nature-related analytics. The initiative also supports the
portfolio's alignment with the Task Force on Climate-related Financial
Disclosures ("TCFD") recommendations by enhancing scenario analysis, refining
climate risk reporting, and integrating transition and physical risk
considerations into the investment process. It also helps raise the standard
of climate-related disclosures among asset managers in Vietnam and aligns with
our motto to "do more, measure more, and report more".
Leading sustainable governance
VNH's board publicly supported the Paris Agreement and TCFD in 2021. During
the Annual General Meeting that year, the board also endorsed a climate belief
statement, which was subsequently published via a media release and the Fund's
website.
Furthermore, the Company's ESG Committee has been collaborating closely with
the Investment Manager to improve its investment strategy by thoroughly
integrating climate-related risks and opportunities into the investment
process and risk management approach.
Sustainability issues are also included in reports sent to investors. Board
members and directors of the Investment Manager have attended seminars and
training sessions in the UK and Asia on climate and sustainability topics, and
they continue to promote greater adherence and cooperation. The Investment
Manager advocates for and supports climate initiatives with industry groups
such as the AIC, the Singapore Institute of Directors, AIGCC, and the Vietnam
Institute of Directors ("VIOD"), which is a member of the ASEAN Network for
Climate Governance.
Strategy for 2021-2025
As most of Vietnam's companies are in the early stages of integrating climate
change implications into their business strategies, we continue to focus our
engagement efforts on raising portfolio companies' awareness and providing
them with guidelines to measure their total carbon emissions and adopt or
develop low-carbon technologies.
We identify physical risks, such as acute weather events, as well as
transition risks, which include policy, legal, and market risks. We do this
across sectors based on our core investment themes: industrialisation,
urbanisation, and domestic consumption. In our analysis, we prioritise the
best-in-class companies regarding their adoption of technological solutions to
reduce carbon emissions and the accuracy of their disclosures on carbon
footprints in their annual reports, favouring those committed to strong
climate-resilient strategies.
Risk management
The ESG Committee collaborates closely with the Audit and Risk Committee and
the Investment Manager to incorporate climate risks into the overall risk
management framework (see page 30).
The Investment Manager incorporates climate risk assessment at every stage of
the investment process, from initial screening and due diligence to investment
decision-making and monitoring. Risks and their potential opportunities are
regularly discussed during Investment Committee meetings and managed at the
portfolio level.
Metrics and targets
· The portfolio's carbon footprint is the key metric we use to monitor
our progress in reducing carbon emissions. Our target is to keep the
portfolio's carbon footprint 20% below the benchmark index, the Vietnam All
Share Index ("VNAS"). The total emissions from scopes 1 and 2 of VNH's
portfolio in 2024 are estimated to be 65% lower than the VNAS benchmark.
· Portfolio's Weighted Average Carbon Intensity ("WACI"): We utilise
the WACI metric to evaluate the portfolio's exposure to carbon-intensive
companies, expressed in tCO2/$M revenue. The WACI for VNH's portfolio in 2024
is estimated to be 59.23 based on the Scope 1 and 2 emissions of all
companies, significantly lower than the WACI for the VNAS benchmark at 124.32.
· Low-carbon investment: From 2025 onwards, subject to shareholder
approval, we will establish a firm target percentage for low-carbon
investments in our portfolio.
Portfolio Carbon Footprint
The carbon footprint of the VNH portfolio is benchmarked against an equivalent
investment in the VNAS. As of 31 December 2024, the portfolio's Scope 1 and 2
emissions intensity was 65% lower than the VNAS benchmark, resulting in an
estimated 9,536.53 tCO₂e in avoided emissions. This substantial reduction is
mainly due to the portfolio's strategic sector allocation and preference for
companies operating in lower-emission industries. All emissions data shown in
this report have been estimated using MSCI's standardised methodology. To
improve transparency and align with TCFD recommendations, we will also publish
a dedicated climate report utilising MSCI's analytical tools and data
platform.
VNH Portfolio VNAS benchmark Difference between
VNH Portfolio vs.
VNAS benchmark
Total Emissions Scope 1&2 (tCO(2)e) 5,168.6 14,705.14 -9,536.53
Total Emissions Scope 3 (tCO(2)e) 34,871.6 58,750.87 -23,879.18
Total Emissions Scope 1,2 & 3 (tCO(2)e) 40,040.3 73,456.01 -33,415.71
Emission Intensity (tCO(2)e/ USD Million Invested) 44.11 125.51 -65%
Keeping in line with the UN SDGs
The 17 Sustainable Development Goals ("SDGs"), also known as the Global Goals,
were adopted by the United Nations ("UN") in 2015 as a universal call to
action to end poverty, protect the planet, and ensure that by 2030 all people
enjoy peace and prosperity. With just over five years remaining, it is vital
that we accelerate our efforts if we wish to achieve meaningful change. The
country's Voluntary National Review indicates that Vietnam is currently on
track to accomplish four of the 17 SDGs that the government committed to for
the 2030 Agenda. These include SDG 1, "No poverty"; SDG 6, "Clean water and
sanitation"; SDG 9, "Industry, innovation and infrastructure"; and SDG 10,
"Reduced inequalities". The year 2022 marked the 45th anniversary of Vietnam's
relationship with the UN, and together with the Government of Vietnam, the UN
launched a new five-year Sustainable Development Cooperation Framework ("CF")
for the period 2022 to 2026.
The Government of Vietnam, in collaboration with the United Nations, has
identified four key development outcomes: inclusiveness and social
development; climate change response and disaster resilience; environmental
sustainability and shared prosperity through economic transformation; and
governance and access to justice. Progress will be assessed through 46
outcomes and 57 output indicators. We have already observed the UN expanding
its dialogue in Vietnam to encourage private sector firms to adopt the UN
principles of responsible business into their operations.
The 17 SDGs form a comprehensive framework that companies should consider when
developing their sustainability strategies. We are pleased to see that the
SDGs have been included in many of our portfolio companies' annual reports,
with detailed examples of how relevant SDGs are integrated into their business
activities and corporate culture.
For example, the banking sector, which constitutes approximately 35.1% of
VNH's portfolio as of 30 June 2025, has made notable progress in committing to
the SDGs in recent years. For instance, by offering more loans and other
products associated with climate change, banks can help accelerate the
transition to clean energy and support underprivileged groups. Vietnamese
banks have also been enhancing their sustainability disclosures. During the
financial year, we observed increasing competition among banks in ESG
reporting, with TCB and ACB taking the lead.
Additionally, FPT significantly contributes to SDG 4, "Quality Education",
through their extensive education programmes for staff, their families, and
communities. GMD, another company in our portfolio, has also made efforts to
align its business with the SDGs, particularly SDG 9, "Build resilient
infrastructure, promote inclusive and sustainable industrialisation and foster
innovation with its extensive green smart port ecosystem", and SDG 13,
"Climate Action".
Six of our portfolio companies, CTG, FPT, MBB, MWG, GMD, and PNJ, are featured
in the Vietnam Sustainability Index ("VNSI"), updated in August 2025, which
ranks the top 20 sustainable listed companies on HOSE based on their ESG
practices. The number of our portfolio companies included in the VNSI
accounted for 28% of VNH's portfolio as of 30 June 2025. Three of our
portfolio companies, PNJ, CTG, and MWG, are also included in the Corporate
Sustainability Index 2024 developed by the Vietnam Business Council for
Sustainable Development ("VBCSD") under the Vietnam Chamber of Commerce and
Industry ("VCCI").
The significance of 'G' in ESG
Corporate Governance ("CG") is a vital part of any successful business as it
ensures accountability, transparency, and ethical behaviour. As investors, we
prefer companies that can demonstrate good corporate governance practices. The
CG component in our ESG scorecard has been developed based on both national
regulations and international guidelines, including the Law on Enterprises,
the Law on Securities, Decree 155 on corporate governance of public companies,
Circular 96 on disclosure of information of public companies, Vietnam's CG
Code of Best Practices for public companies, and the ASEAN CG Scorecard. It
covers a broad range of governance issues, including board structure, the
company's stated commitment to corporate governance, risk management practices
and control systems, transparency and disclosure, shareholder rights, and
board oversight of environmental and social issues.
Although Vietnam's equity markets are still classified as Frontier Markets by
MSCI and FTSE Russell, we believe it is only a matter of time before they are
upgraded. In anticipation of this, many leading companies have adopted the
World Bank's IFC ESG guidebook and other international standards to strengthen
their corporate governance frameworks. We have observed notable progress over
the past year in board-level oversight of ESG issues among our portfolio
companies. Nearly one-third of these companies have established dedicated
sub-committees to focus on key ESG matters. The majority have sent their
directors on corporate governance training courses, and more than one-third of
the portfolio companies have certified directors on their boards.
Additionally, we are pleased to see improved investor relations activities and
increased transparency across all our portfolio companies. This includes more
monthly performance updates, quarterly reports, and greater content available
in English. As mentioned above, we also see more sustainability reports from
companies following Global Reporting Initiative ("GRI") standards, which
includes enhanced investor relations support to address questions from
investors.
Dedicated company engagement programme
The Investment Manager actively arranges face-to-face meetings with several
portfolio companies through the Company Engagement Programme to discuss
business strategies and how ESG issues are managed. During the financial year,
the team continued to hold in-depth meetings with portfolio companies to help
enhance their ESG practices with practical solutions in the short and medium
term. Although each engagement and conversation varies, we observed an overall
willingness and strong commitment from the boards of our top holdings to
prioritise sustainability matters in their business agendas.
In the financial year, our engagement with investee companies concentrated on
the following ESG topics:
· Encouraging companies to enhance their ESG public disclosures
following international best practices.
· Encouraging companies to develop a decarbonisation roadmap with
science-based targets.
· Discussing how they could develop a satisfactory ESOP plan.
· Discussing the potential roles and responsibilities of an ESG
officer.
Shareholder voting
During the financial year, the Company participated in voting at the Annual
General Meetings ("AGM") for each portfolio company. This year, the AGMs were
conducted both online and in person. The Investment Manager attended 21 AGMs
on behalf of the Company and voted 99% in favour of all agenda items. The
Investment Manager evaluated each issue based on its merits, considering its
relevance to the strategic objectives of the investee company and its
long-term performance.
As part of its usual practice, the Investment Manager discusses the agenda
items with each of the investee companies' boards of directors. The voting
records were published on the Investment Manager's website.
Membership and Partnership to promote ESG practices
The PRI
The Company's investment policy aligns with the UN-supported PRI, of which the
Company has been a signatory since 2009. Each year, the Company reports on its
responsible investment activities through the PRI Transparency Report. In its
2024 Transparency Report, the Company received five-star scores across all
sections. Notably, there was an improvement in active ownership activities,
especially in areas such as the engagement approach, escalation strategy, the
number of companies engaged with, the topics covered, and how we share
insights from engagements with stakeholders.
Vietnam Institute of Directors ("VIOD")
Mr. Vu Quang Thinh, the CIO and Managing Director of Dynam Capital, is a
founder and board member of VIOD, a professional organisation that promotes
corporate governance standards and best practices in the Vietnamese corporate
sector. VIOD was officially established in 2018 with technical support from
the IFC, a member of the World Bank Group, and Switzerland's State Secretariat
for Economic Affairs ("SECO"). Controlled by a board of directors consisting
of various private sector representatives, VIOD collaborates closely with and
is supported by the State Securities Commission of Vietnam ("SSC"), HOSE, and
HNX under the Vietnam Corporate Governance Initiative ("VCGI"). With SSC's
backing, VIOD will continue to represent Vietnam in the ASEAN Corporate
Governance Scorecard. Dynam's strong collaboration with VIOD will remain
pivotal in encouraging good corporate governance in Vietnam over the coming
years.
Asia Investor Group on Climate Change ("AIGCC")
Dynam Capital, our Investment Manager, is an active participant in AIGCC.
Dynam Capital signed up for the 2024 Global Investor Statement to Governments
on the Climate Crisis, alongside 534 investors representing nearly USD 29tn in
assets under management, urging governments to increase their climate
ambitions and implement effective policies to tackle the climate crisis.
Additionally, Dynam Capital has been applying AIGCC's Investor Climate Action
Plan to develop VNH's climate strategy, while regularly attending AIGCC's
monthly member meetings (and training sessions) on climate change.
Supporting local initiatives
In the financial year, together with the Investment Manager, we actively
promoted ESG awareness in Vietnam by partnering for the Vietnam ESG Investor
Conference 2025.
Business & Human Rights: Cornerstone of Responsible Investing at VietNam
Holding Limited
Anchoring Investment in Ethical Foundations
VietNam Holding Limited ("VNH") has long recognised that sustainable,
inclusive growth must rest on a foundation of ethical and responsible business
conduct. Vietnam's rapid economic expansion continues to offer attractive
opportunities for investors; however, responsible investing in Vietnam demands
an in-depth understanding of the country's social and environmental landscape.
Recognising the increasing importance of human rights considerations in
business operations, VNH, through its investment manager, Dynam Capital, is
progressively integrating the principles of business and human rights into its
ESG investment strategy. As an early signatory of the PRI, VNH's approach has
only grown more relevant as Vietnam's development strategy increasingly aligns
with global ESG standards.
Vietnam has shown its commitment to sustainable development through various
national policies, including the National Green Growth Strategy (2021-2030),
the National Action Plan on Business and Human Rights ("NAP-BHR"), and
Resolution 68/NQ-CP, which creates a framework for economic restructuring
centred on innovation, ESG, green growth, and private sector involvement.
These policies lay a foundation for aligning investor capital with Vietnam's
social, economic, and environmental goals.
Dynam Capital, acting on behalf of VNH, has taken tangible steps to implement
responsible investment practices. This includes pre-investment ESG due
diligence using sector-specific metrics aligned with global frameworks such as
the UN Guiding Principles on Business and Human Rights (UNGPs), OECD
Guidelines, and IFC Performance Standards. Importantly, the firm also
incorporates human rights screening into its selection and monitoring of
portfolio companies, recognising the unique risks faced by vulnerable groups
such as women workers and migrant workers in manufacturing, agriculture, and
service sectors.
Human Rights as a Risk Lens and Value Driver
Business and human rights risks-ranging from labour exploitation to land
rights violations-pose significant threats to long-term company value. For
example, the apparel and agriculture sectors, which employ over 50% of
Vietnam's workforce, face increasing scrutiny from global buyers and
regulators. The European Union's Corporate Sustainability Due Diligence
Directive ("CSDDD") will, for instance, require EU-based companies to ensure
that Vietnamese suppliers uphold human rights and environmental standards
throughout their operations.
Our investment manager, Dynam Capital, has responded by working with investee
companies to adopt risk-based approaches to labour rights, including
formalising grievance mechanisms and improving workplace safety. In 2024, 100%
of investee companies paid their employees above minimum wage standards,
developed mechanisms to protect pregnant and nursing women, and adopted
policies against child labour use. These actions not only reduce reputational
and operational risks but also unlock access to ESG-conscious capital.
Aligning with Policy and International Standards
Vietnam's regulatory landscape is changing quickly to include business and
human rights within wider governance frameworks. Resolution 68, Vietnam's
strategic plan for sustainable development, explicitly calls for combining
economic growth with social fairness and environmental care. It urges
ministries and local authorities to adopt inclusive economic policies, improve
corporate transparency, and promote private sector involvement in achieving
national sustainability goals. This policy environment strengthens the role of
investors like VNH in shaping the future of Vietnamese business, not just as
providers of capital, but as custodians of ethical, rights-respecting growth.
Alongside Resolution 68, the National Green Growth Strategy and the 2023 draft
ESG guidelines have called for incorporating human rights, labour conditions,
and environmental protections into private sector standards. Meanwhile, the
Vietnamese government is preparing a National Action Plan on Responsible
Business Conduct, aligned with the UN Guiding Principles on Business and Human
Rights.
Looking Ahead: From Risk to Leadership
As Vietnam expands and diversifies its international trade and investment
connections, expectations for corporate behaviour will only increase.
Investors will play a vital role in shaping the standards of ethical and
sustainable business practices. In 2025, VNH and Dynam Capital will continue
to promote this initiative by:
· Expanding ESG and human rights due diligence throughout our
pipeline and active portfolio.
· Supporting investees in publishing non-financial disclosures
aligned with international standards.
· Advocating for greater integration of ESG principles, including human
rights and good governance, in Vietnam's investment sector.
Through these efforts, VNH aims to show that respecting human rights is not
only the right thing to do but also essential for building more resilient
companies, stronger societies, and a vibrant Vietnamese economy.
Principal Risks and Risk Management
The Board has carried out a robust assessment of the Company's emerging and
principal risks and considers with the assistance of the Investment Manager
the risks and uncertainties faced by the Company in the form of a risk matrix
and heat map. The investment management of the Company has been delegated to
the Company's Investment Manager. The Investment Manager's investment process
takes into account the material risks associated with the Company's portfolio
and the holdings in which the Company is invested. The Board monitors the
portfolio and the performance of the Investment Manager at regular Board
meetings. The principal risks and the descriptions of the mitigating actions
taken by the Board are summarised in the table below.
Key risk Description Mitigating action
Market Risk Vietnam is an increasingly open trading nation, and the changes in terms of The Board is regularly briefed on political and economic developments by the
international trade, disruption to supply chains and impositions of tariffs Investment Manager. The Investment Manager publishes a monthly report on the
could impact directly and indirectly the Vietnamese economy and the companies Company which includes information and commentary on the macroeconomic
in which the Company is invested. The Vietnamese economy can also be impacted developments in Vietnam.
by the global-macro economic conditions, and also geopolitical tensions. The
Vietnamese capital markets are relatively young, and liquidity levels can The inherent liquidity levels in the portfolio have been considered explicitly
change abruptly responding to changes in the behaviour of domestic and in the viability of the Company and the Board is reasonably satisfied that
international investors. even in periods of distress and low liquidity there would be an adequate level
of assets that could be realised to meet the liabilities of the Company as
Parts of the portfolio may be prone to enhanced liquidity and price risk. they fall due.
The Board has noted that the underlying market liquidity in Vietnam has
increased dramatically during the last year, and the portfolio composition has
also included a higher percentage of larger and more liquid companies.
Investor Sentiment Vietnam is currently classified as a Frontier Market by MSCI, and the The Investment Manager keeps shareholders and other potential investors
timetable for any inclusion as an Emerging Market is unsure. Investor regularly informed on Vietnam in general and the Company's portfolio in
attitudes to Frontier and Emerging Markets can change, leading to reduced particular. At each Board meeting the Board receives reports from the
demand for the Company's shares, and an increase in the discount to NAV per Investment Manager, from Cavendish Securities plc, its broker, and is updated
share. on the composition of the shareholder register. In 2019 the Company migrated
its domicile from Cayman Islands to Guernsey and moved its trading from AIM to
the Main Market (previously the Premium segment of the Official List) of the
LSE in order to make the shares attractive to a wider audience of potential
investors. In seeking to narrow the discount, the Board has also implemented
an on-going share buy-back programme.
Investment Performance The performance of the Company's investment portfolio could be poor, either The Board receives regular reports on the performance of the portfolio and its
absolutely or in relation to the Company's peers, or to the market as a whole. underlying assets. The Investment Manager reports to the Board at each Board
meeting, and the Board monitors the performance of the Investment Manager.
Fair Valuation The risks associated with the fair valuation of the portfolio could result in The Board reviews the valuation of the portfolio with the Investment Manager
the NAV of the Company being misstated. The quoted companies in the portfolio regularly.
are valued at market price, but it may be difficult to liquidate, where large
positions are held, at these prices in an orderly fashion in the ordinary The daily estimated NAV is calculated by the Investment Manager.
course of market activity. The values of the Company's underlying investments
are denominated in Vietnamese Dong, whereas the Company's accounts are The monthly NAV is calculated by the Fund Administrator.
prepared in US Dollars. The Company does not hedge its Vietnamese Dong
exposures so exchange rate fluctuations could have a material effect on the
NAV.
Investment Management Agreement The fund management activities are outsourced to the Investment Manager. If The Board maintains a close contact with the Investment Manager and reviews
the Investment Manager became unable to carry out these activities or if the the performance of the Investment Manager on a regular basis.
Investment Management Agreement was terminated, there could be disruptions to
the management of the portfolio until a suitable replacement is found.
Operational The Company has no employees and is dependent on a number of third parties for The Board receives regular reports from the Investment Manager and Fund
the provision of services (including Investment Management, Fund Administrator on their policies, controls, and risk management.
Administration and Custody). Any control failures or gaps in the services
provided could result in damage or loss to the Company.
Legal and Regulatory Failure to comply with relevant regulation and legislation in relevant The Company is administered in Guernsey by a Fund Administrator which reports
jurisdictions may have an impact on the Company. Although there are compliance to the Board at each Board meeting on compliance matters. The Board receives
policies (including anti-bribery policies) in place at the Company, the training and updates on compliance matters. The Investment Manager is
Investment Manager and all service providers, the Company could be damaged or regulated in Guernsey and has extensive compliance and risk management
suffer losses if any of these polices were breached. policies in place.
Climate Risk Climate change is happening faster than models earlier predicted, threatening The Board, through the Investment Manager, has engaged a specialist consulting
the safety of billions of people on the planet. Vietnam is one of the twenty firm in Vietnam to help estimate the portfolio's carbon footprint and identify
countries most vulnerable to climate change. The country's diverse geography the carbon-intensive sectors. The Investment Manager has undertaken to analyse
means it is hit by sea level rise, typhoons, landslides, flooding and the physical and transition risks of climate-sensitive industries to develop
droughts, and weather events are expected to worsen in coming years. Two types an appropriate investment and engagement strategy and to encourage investee
of climate-related risks have been identified. companies to do more on climate-related risk assessment and disclosures. The
Investment Manager monitors investee companies that are identified to be at
(1) Physical risks: sea level rise, floods and typhoons that put high climate risk.
infrastructure or real estate companies with projects in coastal areas or
low-lying levels at higher risk from physical impacts of climate change. The Investment Manager is a member of the Asia Investor Group on Climate
Change and keeps abreast of the changes in policies that may impact transition
(2) Transition risks: climate policy and rising carbon prices may cause higher and other climate-related risks. The Board is in regular contact with the
prices and impact the viability of companies that rely on fossil fuels or Investment Manager and receives reports through the ESG Committee and the
those in carbon intensive activities and may necessitate a significant, and Audit and Risk Committee.
costly, technology shift.
Emerging Risks New risks beyond those identified as Principal Risks can develop. These The Board reviews the risk matrix and risk register that captures and tracks
Emerging Risks may have a detrimental or existential impact on the Company. emerging risks as part of its overall risk management practices. Emerging
Risks are identified and recorded with a description of their root cause, a
risk assessment, a description of mitigating actions, a monitoring plan, and a
net risk rating. Changes in risk ratings are presented to the Board on a
quarterly basis. There are no emerging risks to bring to the attention of
the shareholders at the date of the Annual Report.
Currency Risk The Company is exposed to currency risk arising from its investments To manage the potential adverse effects of currency fluctuations, particularly
denominated in Vietnamese Dong ("VND"), while its functional and reporting the depreciation of the Vietnamese Dong ("VND") against the US Dollar ("USD"),
currency is the US Dollar ("USD"). A potential devaluation of the VND by the the Company employs a multi-faceted mitigation strategy. The Investment
State Bank of Vietnam ("SBV") intended to enhance export competitiveness or Manager actively monitors macroeconomic indicators such as Vietnam's current
respond to depreciation pressures from regional currencies such as the Chinese account balance and the USD/VND exchange rate, as well as the exchange rate
Yuan ("CNY") could negatively impact the value of the Company's portfolio. policy of the State Bank of Vietnam ("SBV"), including the size and frequency
Specifically, a weaker VND would reduce the USD-equivalent value of of its market interventions. In addition, the Company tracks movements in the
investments held in local currency, resulting in unrealised foreign exchange USD CNY rate, given its influence on regional currency dynamics. During
losses. Additionally, the cost of imports for portfolio companies may rise, periods of heightened foreign exchange volatility, the Company seeks to
potentially affecting their profitability and valuation. maintain a higher proportion of its cash holdings in USD to preserve value.
The portfolio construction also considers the differential impact of currency
movements on exporters and importers, recognising that VND depreciation may
benefit export-oriented companies while increasing costs for import-reliant
businesses.
Director Profiles and Disclosure of Directorships
All of the Directors are Non-executive Directors and the majority are
independent of the Investment Manager.
Hiroshi Funaki (Chairman)
Mr Funaki has been actively involved in raising, researching and trading
Vietnam funds since 1995. He worked at Edmond de Rothschild Securities from
2000 to 2015 where he led the Investment Companies team, focusing on Emerging
Markets and Alternative Assets. Prior to that he was Head of Research at
Robert Fleming Securities, also specialising in closed-end funds. He currently
acts as an investment adviser to a Family Office. He has a MA in Mathematics
and Philosophy from Oxford University.
Philip Scales (Audit and Risk Committee Chairman and Management Engagement
Committee Chairman)
Mr Scales has over 40 years' experience working in offshore corporate, trust,
and third-party fund administration. For 18 years, he was managing director of
Barings Isle of Man (subsequently to become Northern Trust) where he
specialised in establishing offshore fund structures, mainly in the
closed-ended arena (both listed and unlisted entities). Mr Scales subsequently
co-founded FIM Capital Limited and is Chairman of FIM Holdings Limited. He is
a Fellow of the Corporate Governance Institute (formerly the Institute of
Chartered Secretaries and Administrators) and holds directorships in listed
companies and collective investment schemes.
Saiko Tajima (Remuneration and Nomination Committee Chairman)
Ms Tajima has over 20 years' experience in finance, of which 8 years have been
spent in Asian real estate asset management and structured finance. Working
for Aozora Bank and group companies of Lehman Brothers and Capmark, she
focused on financial analysis, monitoring and reporting to lenders, borrowers,
auditors, regulators, and rating agencies. Over the last 10 years, she has
invested in and helped develop tech start-ups in Tokyo, Seoul, and Sydney. She
is a Certified Public Accountant in the US.
Connie Hoang Mi Vu (Environmental, Social and Governance Committee Chairman)
Ms Vu is a partner at Raise Partners, a consultancy that advises clients on
ESG strategy and partnerships. She has over 20 years of experience in ESG and
international development and is one of Vietnam's leading experts on human
trafficking, modern slavery, and labour migration. Ms Vu is Co-founder and
Vice-Chair of the Vietnam International Safe Labour Alliance, an Advisory
Board Member of the Belgium Luxembourg Chamber of Commerce Vietnam and a
Vice-Chair of the European Chamber of Commerce's Women in Business Committee.
She has a BA from University of Michigan and MPA in International Nonprofit
Policy & Management from New York University.
Disclosure of Directorships in Public Companies Listed on Recognised Stock
Exchanges
Name Company Name Stock Exchange
Philip Scales First World Hybrid Real Estate plc Channel Islands
Corporate Governance Report
The Directors are responsible for the determination of the overall management
of the Company including its investment policy and strategy. This includes the
review of investment activity, performance and control and supervision of the
Investment Manager and other advisers. The Directors are all Non-executive and
the majority are independent of the Investment Manager.
The Board is also responsible for its own composition, capital raising,
meeting statutory obligations and public disclosure, financial reporting and
entering into any material contracts on behalf of the Company.
The Directors have access to the advice and services of the Administrator and
Secretary, who are responsible to the Board for ensuring that Board procedures
are followed and that it complies with Company Law, applicable rules and
regulations of the Guernsey Financial Services Commission, the London Stock
Exchange and The International Stock Exchange.
Where necessary, in carrying out their duties, the Directors may seek
independent professional advice at the expense of the Company.
The Board of the Company has considered the Principles and Provisions of the
Association of Investment Companies Code of Corporate Governance issued in
February 2019 ("AIC Code"). The AIC Code addresses the Principles and
Provisions set out in the UK Corporate Governance Code (the "UK Code"), as
well as setting out additional Provisions on issues that are of specific
relevance to the Company. The Board and its advisors are aware of the new code
and will carry out a review to ensure that it remains compliant.
The Board considers that reporting against the Principles and Provisions of
the AIC Code, which has been endorsed by the Financial Reporting Council and
the Guernsey Financial Services Commission provides more relevant information
to Shareholders. The Board also considers by reporting against the AIC Code,
they are meeting their obligations under the UK Code, the 2011 GFSC Finance
Sector Code of Corporate Governance and associated disclosure requirements
under paragraph 9.8.6 of the Listing Rules.
The AIC Code is available on the AIC website (www.theaic.co.uk). It includes
an explanation of how the AIC Code adapts the Principles and Provisions set
out in the UK Code to make them relevant for investment companies.
Except as disclosed within this report, the Board is of the view that the
Company complied with the recommendations of the AIC Code and the relevant
provisions of the AIC Code during the year ended 30 June 2025. Key issues
affecting the Company's corporate governance responsibilities, how they are
addressed by the Board and application of the AIC Code are presented below.
Liaison with Shareholders is dealt with by the Chairman of the Company and the
Directors working closely with the Company's Advisors.
Directors' Responsibilities to Stakeholders
Section 172 of the UK Companies Act 2006 applies directly to UK domiciled
companies, however the AIC Code requires that the matters set out in Section
172 are reported by all companies, irrespective of domicile. This requirement
does not conflict with the Companies Law in Guernsey.
Section 172 recognises that Directors are responsible for acting in a way that
they consider, in good faith, is most likely to promote the success of the
Company for the benefit of its shareholders as a whole. In doing so, they are
also required to consider the broader implications of their decisions and
operations on other key stakeholders and their impact on the wider community
and the environment.
Key decisions are defined as those that are material to the Company, but also
those that are significant to any of the Company's key stakeholder groups. The
Company's engagement with its key stakeholders is outlined on page 36 of the
corporate governance section of this report.
Board Independence and Composition
The Directors are all Non-executive and the majority are independent. Two of
the Board members were appointed in September/October 2017 following the
retirement of the previous Board and the third member was appointed in May
2019 following the retirement of a Board member at the 2018 AGM. The fourth
member was appointed in March 2024 following the resignation of two Board
members at the 2023 AGM.
Mr Funaki is a Director of Discover Investment Company which at 30 June 2025
held 1,415,776 ordinary shares in the Company representing 6.03% of the issued
share capital. The Board are satisfied that this does not have any impact on
Mr Funaki's independence as a Director of the Company.
As detailed in note 8 of the financial statements, Directors own shares in the
Company as follows:
Hiroshi Funaki 19,887
Philip Scales 10,077
Saiko Tajima 5,000
The Board reviews the independence of the Directors regularly and at least
annually.
The Board acknowledges the benefits of greater diversity and welcomes the
recommendations from the Hampton-Alexander Review on gender diversity and the
Parker Review on ethnic representation. The Remuneration and Nomination
Committee will consider diversity generally when making recommendations for
appointments to the Board but with the principal aim that any new appointment
is filled by the most appropriate candidate based on a range of skills,
knowledge and experience appropriate for an investment trust.
In all of the Board's activities, there has been and will be no discrimination
on the grounds of gender, race, ethnicity, religion, sexual orientation, age
or physical ability.
The Board notes the new Listing Rules requirements regarding the targets on
board diversity:
· at least 40% of individuals on the Board are women;
· at least one senior Board position (chairman, chief executive
officer ("CEO"), senior independent director or chief financial officer
("CFO")) is held by a woman; and
· at least one individual on the Board is from a minority ethnic
background, defined to include those from an ethnic group other than a white
ethnic group, as specified in categories recommended by the Office for
National Statistics.
As required by the Listing Rules, reporting against these targets is set out
in the tables below in the prescribed format. The data was collected on a
self-identifying basis.
Gender identity/ sex No of Board Members Percentage of Board No of senior positions on the Board Number in Executive team Percentage of Executive Team
Male 2 50% 2 - N/A
Female 2 50% 2 - N/A
Not specified - - - - N/A
Ethnic Background No of Board Members Percentage of Board No of senior positions on the Board Number in Executive team Percentage of Executive Team
White British or other (including other minorities 1 25% 1 - N/A
Asian/ Asian British 3 75% 3 - N/A
Mixed/ multiple Ethnic groups - - - - N/A
Not specified - - - - N/A
The Board is pleased to announce that since March 2024, the board has
maintained a 50% gender balance in its composition.
The Company is an externally managed investment trust meaning there is no CEO
or CFO, however the Board considers that the Chairman of any of the Company's
Committees to be a senior position.
The Board notes also that 40% of the team members employed by the Investment
Manager and its subsidiary in Vietnam are female and 90% are ethnically
Vietnamese.
The Board believes the current board members have the appropriate
qualifications, experience, and expertise to manage the Company. The
Directors' biographies can be found on page 31.
Board Meetings and Attendance
The Board meets regularly during the year with representatives from the
Investment Manager present. In addition, representatives from the Company's
Broker and Administrator attend Board and committee meetings by invitation. At
each quarterly Board meeting the performance of the portfolio is formally
reviewed and during the year, Board members also attend investment meetings
with members of the Investment Manager's senior team. The Board members have a
range of skills covering investment management, banking, compliance, ESG and
corporate governance as well as prior experience of acting as directors of
companies listed on the London Stock Exchange.
The Company's brokers and lawyers are consulted on any matters where external
expertise is required, and external advisers attend board meetings as invited
by the Chairman to report on and/or discuss specific matters relevant to the
Company.
During year 4 Board meetings were held and the record of attendance at each
Board and committee meeting was as follows:
Board Audit and Risk Remuneration and Nomination Management Engagement Environmental, Social and Governance
Hiroshi Funaki 4 (4) 4 (4) 2 (2) 2 (2) 2 (2)
Philip Scales 4 (4) 4 (4) 2 (2) 2 (2) 2 (2)
Saiko Tajima 4 (4) 4 (4) 2 (2) 2 (2) 2 (2)
Connie Hoang Mi Vu 4 (4) 4 (4) 2 (2) 2 (2) 2 (2)
Re-election of Directors
The Board has agreed that all Directors should submit themselves for annual
re-election.
Mr Funaki, Mr Scales, Ms Tajima and Ms Vu will all stand for re-election at
the 2025 AGM.
The individual performance of each Director standing for re-election or
election has been evaluated by the other members of the Board and a
recommendation will be made that Shareholders vote in favour of their
re-election at the AGM in December 2025.
Administration
On 7 October 2019 the Board appointed Apex Fund and Corporate Services
(Guernsey) Limited to provide corporate governance, secretarial, compliance
and accounting services to the Company.
Conflicts of Interest
The Directors are reminded at each Board meeting of their obligations to
notify any changes in their statement of conflicts and also to declare any
benefits received from third parties in their capacity as a Director.
A register of conflicts is maintained by the Administrator and formally
reviewed on a quarterly basis. Each Director is required to declare any
potential conflicts of interest on an ongoing basis.
Performance Evaluation
During the year the Board undertook an evaluation exercise into the
effectiveness of both the Board and the Committees. The programme was
undertaken by the Administrator and no significant issues were identified.
The Remuneration and Nomination Committee will again consider whether for the
next evaluation due in 2026, an external facilitator should be appointed to
undertake the evaluations in line with AIC recommendations.
Professional Development and Training
New Directors are provided with all relevant information regarding the
Company's business and given the opportunity to meet with key functionaries
prior to appointment. They are also provided with induction training.
It is the responsibility of each Director to ensure that they maintain
sufficient knowledge to fulfil their role and so are encouraged to participate
in seminars and training courses where appropriate.
Committees of the Board
Four Committees have been formed, an Audit and Risk Committee, a Remuneration
and Nomination Committee, a Management Engagement Committee and an ESG
Committee. Since September/October 2017 the Company has been through a period
of considerable change and apart from the Management Engagement Committee, all
Board members are members of each committee. The Chairman of the Company does
not Chair any of the Committees.
Details of the Chairman of each committee, together with the number of
meetings held during the year are shown on pages 34 to 36. A summary of the
Terms of Reference of each committee is detailed below and a copy of the Terms
of Reference are available on the Company's website www.vietnamholding.com.
Audit and Risk Committee
The Chairman of the Audit and Risk Committee is Philip Scales and the
Committee meets at least twice per annum. All members of the Board are members
of the Committee. This includes the Chairman of the Company where, given the
size of the Board, the experience of all members and the independence of the
Company Chairman, it is felt appropriate that all Board members play a role in
the Audit and Risk Committee. The principal responsibility of the Committee is
to monitor the production of the Interim and Annual Financial Statements and
to present these to the Board for approval.
Other duties include reviewing the internal financial controls and monitoring
third party service providers, review and monitor the external auditor's
independence and objectivity along with the effectiveness of the audit process
and to make recommendations to the Board in relation to the appointment of the
External Auditor together with their remuneration.
A report of the Audit and Risk Committee is detailed on pages 38 to 39.
Remuneration and Nomination Committee
The Remuneration and Nomination Committee is chaired by Saiko Tajima and all
members of the Board are members of the Committee. The Board considers that a
majority of the Directors are independent and therefore eligible to be members
of the Committee. The Committee meets at least once in each year and at such
other times as may be considered necessary.
The principal duties of the Remuneration and Nomination Committee are to
review the fees paid to the Non-executive Directors, to consider the
appointment of external remuneration consultants, to review the structure,
size and composition of the Board, make recommendations to the Board for any
changes and to consider succession planning. The Committee also undertakes the
evaluation of the appointment of any additional or replacement Directors and
ensures they are provided with training and induction. The Committee arranges
for an annual evaluation of all Board and Committee members.
During the year the Committee reviewed the fees paid to Directors and resolved
that no changes be recommended.
Management Engagement Committee
The Chairman of the Management Engagement Committee is Philip Scales and the
Committee shall meet at least once a year. All members of the Board other than
Saiko Tajima are members of the Committee. The principal duties of the
Committee are to review the performance and appointment of the Investment
Manager together with their remuneration and to review the effectiveness and
competitiveness of the other main service providers and functionaries together
with reviewing their performance.
A share buy-back sub-committee consisting of Hiroshi Funaki and Philip Scales
has been formed under the Management Engagement Committee and meets
periodically to review and monitor the share buy-back programme.
During the year the Committee reviewed the performance of the Investment
Manager, Administrator and Sub-Administrator, Corporate Broker and Registrar.
No changes were recommended as a result of these reviews.
Environmental, Social and Governance Committee
The ESG Committee was established in 2021 and is chaired by Connie Hoang Mi Vu
with all members of the Board forming the Committee. The aim of the Committee
is to establish a unified view of ESG, increasing understanding of all three
aspects: environmental, social and governance, and to promote the robust
standards of corporate governance that the Company adopts.
The purpose of the ESG Committee, which shall meet at least once a year, is to
support the Company's on-going commitment to environmental, health and safety,
corporate social responsibility, corporate governance, sustainability, and
other public policy matters relevant to the Company (collectively, "ESG
Matters").
Shareholder Engagement
The Company is committed to listening and communicating openly with its
Shareholders to ensure that its strategy, business model and performance are
clearly understood. All Board members have responsibility for Shareholder
liaison. Shareholder contact is dealt with by the Chairman of the Company and
the Directors in close liaison with the Company Advisors.
Copies of the Annual Report are sent to all Shareholders and can be downloaded
from the website. Other Company information including the Interim Report is
also available on the website.
The Company holds an AGM each year, which gives investors the opportunity to
enter into dialogue with the Board and for the Board to receive feedback and
take action as necessary. The Investment Manager also participates in meetings
with investors arranged by the Company's Broker and has arranged seminars and
webinars to update current and prospective investors on the developments in
the Vietnamese market and the performance of the Company. The Investment
Manager also updates the Company's website and sends out monthly factsheets on
the Company to investors who have registered to receive such updates. The
Company has a LinkedIn page which is administered by the Investment Manager.
The Board reviews proxy voting reports and any significant negative response
is discussed with relevant Shareholders and, if necessary, where appropriate
or possible, action is taken to resolve any issues. In the interest of
transparency and best practice, the level of proxy votes (for, against and
vote withheld) lodged on each resolution is declared at all general meetings
and announced.
Corporate Policies
Anti-Bribery and Corruption Policy
The Board is committed to the prevention of bribery throughout the
organisation and will take every step necessary to ensure to the best of its
ability that business is conducted fairly, honestly and openly. It has adopted
a formal policy to combat fraud, bribery and corruption and will seek annual
confirmation from the Investment Manager and other service providers it
engages that they have similar policies in place. Furthermore, the Board has
zero tolerance to the criminal facilitation of tax evasion. These policies
apply to the Company and to each of its Directors. Further, the policies are
shared with each of the Company's service providers, each of which confirms
its compliance annually to the Board.
Criminal Facilitation of Tax Evasion Policy
The Board has taken steps to ensure there is no criminal facilitation of tax
evasion. This applies to the Company and to each of its Directors, as well as
service providers. A policy has been adopted by the Board.
General Data Protection Regulation
The Company abides by general data protection regulation. As it is established
in the Bailiwick of Guernsey, under The Data Protection (Bailiwick of
Guernsey) Law, 2017, the Company has registered with the Office of the Data
Protection Authority.
The Company
Global Greenhouse Gas Emissions
The Company has no significant greenhouse gas emissions to report from its
operations for the year to 30 June 2025, nor does it have responsibility for
any other emission producing sources. The Company is very conscious of its own
carbon footprint in carrying out its business activities. The main source of
this for the Company is in the international and domestic air travel of the
Board of Directors and members of the Investment Manager in conducting the
business of the Company and meeting with Shareholders. During the year members
of the Board travelled to Vienna, London, Madrid and Ho Chi Minh City in
conducting the business of the Company whilst some meetings were held via
video conference. The estimated carbon footprint of travel activities (that
have not already been offset at source) amounts to approximately 46.41 tonnes
of CO(2)e(.)
The Company engaged a specialist consulting firm to estimate the carbon
footprint of the portfolio, and this is detailed in the Sustainability Report
(pages 20 to 25).
Gender Metrics
The Board of the Company recognises the governance mechanism to ensure there
is diversity amongst the Directors and as such the Board now achieves a 50/50
gender representation. The Board is committed to treating all equally and
considers all aspects of diversity including gender and ethnic diversity. The
Remuneration and Nomination Committee will consider diversity when making
recommendations for appointments to the Board but with the principal aim that
any new appointment is filled by the most appropriate candidate based on a
range of skills, knowledge and experience appropriate for an investment trust.
Audit and Risk Committee Report
The main items that the Audit and Risk Committee (the "Committee") has
considered and reviewed during the year ended 30 June 2025 were:
● the content of the Interim Report and the Annual Report;
● the independence and effectiveness of the External Auditor;
● the internal control and risk management systems and the work of
the service providers; and
● the control framework with the assistance of the Investment
Manager and Administrator.
Internal Control
As a company with a Board consisting of Non-executive Directors and which
outsources the day-to-day activities of portfolio management, administration,
accounting and company secretarial to external service providers, the Board
considers the provision of an internal audit function is not relevant to the
position of the Company.
The Committee reviews the internal financial control systems for their
effectiveness and through the Management Engagement Committee, monitors the
performance of the external service providers. The Board recognises its
ultimate responsibility for the Company's system of internal controls to
ensure the maintenance of proper accounting records, the reliability of the
financial information upon which business decisions are made and that the
assets of the Company are safeguarded. Through these procedures, the Directors
have kept under review the effectiveness of the internal control system
throughout the year and up to the date of this report. There were no issues
arising from this review.
Membership and Attendance
The Committee membership currently consists of all Board members under the
Chairmanship of Philip Scales. This includes the Chairman of the Company
where, given the size of the Board, the experience of all members and the
independence of the Company Chairman, it is felt appropriate that all Board
members play a role in the Audit and Risk Committee. The Terms of Reference
allow appointments to the Committee for a period of up to 3 years and this may
be extended for two further 3-year periods provided that the Director remains
independent.
The Committee holds at least two meetings a year which are to review the
Annual and Half-Year Reports of the Company and also for audit planning
purposes and a review of risks relevant to the Company. Details of the number
of committee meetings held during the year ended 30 June 2025 and the number
of those attended by each committee member are shown on page 34.
The External Auditor is invited to attend committee meetings where the Annual
and Half-Year Reports are considered, and separate meetings are held with the
External Auditor where the Investment Manager is not present.
Principal Duties
During the year the Committee has:
● monitored the integrity of the financial statements of the Company and
any formal announcements relating to the Company's financial performance;
● reviewed the Company's internal financial controls and the
internal control and risk management systems of the Company and its
third-party service providers;
● made recommendations to the Board in relation to the appointment
of the External Auditor and their remuneration;
● reviewed and monitored the External Auditor's independence and
objectivity and the effectiveness of the audit process; and
● challenged the Investment Manager on the scenarios used to support the
going concern basis and the ongoing viability assessment.
A copy of the Terms of Reference of the Committee is available either from the
Company's website or from the Company's Administrator.
Valuation of Investments
The fair value of the Company's investments at 30 June 2025 was USD 113.7
million which represented 96.64% of the Company's NAV (30 June 2024: USD 134.9
million and 96.30% respectively). The valuation of investments is the most
significant factor in relation to the accuracy of the financial statements.
The Committee reviewed the portfolio valuation as at 30 June 2025 and obtained
confirmation from the Investment Manager that the Company's policies on the
valuation of investments had been followed. The Committee also made enquiries
of the Sub-Administrator and Custodian, both of whom are independent of the
Company, to check procedures are in place to ensure the portfolio is valued
correctly.
The Committee agreed to the approach to the audit of the valuation of
investments with the External Auditor prior to the commencement of the audit.
All the investments will be independently checked by the External Auditor. The
results of the audit in this area were reported by the External Auditor and
there were no significant disagreements between the Investment Manager, the
Sub-Administrator and the External Auditor's conclusions.
The Board reviews the changes in valuations at each quarterly Board meeting.
External Audit
KPMG Channel Islands Limited ("KPMG") has been the External Auditor since the
Company re-domiciled in Guernsey on 25 February 2019. The Committee held
meetings with KPMG before the start of the audit to discuss formal planning
and to discuss any possible issues along with the scope of the audit and
appropriate timetable. Informal meetings have also been held with the Chairman
of the Committee in order that the Chairman is kept up to date with the
progress of the audit and formal reporting required by the Committee.
Annually, the Committee reviews the performance of KPMG in order to recommend
to the Board whether or not the Auditors should be reappointed for the next
year.
Audit fees payable to KPMG for 2025 are GBP 72,252 (2024: GBP 66,900). Non
audit fees payable to KPMG for 2025 were GBP nil (2024: GBP nil).
The Committee has reviewed KPMG's report on their independence and
objectivity, including their structure for the audit of the Company and is
satisfied that the services provided by KPMG do not prejudice its
independence. The Committee will continue to review any non-audit services
that may be provided by KPMG in order to ensure their continuing independence
and integrity.
Risk Management
An outline of the risk management framework and principal risks is detailed on
pages 28 to 30. The Committee will keep under review financial and operational
risk including reviewing and obtaining assurances from key service providers
for the controls for which they are responsible.
Anti-Bribery and Corruption
The Company has a zero-tolerance approach to bribery and corruption, in line
with the UK Bribery Act 2010. An Anti-Bribery and Corruption Policy has been
adopted and is kept under review.
Annual Report
The Committee has reviewed the Annual Report along with reports and
explanations from the Company's Investment Manager, Administrator, and other
service providers. The Committee is satisfied that the Annual Report is fair,
balanced, and understandable and that it provides the necessary information
for Shareholders to assess the Company's performance, business model, and
strategy.
The Committee is satisfied that KPMG has fulfilled its responsibilities in
respect of the annual audit and has recommended that KPMG be re-appointed for
the forthcoming financial year.
Philip Scales
Audit and Risk Committee Chairman
30 September 2025
Directors' Remuneration Policy and Report
Remuneration Policy
The Directors are entitled to receive fees for their services which reflect
their experience, and the time commitment required. At the Annual General
Meeting to be held in December 2025 an ordinary resolution seeking approval
for the Directors' remuneration report will be put to Shareholders.
Directors' Remuneration
Directors' fees are paid within limits established in the Articles of
Incorporation which shall not exceed an aggregate of USD 350,000 in any
financial year (or such sum as the Company shall from time to time determine).
The Directors may also be paid reasonable travelling, hotel and other
out-of-pocket expenses properly incurred in attending Board, committee
meetings or general meetings. The Remuneration Committee reviews the
Directors' fees periodically although the review will not necessarily result
in any increase. For the year ended 30 June 2025 annual Directors' fees
remained at USD 50,000 with the Chairman of the Company receiving an
additional USD 10,000 per annum or prorated as applicable and the Chairman of
the Audit and Risk Committee receiving an additional USD 5,000 per annum or
prorated as applicable.
The Directors are also paid a per diem fee of USD 1,500 for each Board meeting
attended and USD 750 for a committee meeting attended, either in person or by
telephone.
The Company has no bonus schemes, pension schemes, share options or other
long-term incentive schemes in place for the Directors.
The single total figure of remuneration for each Director who served during
the year ended 30 June 2025 and the previous year is as follows:
Year ended 30 June 2025 Year ended 30 June 2024
Additional Additional
Base Fees Ad hoc Fees Total Base Fees Ad hoc Fees Total
Director USD USD USD USD USD USD
Hiroshi Funaki (Chairman) 60,000 9,750 69,750 60,000 6,750 66,750
Philip Scales (Audit and Risk Committee Chairman) 55,000 9,000 64,000 55,000 6,000 61,000
Saiko Tajima 50,000 9,750 59,750 50,000 6,000 56,000
Connie Hoang Mi Vu 50,000 9,750 59,750 13,320 1,500 14,820
Sean Hurst (Resigned) - - - 27,759 3,078 30,837
Damien Pierron (Resigned) - - - 25,000 3,215 28,215
Total 215,000 38,250 253,250 231,079 26,543 257,622
Directors' Report
The Directors present the Annual Report and Financial Statements of the
Company for the year ended 30 June 2025.
The Company
VietNam Holding Limited (the "Company") is a closed-end investment company
that was incorporated in the Cayman Islands on 20 April 2006 as an exempted
company with limited liability under registration number 166182. On 25
February 2019, the Company, via a process of cross-border continuance,
transferred its legal domicile from the Cayman Islands to Guernsey and was
registered as a closed-ended company limited by shares incorporated in
Guernsey with registered number 66090.
The investment objective of the Company is to achieve long-term capital
appreciation by investing in a diversified portfolio of companies that have
high growth potential at an attractive valuation.
At the Extraordinary General Meeting held on 21 December 2023 the Shareholders
voted in favour of the continuance resolution, authorising the Company to
operate in its current form through to the 2028 Annual General Meeting when a
similar resolution will be put forward for Shareholders' approval.
Dynam Capital, Ltd has been appointed as the Company's Investment Manager and
is responsible for the day-to-day management of the Company's investment
portfolio in accordance with the Company's investment policies, objectives and
restrictions.
Annual Redemption Facility
At the Extraordinary General Meeting of the Company held on 21 December 2023
shareholders voted in favour of a proposal that introduced an innovative
redemption structure that gives shareholders an annual opportunity to realise
their holding in the Company at fair market value. The first Redemption Point
was on 30 September 2024 and every year thereafter.
As part of the introduction of the redemption facility the Company was
accepted into the Reporting Fund regime by HMRC with effect from 1 July 2024.
Further details on the tax consequences are detailed in the Circular dated 27
November 2023.
Shareholders are advised to consider their investment objectives and their own
individual financial and tax circumstances and should seek independent
professional tax advice and advice from their own independent financial
adviser authorised under the Financial Services and Markets Act 2000 as
appropriate.
Results
The net loss for the year ended 30 June 2025 amounted to USD 2,850,696 (2024:
net profit of USD 26,522,608). There were no dividends declared during the
year ended 30 June 2025 (2024: USD nil).
Going Concern
The financial position of the Company, its cash flows and liquidity position
are described in Financial Statements and the Notes to Financial Statements.
These also contain the Company's objectives, policies, processes for managing
its capital, its financial risks management objectives, details of its
financial instruments, and its exposures to credit risk and liquidity risk.
The Company's forecasts and projections have been stress tested taking into
account the potential for (i) asset value declines, (ii) declines in cash
dividends from equities held in the portfolio and (iii) share buybacks and
tender offers. The Directors note that the underlying liquidity of Vietnamese
stocks has continued to improve during the year. The Director's also note
that the portfolio is composed of a high percentage of larger and more liquid
stocks. Lastly, the Directors note that at year-end the portfolio is comprised
of cash and quoted stocks only. The Company's liquidity position, taking into
account cash held and with the ability to sell underlying assets to meet share
buybacks, tenders and to meet the operating costs of the Company, shows that
the Company is able to operate with appropriate liquidity and be able to meet
its liabilities as they fall due.
At the Annual General Meeting and Extraordinary General meeting held on 21
December 2023, shareholders voted in favour of the Company continuing for a
further five years as well as the introduction of an annual Redemption
Facility. The first Redemption Date was 30 September 2024 when a total of
3,411,748 ordinary shares were validly tendered.
On 2 September 2025, the Company announced a total of 4,198,773 ordinary
shares were validly tendered for redemption and will be redeemed under the
2025 redemption opportunity. These ordinary shares represent approximately
17.9% of the ordinary shares in issue as at 31 August 2025. The Board resolved
that the redemption price will be based on the Company's official net asset
value per share as at 30 September 2025 and it is anticipated that payments
will be made to redeeming shareholders by the end of October 2025. The
portfolio liquidity remains relatively high, and the investment manager does
not anticipate any difficulty in raising the cash required. Therefore, the
Board is confident that the redemption facility will not cause any material
uncertainty over the going concern of the Company.
The Directors have a reasonable expectation that the Company will have
adequate resources to continue its operations for the foreseeable future.
Thus, they continue to adopt the going concern basis of accounting in
preparing the financial statements.
Viability Statement
The Board has considered the viability period for the Company, using the
criteria set out in the UK Corporate Governance Code. The Board considered the
current position of the Company, and its longer-term prospects, strategies as
well as its principal risks in the current, medium and long-term, as detailed
in the Directors' Report and in the Investment Manager's Report on pages 6 to
9, and emerging risks and uncertainties as outlined on pages 28 to 30 The
strategy provides long term direction and is reviewed annually and further
tested in a series of robust downside financial scenarios as part of the
annual review. These scenarios included an assessment of those risks that
would threaten its strategic objectives, its business-as-usual state, its
business model and its future performance, solvency or liquidity. The
sensitivity analysis was applied to the forecasted cash flows. Based on this
assessment, the Board has determined that a three-year viability period to 30
June 2028 is an appropriate period and that the Company will be able to
continue in operation and meet its liabilities as they fall due over the
period of three years. The Board notes the second redemption period being in
September 2025. Given that the Company's assets are listed equities, and that
the Investment Manager has estimated that on prevailing market conditions more
than 95% of the portfolio could be liquidated in less than 30 days, the Board
is comfortable that enough liquidity could be generated to satisfy any amount
of redemption request made by shareholders. The Board also travelled to
Vietnam in November 2024, meeting with the research team of the Investment
Manager, portfolio companies and market commentators, and will visit again in
December 2025.
In arriving at this conclusion, the Board considered:
A. The volatility of global economic conditions, the impact of trade
tariffs, the war in Ukraine and inflation:
The Board considered the impact and effectiveness of mitigation strategies
being mandated by governments in impacted countries; the adverse financial
impact already being experienced by the Company: the disruption to economic
activity and financial pressures and impact on investments in the Company's
portfolio. The Board also engaged with the Investment Manager on the
longer-term impact of climate change, and other societal change factors, to
the portfolio. Additionally, the Board took into consideration the impact on
the capital markets in Vietnam; the existence and effectiveness of business
continuity plans of the Company and its service providers that had been tried
and tested during the COVID-19 pandemic. The Board reviewed macro-reports and
updates from the Investment Manager detailing the impacts of rising inflation
and rising interest rates in the US and Europe on Vietnam, risks of global
recession and also the direct impacts of the continuing war in Ukraine. The
Board also kept a close watch on the developing global trade tensions and the
various tariff schemes being negotiated by the US Government.
B. Business environment:
Despite the continuing visible signs of economic recovery which the Board were
able to see first-hand on their visit to Vietnam in November 2024, evidenced
in part by greater tourist arrivals (back to pre-pandemic levels) and broader
economic recovery, the domestic real-estate market, bond market and consumer
market have faced some challenges. The Company's strategy for investing in a
portfolio of equities in Vietnam and targeting growth in the value of the
portfolio over the medium term is unchanged and this coupled with a nimble
approach to portfolio construction has helped the Company navigate the
uncertain market conditions. The combination of potential structural
opportunities that may benefit Vietnam as a destination for manufacturing, and
the opportunities within the growing domestic market provide attractive
investment opportunities. The direct impact of the war in Ukraine on Vietnam
appears to be manageable, with less than 1% of trade to Russia and Ukraine.
The levels of inflation in Vietnam are less pronounced than those in Europe
and the US, and the macro-economic position appears to be stronger than in
many other frontier and emerging economies.
C. Operations:
2024 was thankfully free from any significant operational changes. The
restrictions in place during the pandemic of 2020-2022 tested the Business
Continuity protocols of the Board, the Investment Manager and other service
providers. The smooth operation of the Company through the various
restrictions and lockdowns reassured the Board that these protocols are
effective and can, if necessary, operate effectively without the need for
physical meetings or an office presence. The Board, Investment Manager,
Administrator, and other service providers have all demonstrated that they can
work effectively and efficiently, and if needed remotely.
D. Investment:
· The liquidity of the Company's underlying portfolio is relatively
high: although average daily trading volumes on Vietnam's stock markets
declined during the first half of the year, the volumes recovered in the
second half. All investments are in listed companies which have relatively
high liquidity. At year end there were no unquoted investments and all
securities are 'Level 1'. It is estimated that 95% of the portfolio can be
readily liquidated in less than 30 days. The portfolio is un-geared and, as it
holds all listed securities, has sufficient liquidity to meet the Company's
liabilities.
· The current portfolio is low to medium risk based on assessments both
individually and in combination of liquidity risk, credit risk, interest rate
risk and currency risk. The Investment Manager and the Board review and
evaluate the portfolio on a monthly basis.
E. Principal risks:
The Board's review considered the Company's cash flows and income flows, with
reference to operational, business, market, currency, liquidity, interest rate
and credit risk associated in financial instruments set out in Note 3
(Financial Instruments and Associated Risks) and Note 4 (Operating Segments)
of the financial statements on pages 60 to 64 The statistical modelling is
used to quantify these risks, which ensures that the Company holds sufficient
financial assets and capital to mitigate the impact of these risks.
F. Incomes and expenses:
· The Company has a portfolio that generates investment income through
dividends payments. The cash dividends received can be used to partially
offset the Company's on-going expenses. In the year under review, total
on-going expenses were covered 0.46 times by investment income. In the
following year, the current investment income is forecast to cover 0.49 times
the amount of on-going expenses. In the stress-tested scenario with
significant declines in cash dividends forecasted, the investment income is
forecast to cover 0.61 times on-going expenses.
· The Company maintains a cash buffer to help meet on-going
expenses. At 30 June 2025 this was 3.8 % of NAV.
Given the adequate levels of cover set out above, the cash buffer, the
liquidity levels and the overall portfolio risk, the Board has reasonable
expectations that the Company can continue in operation and meet its
liabilities over the forecast period.
The Company's viability depends on the global economy and markets continuing
to function. The Board has also considered the possibility of a wide-ranging
collapse in corporate earnings and/or the market value of listed securities.
To the latter point, it should be borne in mind that a significant proportion
of the Company's expenses are in investment management fees linked to the
level of net assets of the Company, which are therefore variable in nature and
would naturally reduce if the market value of the Company's assets were to
fall.
In order to maintain viability, the Company has robust risk controls as set
out in the Directors' Report and the risk management and control framework
have the objectives of monitoring and reducing the likelihood and impact of
operational risks including poor judgement in decision-making, risk-taking
that exceeds the levels agreed by the Board, human error, or control processes
being deliberately ignored.
In this context, the Board considers that the prospects for economic activity
will remain such that the investment objective, policy and strategy of the
Company will be viable for the foreseeable future and through a period of at
least three years from 30 June 2025.
Key Performance Indicators ("KPIS")
To ensure the Company meets its objectives the Board evaluates the performance
of the Investment Manager at least at each quarterly Board meeting and takes
into the following performance indicators:
· NAV - reviews the performance of the portfolio
· Discount to NAV - and reviews the average discount for the
Company's share price against its peer group.
Share Capital and Share Buy-Backs
An active discount control mechanism to address the imbalance between the
supply of and demand for ordinary shares using share buybacks is employed by
the Broker and monitored by the Board. At the Annual General Meeting ("AGM")
of the Company held on 7 November 2024, the Company was granted the general
authority to purchase in the market up to 14.99% of the ordinary shares in
issue. This authority will expire at the AGM to be held in November 2025.
In the year ended 30 June 2025, 481,609 ordinary shares had been bought back
with 246,505 cancelled under the Company's share buyback - programme and
235,104 shares held as treasury shares. Since the last AGM and up to 25
September 2025, being the latest practicable date prior to publication of the
report, the Company bought back a total of 272,174 ordinary shares, of which
261,179 were held as treasury shares.
Share Buy-Backs to the Year-Ended 30 June 2025
30 June 2025 30 June 2024
Number of Number of
Shares USD'000 Shares USD'000
Opening balance at 1 July 27,284,892 (5,637) 27,725,104 (4,006)
Share issued during the year 113,500 585 - -
Shares repurchased during the year (481,609) (2,315) (440,212) (1,631)
Shares redemption during the year (3,411,748) (17,948) - -
Closing balance at 30 June 23,505,035 (25,315) 27,284,892 (5,637)
Substantial Share Interests
The following shareholders owned 5% or more of the shares in issue of the
Company, as stated on the lates share register as at 31 August 2025.
Number of Percentage of total
Shareholder ordinary shares shares in issue
Deglora S.à r.l. 4,493,637.00 19.40%
Citibank Nominees (Ireland) Designated Activity Company 2,095,854.00 8.93%
ICM 1,706,765.00 7.27%
Hargreaves Lansdown (Nominees) Limited 1,532,150.00 6.53%
Discover Investment Company 1,415,776.00 6.03%
Statement of Directors' Responsibilities in Respect of the Annual Report and
the Financial Statements
The Directors are responsible for preparing the Annual Report and Financial
Statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each
financial year. Under that law they are required to prepare the financial
statements in accordance with International Financial Reporting Standards
("IFRS") as adopted by the EU and applicable law. Under company law the
Directors must not approve the financial statements unless they are satisfied
that they give a true and fair view of the state of affairs of the Company and
of its profit or loss for that period.
In preparing these financial statements, the Directors are required to:
● select suitable accounting policies and then apply them
consistently;
● make judgements and estimates that are reasonable, relevant and
reliable;
● state whether applicable accounting standards have been followed,
subject to any material departures disclosed and explained in the financial
statements;
● assess the Company's ability to continue as a going concern,
disclosing, as applicable, matters related to going concern; and
● use the going concern basis of accounting unless they either intend to
liquidate the Company or to cease operations or have no realistic alternative
but to do so.
The Directors are responsible for keeping proper accounting records that are
sufficient to show and explain the Company's transactions and disclose with
reasonable accuracy at any time the financial position of the Company and
enable them to ensure that its financial statements comply with the Companies
(Guernsey) Law, 2008. They are responsible for such internal control as they
determine is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error, and have
general responsibility for taking such steps as are reasonably open to them to
safeguard the assets of the Company and to prevent and detect fraud and other
irregularities.
The Directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company's website.
Legislation in Guernsey governing the preparation and dissemination of
financial statements may differ from legislation in other jurisdictions.
The Directors who hold office at the date of approval of this Director's
Report confirm that so far as they are aware, there is no relevant audit
information of which the Company's auditor is unaware, and that each Director
has taken all the steps he ought to have taken as a Director to make
themselves aware of any relevant audit information and to establish that the
Company's auditor is aware of that information.
Compliance with Disclosure and Transparency Directive
We confirm that to the best of our knowledge:
● the financial statements, prepared in accordance with the
International Financial Reporting Standards as adopted by the EU ("IFRS"),
give a true and fair view of the assets, liabilities, financial position and
profit or loss of the Company; and
● the Directors' Report includes a fair review of the development
and performance of the business and the position of the issuer, together with
a description of the principal risks and uncertainties that they face.
We consider the Annual Report and Financial Statements taken as a whole, is
fair, balanced and understandable and provides the information necessary for
shareholders to assess the Company's position and performance, business model
and strategy.
For and on behalf of the Board
Hiroshi Funaki
Chairman
30 September 2025
Independent Auditor's Report to the Members of VietNam Holding Limited
Our opinion is unmodified
We have audited the financial statements of VietNam Holding Limited (the
"Company"), which comprise the statement of financial position as at 30 June
2025, the statements of comprehensive income, changes in equity and cash flows
for the year then ended, and notes, comprising material accounting policies
and other explanatory information.
In our opinion, the accompanying financial statements:
· give a true and fair view of the financial position of the Company
as at 30 June 2025, and of the Company's financial performance and cash
flows for the year then ended;
· are prepared in accordance with International Financial
Reporting Standards as adopted by the EU ("IFRS"); and
· comply with the Companies (Guernsey) Law, 2008.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing
(UK) ("ISAs (UK)") and applicable law. Our responsibilities are described
below. We have fulfilled our ethical responsibilities under, and are
independent of the Company in accordance with, UK ethical requirements
including the FRC Ethical Standard as required by the Crown Dependencies'
Audit Rules and Guidance. We believe that the audit evidence we have obtained
is a sufficient and appropriate basis for our opinion.
Key audit matters: our assessment of the risks of material misstatement
Key audit matters are those matters that, in our professional judgment, were
of most significance in the audit of the financial statements and include the
most significant assessed risks of material misstatement (whether or not due
to fraud) identified by us, including those which had the greatest effect on:
the overall audit strategy; the allocation of resources in the audit; and
directing the efforts of the engagement team. These matters were addressed in
the context of our audit of the financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these
matters. In arriving at our audit opinion above, the key audit matter was as
follows (unchanged from 2024):
The risk Our response
Valuation of Investments in securities at fair value Basis: Our audit procedures included:
The Company's investment portfolio consists of listed equity securities Internal Controls:
trading on the Vietnamese stock exchange (the "Investments"). These
$113,668,414; (2024: $134,971,131) Investments, carried at a fair value, are valued by the Company based on We evaluated the design and implementation of the key control over the
quoted prices in an active market for that instrument. valuation of Investments.
Use of KPMG Specialists:
Refer to page 39 of the Audit and Risk Committee Report, note 2d accounting
policies and note 13 disclosures Risk: We engaged our own valuation specialist to independently price Investments to
third party pricing sources.
The valuation of investments, due to their magnitude in the context of the
financial statements as a whole, is considered to be the area which has the Assessing disclosures:
greatest effect on our overall audit strategy and allocation of resources in
planning and completing our audit We considered the Company's disclosures (see notes 2b and 2d) in relation to
the use of estimates and judgements regarding the valuation of investments and
the Company's investment valuation policies and fair value disclosures in note
13 "Fair Value Information" for compliance with IFRS.
Our application of materiality and an overview of the scope of our audit
Materiality for the financial statements as a whole was set at $2,110,000,
determined with reference to a benchmark of net assets of $117,622,802 of
which it represents approximately 2.0% (2024: 2.0%).
In line with our audit methodology, our procedures on individual account
balances and disclosures were performed to a lower threshold, performance
materiality, so as to reduce to an acceptable level the risk that individually
immaterial misstatements in individual account balances add up to a material
amount across the financial statements as a whole. Performance materiality for
the Company was set at 75% (2024: 75%) of materiality for the financial
statements as a whole, which equates to $1,580,000. We applied this percentage
in our determination of performance materiality because we did not identify
any factors indicating an elevated level of risk.
We reported to the Audit Committee any corrected or uncorrected identified
misstatements exceeding $105,000, in addition to other identified
misstatements that warranted reporting on qualitative grounds.
Our audit of the Company was undertaken to the materiality level specified
above, which has informed our identification of significant risks of material
misstatement and the associated audit procedures performed in those areas as
detailed above.
Going concern
The directors have prepared the financial statements on the going concern
basis as they do not intend to liquidate the Company or to cease its
operations, and as they have concluded that the Company's financial position
means that this is realistic. They have also concluded that there are no
material uncertainties that could have cast significant doubt over its ability
to continue as a going concern for at least a year from the date of approval
of the financial statements (the "going concern period").
In our evaluation of the directors' conclusions, we considered the inherent
risks to the Company's business model and analysed how those risks might
affect the Company's financial resources or ability to continue operations
over the going concern period. The risks that we considered most likely to
affect the Company's financial resources or ability to continue operations
over this period was availability of capital to meet operating costs and other
financial commitments.
We considered whether these risks could plausibly affect the liquidity going
concern period by comparing severe, but plausible downside scenarios that
could arise from these risks individually and collectively against the level
of available financial resources indicated by the Company's financial
forecasts.
We considered whether the disclosure in note 2(b) to the financial statements
gives a full and accurate description of the directors' assessment of going
concern.
Our conclusions based on this work:
· we consider that the directors' use of the going concern basis of
accounting in the preparation of the financial statements is appropriate;
· we have not identified, and concur with the directors' assessment
that there is not, a material uncertainty related to events or conditions
that, individually or collectively, may cast significant doubt on the
Company's ability to continue as a going concern for the going concern period;
and
· we have nothing material to add or draw attention to in relation to
the directors' statement in the notes to the financial statements on the use
of the going concern basis of accounting with no material uncertainties that
may cast significant doubt over the Company's use of that basis for the going
concern period, and that statement is materially consistent with the financial
statements and our audit knowledge.
However, as we cannot predict all future events or conditions and as
subsequent events may result in outcomes that are inconsistent with judgements
that were reasonable at the time they were made, the above conclusions are not
a guarantee that the Company will continue in operation.
Fraud and breaches of laws and regulations - ability to detect
Identifying and responding to risks of material misstatement due to fraud
To identify risks of material misstatement due to fraud ("fraud risks") we
assessed events or conditions that could indicate an incentive or pressure to
commit fraud or provide an opportunity to commit fraud. Our risk assessment
procedures included:
· enquiring of management as to the Company's policies and procedures to
prevent and detect fraud as well as enquiring whether management have
knowledge of any actual, suspected or alleged fraud;
· reading minutes of meetings of those charged with governance; and
· using analytical procedures to identify any unusual or unexpected
relationships.
As required by auditing standards, we perform procedures to address the risk
of management override of controls, in particular the risk that management may
be in a position to make inappropriate accounting entries. On this audit we do
not believe there is a fraud risk related to revenue recognition because the
Company's revenue streams are simple in nature with respect to accounting
policy choice, and are easily verifiable to external data sources or
agreements with little or no requirement for estimation from management. We
did not identify any additional fraud risks.
We performed procedures including
· Identifying journal entries and other adjustments to test based on
risk criteria and comparing any identified entries to supporting
documentation; and
· incorporating an element of unpredictability in our audit
procedures.
Identifying and responding to risks of material misstatement due to
non-compliance with laws and regulations
We identified areas of laws and regulations that could reasonably be expected
to have a material effect on the financial statements from our sector
experience and through discussion with management (as required by auditing
standards), and from inspection of the Company's regulatory and legal
correspondence, if any, and discussed with management the policies and
procedures regarding compliance with laws and regulations. As the Company is
regulated, our assessment of risks involved gaining an understanding of the
control environment including the entity's procedures for complying with
regulatory requirements.
The Company is subject to laws and regulations that directly affect the
financial statements including financial reporting legislation and taxation
legislation and we assessed the extent of compliance with these laws and
regulations as part of our procedures on the related financial statement
items.
The Company is subject to other laws and regulations where the consequences of
non-compliance could have a material effect on amounts or disclosures in the
financial statements, for instance through the imposition of fines or
litigation or impacts on the Company's ability to operate. We identified
financial services regulation as being the area most likely to have such an
effect, recognising the regulated nature of the Company's activities and its
legal form. Auditing standards limit the required audit procedures to identify
non-compliance with these laws and regulations to enquiry of management and
inspection of regulatory and legal correspondence, if any. Therefore, if a
breach of operational regulations is not disclosed to us or evident from
relevant correspondence, an audit will not detect that breach.
Context of the ability of the audit to detect fraud or breaches of law or
regulation
Owing to the inherent limitations of an audit, there is an unavoidable risk
that we may not have detected some material misstatements in the financial
statements, even though we have properly planned and performed our audit in
accordance with auditing standards. For example, the further removed
non-compliance with laws and regulations is from the events and transactions
reflected in the financial statements, the less likely the inherently limited
procedures required by auditing standards would identify it.
In addition, as with any audit, there remains a higher risk of non-detection
of fraud, as this may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal controls. Our audit procedures
are designed to detect material misstatement. We are not responsible for
preventing non-compliance or fraud and cannot be expected to detect
non-compliance with all laws and regulations.
Other information
The directors are responsible for the other information. The other information
comprises the information included in the annual report but does not include
the financial statements and our auditor's report thereon. Our opinion on the
financial statements does not cover the other information and we do not
express an audit opinion or any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility
is to read the other information and, in doing so, consider whether the other
information is materially inconsistent with the financial statements, or our
knowledge obtained in the audit, or otherwise appears to be materially
misstated. If, based on the work we have performed, we conclude that there is
a material misstatement of this other information, we are required to report
that fact. We have nothing to report in this regard.
Disclosures of emerging and principal risks and longer term viability
We are required to perform procedures to identify whether there is a material
inconsistency between the directors' disclosures in respect of emerging and
principal risks and the viability statement, and the financial statements
and our audit knowledge. we have nothing material to add or draw attention to
in relation to:
· the directors' confirmation within the Viability Statement (pages
41 - 43) that they have carried out a robust assessment of the emerging and
principal risks facing the Company, including those that would threaten its
business model, future performance, solvency or liquidity;
· the emerging and principal risks disclosures describing these risks and
explaining how they are being managed or mitigated;
· the directors' explanation in the Viability Statement (pages 41 - 43)
as to how they have assessed the prospects of the Company, over what period
they have done so and why they consider that period to be appropriate, and
their statement as to whether they have a reasonable expectation that the
Company will be able to continue in operation and meet its liabilities as they
fall due over the period of their assessment, including any related
disclosures drawing attention to any necessary qualifications or assumptions.
We are also required to review the Viability Statement, set out on pages 41 -
43 under the Listing Rules. Based on the above procedures, we have concluded
that the above disclosures are materially consistent with the financial
statements and our audit knowledge.
Corporate governance disclosures
We are required to perform procedures to identify whether there is a material
inconsistency between the directors' corporate governance disclosures and the
financial statements and our audit knowledge.
Based on those procedures, we have concluded that each of the following is
materially consistent with the financial statements and our audit
knowledge:
· the directors' statement that they consider that the annual
report and financial statements taken as a whole is fair, balanced and
understandable, and provides the information necessary for shareholders to
assess the Company's position and performance, business model and strategy;
· the section of the annual report describing the work of the Audit
Committee, including the significant issues that the audit committee
considered in relation to the financial statements, and how these issues were
addressed; and
· the section of the annual report that describes the review of the
effectiveness of the Company's risk management and internal control systems.
We are required to review the part of the Corporate Governance
Statement relating to the Company's compliance with the provisions of the UK
Corporate Governance Code specified by the Listing Rules for our review. We
have nothing to report in this respect.
We have nothing to report on other matters on which we are required to report
by exception
We have nothing to report in respect of the following matters where the
Companies (Guernsey) Law, 2008 requires us to report to you if, in our
opinion:
· the Company has not kept proper accounting records; or
· the financial statements are not in agreement with the accounting
records; or
· we have not received all the information and explanations, which to
the best of our knowledge and belief are necessary for the purpose of our
audit.
Respective responsibilities
Directors' responsibilities
As explained more fully in their statement set out on page 45, the directors
are responsible for: the preparation of the financial statements including
being satisfied that they give a true and fair view; such internal control as
they determine is necessary to enable the preparation of financial statements
that are free from material misstatement, whether due to fraud or error;
assessing the Company's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern; and using the going concern
basis of accounting unless they either intend to liquidate the Company or to
cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue our opinion in an auditor's report. Reasonable
assurance is a high level of assurance but does not guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of the financial statements.
A fuller description of our responsibilities is provided on the FRC's website
at www.frc.org.uk/auditorsresponsibilities
(http://www.frc.org.uk/auditorsresponsibilities) .
The purpose of this report and restrictions on its use by persons other than
the Company's members as a body
This report is made solely to the Company's members, as a body, in accordance
with section 262 of the Companies (Guernsey) Law, 2008. Our audit work has
been undertaken so that we might state to the Company's members those matters
we are required to state to them in an auditor's report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company and the Company's members, as
a body, for our audit work, for this report, or for the opinions we have
formed.
Andrew J. Salisbury
For and on behalf of KPMG Channel Islands Limited
Chartered Accountants and Recognised Auditors
Guernsey
30 September 2025
Statement of Financial Position
As at 30 June 2025
2025 2024
Notes USD USD
Assets
Non-current assets
Investments at fair value through profit or loss 3 113,668,414 134,971,131
Total non-current assets 113,668,414 134,971,131
Current assets
Cash and cash equivalents 4,524,725 2,894,425
Accrued dividends and interest 71,944 73,797
Receivables on sale of investments 175,246 2,451,845
Total current assets 4,771,915 5,420,067
Total assets 118,440,329 140,391,198
Equity
Share capital 167,230,519 166,645,041
Reserve for own shares (192,544,450) (172,281,084)
Retained earnings 142,936,733 145,787,428
Total equity 117,622,802 140,151,385
Liabilities
Payables on purchase of investments 596,605 -
Accrued expenses 220,922 239,813
Total liabilities 817,527 239,813
Total equity and liabilities 118,440,329 140,391,198
The financial statements on pages 51 to 69 were approved by the Board of
Directors on 30 September 2025 and were signed on its behalf by
Hiroshi Funaki
Philip
Scales
Chairman of the Board of Directors
Chairman of the Audit
and Risk Committee
The accompanying notes on pages 55 to 69 form an integral part of these
financial statements.
Statement of Comprehensive Income
For the year ended 30 June 2025
2025 2024
Notes USD USD
Dividend income from equity securities at fair value through profit or loss 1,771,945 2,949,474
Net (loss)/gain from investments at fair value through profit or loss 7 (564,287) 28,035,973
Net foreign exchange loss (210,268) (277,039)
Interest income 23,466 -
Total operating income 1,020,856 30,708,408
Investment management fees 8 2,189,005 2,237,255
Advisory fees 96,584 81,744
Directors' fees and expenses 8 329,292 362,837
Custodian fees 9 119,014 127,617
Administrative and accounting fees 10 221,457 214,218
Audit fees 92,885 7,769
Other expenses 11 823,315 1,154,360
Total operating expenses 3,871,552 4,185,800
(Loss)/profit for the year (2,850,696) 26,522,608
Other comprehensive income - -
Total comprehensive (loss)/income for the year (2,850,696) 26,522,608
Basic and diluted (loss)/income per share 15 (0.11) 0.97
The accompanying notes on pages 54 to 69 form an integral part of these
financial statements.
Statement of Changes in Equity
For the year ended 30 June 2025
Reserve for Retained
Share capital own shares earnings Total
USD USD USD USD
Balance at 1 July 2023 166,645,041 (170,650,584) 119,264,820 115,259,277
Total comprehensive income for the year
Change in net assets attributable to shareholders - - 26,522,608 26,522,608
Total comprehensive income for the year - - 26,522,608 26,522,608
Transactions in shares
Repurchase of own shares (note 5) - (1,630,500) - (1,630,500)
Total transactions in shares - (1,630,500) - (1,630,500)
Balance at 30 June 2024 166,645,041 (172,281,084) 145,787,428 140,151,385
Balance at 1 July 2024 166,645,041 (172,281,084) 145,787,428 140,151,385
Total comprehensive loss for the year
Change in net assets attributable to shareholders - - (2,850,696) (2,850,696)
Total comprehensive loss for the year - - (2,850,696) (2,850,696)
Transactions in shares
Issuance of ordinary shares (note 5) 585,478 - - 585,478
Repurchase of own shares (note 5) - (2,315,011) - (2,315,011)
Redemption of ordinary shares (note 5) - (17,948,355) - (17,948,355)
Total transactions in shares 585,478 (20,263,366) - (19,677,888)
Balance at 30 June 2025 167,230,519 (192,544,450) 142,936,733 117,622,802
The accompanying notes on pages 54 to 69 form an integral part of these
financial statements.
Statement of Cash Flows
For the year ended 30 June 2025
2025 2024
Notes USD USD
Cash flows from operating activities
Total comprehensive (loss)/income for the year (2,850,696) 26,522,608
Adjustments to reconcile total comprehensive (loss)/income to net cash from
operating activities:
Dividend income (1,771,945) (2,949,474)
Interest income (23,466) -
Net loss/(gain) from investments at fair value through profit or loss 7 564,287 (28,035,973)
Net foreign exchange loss 210,268 277,039
Purchase of investments (51,028,666) (65,175,759)
Proceeds from sale of investments 74,640,301 69,503,097
Changes in working capital
Decrease in accrued expenses (18,891) (101,833)
Dividends received 1,773,798 3,258,659
Interest received 23,466 -
Net cash from operating activities 21,518,456 3,298,364
Cash flows used in financing activities
Issuance of ordinary shares 585,478 -
Repurchase of own shares (2,315,011) (1,876,969)
Redemption of ordinary shares (17,948,355) -
Net cash used in financing activities (19,677,888) (1,876,969)
Net increase in cash and cash equivalents 1,840,568 1,421,395
Cash and cash equivalents at beginning of the year 2,894,425 1,750,069
Effect of exchange rate fluctuations on cash held (210,268) (277,039)
Cash and cash equivalents at end of the year 4,524,725 2,894,425
The accompanying notes on pages 54 to 69 form an integral part of these
financial statements.
Notes to the Financial Statements
For the year ended 30 June 2025
1 The Company
VietNam Holding Limited (the "Company") is a closed-end investment company
that was incorporated in the Cayman Islands on 20 April 2006 as an exempted
company with limited liability under registration number 166182. On 25
February 2019, the Company, via a process of cross-border continuance,
transferred its legal domicile from the Cayman Islands to Guernsey and was
registered as a closed-ended company limited by shares incorporated in
Guernsey with registered number 66090.
On 8 March 2019 the Company's ordinary shares were cancelled from trading on
AIM and admitted to the Main Market (previously the Premium Segment of the
Official List), and trading on the Main Market of the London Stock Exchange
("Main Market"). On the same date the Company's shares were admitted to
listing and trading on the Official List of The International Stock Exchange
("TISE").
The investment objective of the Company is to achieve long-term capital
appreciation by investing in a diversified portfolio of companies that have
high growth potential at an attractive valuation.
At the Extraordinary General Meeting held on 21 December 2023 the Shareholders
voted in favour of the continuance resolution, authorising the Company to
operate in its current form through to the 2028 Annual General Meeting when a
similar resolution will be put forward for Shareholders' approval.
Dynam Capital, Ltd has been appointed as the Company's Investment Manager and
is responsible for the day-to-day management of the Company's investment
portfolio in accordance with the Company's investment policies, objectives and
restrictions.
Apex Fund and Corporate Services (Guernsey) Limited is the Company's
administrator.
Standard Chartered Bank (Singapore) Limited and Standard Chartered Bank
(Vietnam) Limited are the custodian and the sub-custodian respectively.
Standard Chartered Bank (Singapore) Limited is also the sub-administrator.
The registered office of the Company is 1 Royal Plaza, Royal Avenue, St Peter
Port, Guernsey, GY1 2HL.
2 Material Accounting Policies
(a) Statement of compliance
These financial statements, which give a true and fair view, have been
prepared in accordance with the International Financial Reporting Standards
("IFRSs") as adopted by the European Union ("EU") and comply with the
Companies (Guernsey) Law, 2008.
(b) Basis of preparation
The financial statements are presented in United States dollars ("USD"), which
is the Company's functional currency. The financial statements have been
prepared on a going concern basis, applying the historical cost convention,
except for the measurement of investments at fair value through profit or
loss.
Going concern
The Directors have reasonable expectations and are satisfied that the Company
has adequate resources to continue its operations and meet its commitments for
the foreseeable future and they continue to adopt the going concern basis for
the preparation of the financial statements. In making this statement, the
Directors confirm the Company's forecasts and projections have been stress
tested taking into account the potential for (i) asset value declines, (ii)
declines in cash dividends from equities held in the portfolio and (iii) share
buybacks and tender offers. The Directors note that the underlying liquidity
of Vietnamese stocks has continued to improve during the year. The
Director's also note that the portfolio is composed of a higher percentage of
larger and more liquid stocks. Lastly, the Directors note that at year-end the
portfolio is comprised of cash and quoted stocks only. The Company's liquidity
position, taking into account cash held and with the ability to sell
underlying assets to meet share buybacks, tenders and to meet the operating
costs of the Company, shows that the Company is able to operate with
appropriate liquidity and be able to meet its liabilities as they fall due.
At the Annual General Meeting and Extraordinary General meeting held on 21
December 2023, shareholders voted in favour of the Company continuing for a
further five years as well as the introduction of an annual Redemption
Facility. The first Redemption Date was 30 September 2024 when a total of
3,406,598 ordinary shares were validly tendered for redemption.
On 2 September 2025, the Company announced a total of 4,198,773 ordinary
shares were validly tendered for redemption and will be redeemed under the
2025 redemption opportunity. These ordinary shares represent approximately
17.9% of the ordinary shares in issue as at 31 August 2025. The Board resolved
that the redemption price will be based on the Company's official net asset
value per share as at 30 September 2025 and it is anticipated that payments
will be made to redeeming shareholders by the end of October 2025. The
portfolio liquidity remains relatively high, and the investment manager does
not anticipate any difficulty in raising the cash required. Therefore, the
Board is confident that the redemption facility will not cause any material
uncertainty over the going concern of the Company.
The Directors have a reasonable expectation that the Company will have
adequate resources to continue its operations for the foreseeable future.
Thus, they continue to adopt the going concern basis of accounting in
preparing the financial statements.
Critical accounting estimates and judgements
The preparation of financial statements in accordance with IFRS as adopted by
the EU requires management to make judgements, estimates and assumptions that
affect the application of policies and the reported amounts of assets and
liabilities, income and expenses.
Information about judgements made in applying accounting policies that have
the most significant effects on the amounts recognised in the financial
statements are included below:
Functional currency
The Company's shares were issued in USD and the listing of the shares on the
Main Market and TISE is in USD. The performance of the Company is measured and
reported to the investors in USD, although the primary activity of the Company
is to invest in the Vietnamese market. The Board considers the USD as the
currency that most faithfully represents the economic effects of the
underlying transactions, events and conditions.
(c) Foreign currency translation
Transactions in foreign currencies are translated into USD at the applicable
rates on the dates of the transactions. Monetary assets and liabilities
denominated in foreign currencies are re-translated to USD at the applicable
rates on the year-end date. Foreign currency exchange differences relating to
investments at fair value through profit or loss are included in the realised
and unrealised gains and losses on those investments within "Net gain/(loss)
from investments at fair value through profit or loss" on the Statement of
Comprehensive Income. All other foreign currency exchange differences relating
to other monetary items, including cash and cash equivalents, are included in
net foreign exchange gains and losses in the Statement of Comprehensive
Income.
(d) Financial instruments
A financial instrument is any contract that gives rise to a financial asset of
one entity and a financial liability or equity instrument of another entity.
(i) Classification
In accordance with IFRS 9, the Company classifies its financial assets and
financial liabilities at initial recognition into the categories of financial
assets and financial liabilities discussed below.
Financial assets
The Company classifies its financial assets as subsequently measured at
amortised cost or measured at fair value through profit or loss on the basis
of both:
● The entity's business model for managing the financial assets
● The contractual cash flow characteristics of the financial assets
Financial assets measured at amortised cost
A financial asset is measured at amortised cost if it is held within a
business model whose objective is to hold financial assets in order to collect
contractual cash flows and its contractual terms give rise on specified dates
to cash flows that are solely payments of principal and interest on the
principal amount outstanding. The Company includes in this category accrued
dividends and interest, cash and cash equivalents and receivables on sale of
investments.
Financial assets measured at fair value through profit or loss ("FVTPL")
A financial asset is measured at fair value through profit or loss if:
a) Its contractual terms do not give rise to cash flows on specified
dates that are solely payments of principal and interest (SPPI) on the
principal amount outstanding; or
b) It is not held within a business model whose objective is either to
collect contractual cash flows, or to both collect contractual cash flows and
sell; or
c) At initial recognition, it is irrevocably designated as measured at
FVTPL when doing so eliminates or significantly reduces a measurement or
recognition inconsistency that would otherwise arise from measuring assets or
liabilities or recognising the gains and losses on them on different bases.
The Company measures all its investments at FVTPL.
Financial liabilities -- Classification, subsequent measurement and gains and
losses
Financial liabilities are classified as measured at amortised cost or FVTPL.
A financial liability is classified as at FVTPL if it is classified as
held-for-trading, it is a derivative or it is designated as such on initial
recognition. Financial liabilities at FVTPL are measured at fair value and net
gains and losses, including any interest expense, are recognised in statement
of comprehensive income. Other financial liabilities are subsequently measured
at amortised cost using the effective interest method. Interest expense and
foreign exchange gains and losses are recognised in statement of comprehensive
income. Any gain or loss on derecognition is also recognised in statement of
comprehensive income.
Financial liabilities measured at amortised cost
Other financial liabilities are measured at amortised cost. The Company
includes in this category payables on purchase of investments and accrued
expenses.
(ii) Recognition and initial measurement
Financial assets and liabilities at fair value through profit or loss are
recognised initially on the trade date, which is the date that the Company
becomes a party to the contractual provisions of the instrument. Other
financial assets and liabilities are recognised on the date they originated.
Financial assets and financial liabilities at fair value through profit or
loss are recognised initially at fair value, with transaction costs recognised
in the Statement of Comprehensive Income. Financial assets or financial
liabilities not at fair value through profit or loss are recognised initially
at fair value plus transaction costs that are directly attributable to their
acquisition or issue.
(iii) Subsequent measurement
After initial measurement, the Company measures financial instruments which
are classified as FVTPL at fair value. Subsequent changes in the fair value of
those financial instruments are recorded in net gain or loss on financial
assets and liabilities at FVTPL in the Statement of Comprehensive Income.
Interest and dividends earned or paid on these instruments are recorded
separately in interest income or expense and dividend income in the Statement
of Comprehensive Income.
(iv) Derecognition
A financial asset is derecognised when the Company no longer has control over
the contractual rights that comprise that asset. This occurs when the rights
are realised, expire or are surrendered.
(iv) Derecognition
Financial assets that are sold are derecognised, and the corresponding
receivables from the buyer for the payment are recognised on the trade date,
being the date the Company commits to sell the assets.
A financial liability is derecognised when the obligation specified in the
contract is discharged, cancelled or expired.
(v) Fair value measurement
'Fair value' is the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at
the measurement date in the principal or, in its absence, the most
advantageous market to which the Company has access at that date. The fair
value of a liability reflects its non-performance risk.
When available, the Company measures the fair value of an instrument using the
quoted price in an active market for that instrument. A market is regarded as
'active' if transactions for the asset or liability take place with sufficient
frequency and volume to provide pricing information on an ongoing basis. The
Company measures instruments quoted in an active market at the last traded
price.
If there is no quoted price in an active market, then the Company uses
valuation techniques that maximise the use of relevant observable inputs and
minimise the use of unobservable inputs. The chosen valuation technique
incorporates all of the factors that market participants would consider in
pricing a transaction.
The Company recognises transfers between levels of the fair value hierarchy as
at the end of the reporting period during which the change has occurred.
Any increases or decreases in fair value are recognised in the Statement of
Comprehensive Income as an unrealised gain or loss from investments at FVTPL.
(vi) Impairment of financial assets
At each reporting date, the Company measures the loss allowance on financial
assets carried at amortised cost at an amount equal to the lifetime expected
credit losses if the credit risk has increased significantly since initial
recognition. If, at the reporting date, the credit risk has not increased
significantly since initial recognition, the Company measures the loss
allowance at an amount equal to 12-month expected credit losses. The
measurement of expected credit losses is a function of the probability of
default, loss given default (i.e. the magnitude of the loss if there is a
default) and exposure at the default. The assessment of the probability of
default and loss given default is based on historical data adjusted by
forward-looking information.
(vii) Cash and cash equivalents
Cash comprises current deposits with banks. Cash equivalents are short-term
highly liquid investments that are readily convertible to known amounts of
cash, are subject to an insignificant risk of changes in value and are held
for the purpose of meeting short-term cash commitments rather than for
investment or other purposes.
(e) Offsetting
Financial assets and liabilities are offset, and the net amount is reported in
the Statement of Financial Position when, and only when, the Company has a
legally enforceable right to set off the recognised amounts and the
transactions are intended to be settled on a net basis or simultaneously, e.g.
through a market clearing mechanism.
(f) Share capital
Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly
attributable to the issue of ordinary shares are recognised as a deduction
from equity, net of any tax effects.
Repurchase, disposal and reissue of share capital (treasury shares)
Where the Company purchases its own share capital, the consideration paid,
which includes any directly attributable costs, is recognised as a deduction
from equity shareholders' funds through the Company's reserves for own shares.
The reserves for own shares represents share capital which can be reissued in
the future or subsequently cancelled. When such shares are subsequently sold
or re-issued to the market any consideration received, net of any directly
attributable incremental transaction costs, is recognised as an increase in
equity shareholders' funds through the reserve of own shares account.
(g) Tax
Tax expense comprises current tax. Current tax is recognised in the Statement
of Comprehensive Income except to the extent that it relates to items
recognised directly in equity or in other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or
loss for the year, using tax rates enacted or substantively enacted at the
reporting date, and any adjustment to tax payable in respect of previous
years.
The Company is a tax resident in Guernsey and is subject to the standard rate
of 0% on taxable income.
The Company is liable to Vietnamese transactional tax of 0.1% (2024: 0.1%) on
the sales proceeds of the onshore sale of equity investments. The related
taxes on onshore sales proceeds are accounted for at net amount in the
Statement of Comprehensive Income.
(h) Interest income and expense
Interest income and expense is recognised in the Statement of Comprehensive
Income using the effective rate method. The effective interest rate method is
a method of calculating the amortised cost of a financial asset or financial
liability and of allocating the interest income or interest expense over the
relevant period. The effective interest rate is the rate that exactly
discounts estimated future cash payments or receipts throughout the expected
life of the financial instrument - or, when appropriate, a shorter period - to
the net carrying amount of the financial asset or financial liability.
When calculating the effective interest rate, the Directors estimate cash
flows considering all contractual terms of the financial instrument but do not
consider future credit losses. The calculation includes all fees and points
paid or received between parties to the contract that are an integral part of
the effective interest rate, transaction costs and all other premiums or
discounts.
(i) Dividend income
Dividend income is recognised in the Statement of Comprehensive Income on the
date on which the right to receive payment is established. For listed equity
securities, this is usually the ex-dividend date. Dividend income from equity
securities designated as at fair value through profit or loss is recognised in
the Statement of Comprehensive Income as a separate line item.
(j) Fee and commission expense
Fees and commission expenses are recognised in the Statement of Comprehensive
Income as the related services are performed.
(k) Earnings per share
The Company presents basic and diluted earnings per share data for its
ordinary shares. Basic earnings per share is calculated by dividing the profit
or loss attributable to ordinary shareholders of the Company by the weighted
average number of ordinary shares outstanding during the year, adjusted for
own shares held.
3 Financial Instruments and Associated Risks
Financial assets of the Company include investments at fair value through
profit or loss, cash and cash equivalents, receivables on sale of investments,
and accrued dividends and interest. Financial liabilities comprise payables on
purchase of investments, payables on repurchase of shares and accrued
expenses. Accounting policies for financial assets and liabilities are set out
in note 2.
The Company's investment activities expose it to various types of risk that
are associated with the financial instruments and the markets in which it
invests. The most important types of financial risk to which the Company is
exposed are market risk (which includes price risk, currency risk, and
interest rate risk), credit risk and liquidity risk.
Asset allocation is determined by the Company's Investment Manager who manages
the distribution of the assets to achieve the investment objectives.
Divergence from target asset allocations and the composition of the portfolio
is monitored by the Investment Manager.
Market risk
Market risk is the risk that the value of a financial asset will fluctuate as
a result of changes in market prices (e.g. interest rates, foreign exchange
rates, equity prices and credit spreads) whether or not those changes are
caused by factors specific to the individual asset or factors affecting all
assets in the market. The Company is exposed to market risk within its
investments purchased in the Vietnamese market.
The overall market positions are monitored continuously by the Investment
Manager and at least quarterly by the Board.
The Company's investments in securities are exposed to market risk and are
disclosed by the following generic investment types:
2025 2024
Fair value % of Fair value % of
in USD net assets in USD net assets
Investments in listed securities 113,668,414 96.64 134,971,131 96.30
113,668,414 96.64 134,971,131 96.30
At 30 June 2025, a 5% reduction in the market value of the portfolio would
have led to a reduction in NAV and profit or loss of USD 5,683,421 (2024: USD
6,748,557). A 5% increase in market value would have led to an equal and
opposite effect on NAV and profit or loss.
Currency risk
The Company may invest in financial instruments and enter into transactions
denominated in currencies other than its functional currency. Consequently,
the Company is exposed to risks that the exchange rate of its currency
relative to other currencies may change and have an adverse effect on the
value of the Company's financial assets or liabilities denominated in
currencies other than USD.
The Company's net assets are calculated every month based on the most up to
date exchange rates while the general economic and foreign currency
environment is continuously monitored by the Investment Manager and reviewed
by the Board at least once each quarter.
The Company may enter into arrangements to hedge currency risks if such
arrangements become desirable and practicable in the future in the interest of
efficient portfolio management.
As at 30 June 2025, the Company had the following foreign currency exposures:
Fair value
2025 2024
USD USD
Vietnamese Dong 117,293,753 140,090,931
Pound Sterling 2,793 6,498
Swiss Franc 197 174
Euro 4,880 4,456
117,301,623 140,102,059
At 30 June 2025, a 5% reduction in the value of the Vietnamese Dong, Pound
Sterling, Swiss Franc, Euro versus the US Dollar would have led to a reduction
in NAV and profit or loss of USD 5,864,688 (2024: USD 7,004,547), USD 140
(2024: USD 325), USD 10 (2024: USD 9) and USD 244 (2024: USD 223)
respectively. A 5% increase in value would have led to an equal and opposite
effect.
Interest rate risk
Interest rate risk is the risk that the future cash flows of a financial
instrument will fluctuate because of changes in market interest rates.
The majority of the Company's financial assets are non-interest-bearing.
Interest-bearing financial assets and interest-bearing financial liabilities
mature or reprice in the short-term, no longer than twelve months. As a
result, the Company is subject to limited exposure to interest rate risk due
to fluctuations in the prevailing levels of market interest rates.
Credit risk
Credit risk is the risk that a counterparty to a financial instrument will
fail to discharge an obligation or commitment that it has entered with the
Company.
At 30 June 2025, the following financial assets were exposed to credit risk
(including settlement risk): cash and cash equivalents, receivables on sale of
investments and accrued dividends and interest. The total amount of financial
assets exposed to credit risk amounted to USD 4,771,915 (2024: USD 5,420,067).
Substantially all the assets of the Company are held by the Company's
custodian, Standard Chartered Bank (Singapore) Limited. Bankruptcy or
insolvency of the custodian may cause the Company's rights with respect to
cash and securities held by the custodian to be delayed or limited. The
Company monitors its risk by monitoring the credit quality and financial
positions of the custodian the Company uses.
As at 30 June 2025, the Company's custodian, Standard Chartered Bank
(Singapore) Limited, was rated as A+ by Standard and Poor's, A1 by Moody's and
A+ by Fitch (2024: A+ by Standard and Poor's, A1 by Moody's and A+ by Fitch).
Concentration risk
Management identifies and monitors concentration risk through a set of
investment restrictions embedded in the Company's investment policy. These
include limits on exposure to individual companies and sectors, exclusion of
certain asset classes, and daily oversight via the Company's risk and
compliance system.
Concentrations are determined based on:
● Counterparty exposure: No more than 20% of Net asset Value ("NAV")
invested in a single investee company.
● Sector exposure: No more than 40% of NAV invested in any single
Industry Classification Benchmark ("ICB") classified sector.
● Geographical and currency exposure: The portfolio is concentrated
in Vietnam and primarily denominated in Vietnamese Dong ("VND"), exposing it
to country-specific and currency-related risks.
2025 2024
% of Equity Investments % of Equity Investments
% of Portfolio % of NAV % of Portfolio % of NAV
Banks 36% 35% 27% 26%
Retail 17% 16% 14% 13%
Real Estate 16% 15% 8% 8%
Industrial Goods and Services 11% 11% 17% 16%
Telecommunications 7% 7% 16% 15%
Financial Services 7% 7% 6% 6%
Travel and Leisure 2% 2% - -
Chemicals 2% 2% - -
Consumer Products and Services 2% 2% 2% 2%
Construction and Materials - - 4% 4%
Energy - - 6% 6%
Total 100% 97% 100% 96%
Financial assets subject to IFRS 9's impairment requirements
The Company's financial assets subject to the expected credit loss model
within IFRS 9 are cash and cash equivalents, and short-term receivables,
including accrued dividends and interest, and receivables on sale of
investments. As at 30 June 2025, the total of cash and cash equivalents, and
short-term receivables was USD 4,771,915 (2024: USD 5,420,067). The Directors
assessed the lifetime expected credit loss as at 30 June 2025 and concluded it
to be immaterial (2024: immaterial). There is not considered to be any
concentration of credit risk within these assets. No assets are considered
impaired, and no amounts have been written off in the year.
All short-term receivables are expected to be received in three months or
less. An amount is considered to be in default if it has not been received 30
days after it is due.
Liquidity risk
The Company, a closed-end investment company, invests in companies through
listings on the Vietnam stock exchanges. However, there is no guarantee that
the Vietnam stock exchanges will provide liquidity for the Company's
investments.
The Company's overall liquidity risks are monitored on at least a quarterly
basis by the Board. The Company is a closed-end investment company so
Shareholders cannot repurchase their shares directly from the Company.
The Board has considered that there may be periods of time when parts of the
portfolio are prone to higher liquidity risk, but is satisfied overall that
the fixed liabilities of the Company can be met by income or from selling
sufficient marketable securities even at periods of higher illiquidity.
Payables on purchase of investments and accrued expenses are generally payable
within one year.
The table below summarises the maturity profile of the Company's financial
assets and liabilities based on contractual undiscounted receipts and
payments:
Over
0 to 1 to 3 months No fixed
On demand 1 month 3 months to 5 years maturity Total
USD USD USD USD USD USD
2025
Cash and cash equivalents 4,524,725 - - - - 4,524,725
Investment at fair value through profit and loss - - - - 113,668,414 113,668,414
Accrued dividends and interest - - 71,944 - - 71,944
Receivables on sale of investments - - 175,246 - - 175,246
Total financial assets 4,524,725 - 247,190 - 113,668,414 118,440,329
Payables in purchase of investments - - 596,605 - - 596,605
Accrued expenses - - 220,922 - - 220,922
Total financial liabilities - - 817,527 - - 817,527
2024
Cash and cash equivalents 2,894,425 - - - - 2,894,425
Investment at fair value through profit and loss - - - - 134,971,131 134,971,131
Accrued dividends and interest - - 73,797 - - 73,797
Receivables on sale of investments - - 2,451,845 - - 2,451,845
Total financial assets 2,894,425 - 2,525,642 - 134,971,131 140,391,198
Accrued expenses - - 239,813 - - 239,813
Total financial liabilities - - 239,813 - - 239,813
4 Operating Segments
An operating segment is a component of the Company that engages in business
activities from which it may earn revenues and incur expenses, including
revenues and expenses that relate to transactions with any of the Company's
other components. The Company is engaged in a single segment of business,
being investment in Vietnam. The Board, as a whole, has been determined as
constituting the chief operating decision maker of the Company. The key
measure of performance used by the Board to assess the Company's performance
and to allocate resources is the total return on the Company's NAV calculated
as per the prospectus.
Information on gains and losses derived from investments are disclosed in the
Statement of Comprehensive Income.
The Company is domiciled in Guernsey, Channel Islands. Entity wide disclosures
are provided as the Company is engaged in a single segment of business,
investing in Vietnam. In presenting information on the basis of geographical
segments, segment investments and the corresponding segment net investment
income arising thereon are determined based on the country of domicile of the
respective investment entities.
In line with the Company's investment policy, the Company may invest:
● up to 25% of its NAV (at the time of investment) in companies with
shares traded outside of Vietnam if a majority of their assets and/or
operations are based in Vietnam;
● up to 20% of its NAV (at the time of investment) in direct private
equity investments; and
● up to 20% of its NAV (at the time of investment) in other listed
investment funds and holding companies which have the majority of their assets
in Vietnam.
As of 30 June 2025, no individual investment exceeded 20% of the net assets
attributable to Shareholders (2024: none).
All of the Company's investments in securities at fair value are in Vietnam as
at 30 June 2025 and 30 June 2024. All of the Company's investment income can
be attributed to Vietnam for the years ended 30 June 2025 and 30 June 2024.
5 Share Capital
Ordinary shares of USD 1 each
Pursuant to its redomiciliation to Guernsey, the Company re-registered with an
authorised share capital of USD 200,000,000 divided into 200,000,000 shares of
a nominal or par value of USD 1.00 each. In accordance with the Company's
Articles of Incorporation Amended and restated by special resolution on 21
December 2023, the Company may, from time to time, redeem all or any portion
of the shares held by the Shareholders on annual basis upon giving notice of
not less than 30 calendar days.
Holders of ordinary shares are entitled to attend, speak and vote at general
meetings of the Company. Each ordinary share (excluding shares in treasury)
earns one vote.
On 8 March 2019 the Company's ordinary shares were cancelled from trading on
AIM and admitted to the Main Market (previously Premium segment of the
Official List) and trading on the Main Market of the London Stock Exchange
("Main Market"). On the same date the Company's shares were admitted to
listing and trading on the TISE.
2025 2024
No. of shares No. of shares
Total shares issued and fully paid (after repurchases and cancellations) at 27,284,892 27,725,104
beginning of the year
Shares issued during the year 113,500 -
Shares cancellation during the year (246,505) (440,212)
Shares held in treasury during the year (235,104) -
Shares redemption during the year (3,411,748) -
23,505,035 27,284,892
Repurchased and reserved for own shares
At beginning of the year - -
During the year (3,893,357) (440,212)
Shares held in treasury 235,104 -
Share cancellation 3,658,253 440,212
Total outstanding ordinary shares with voting rights 23,505,035 27,284,892
The Company operates two distinct share repurchase policies. Under the annual
redemption facility, qualifying shareholders may redeem their shares at NAV,
with redeemed shares subsequently cancelled. Separately, the Company also
conducts market buybacks under its Share Buyback Policy. Prior to 21 February
2025, repurchased shares were cancelled however following the policy revision,
shares may be held in treasury without voting or dividend rights.
As part of the introduction of the first annual redemption facility, the final
number of ordinary shares validly tendered for redemption for the year ended
30 June 2025 was 3,411,748 shares.
As at 30 June 2025, 235,104 shares were held in treasury and 246,505 shares
repurchased earlier in the year were cancelled.
During the financial year ended 30 June 2025, the Company issued a total of
113,500 ordinary shares. These shares were offered for cash consideration and
allotted in various tranches throughout the year.
Reserve for own shares
Reserve for own shares are the Company's own shares which had been
repurchased. The amount represents share capital which can be reissued in the
future or subsequently cancelled. All reserves are available for distribution
subject to a solvency assessment.
During the year ended 30 June 2025 the Company repurchased and cancelled
246,505 ordinary shares (2024: 440,212 ordinary shares) under the Company's
share buyback programme (representing 0.9% of the ordinary shares outstanding
at 1 July 2025).
On 30 September 2024, the Company redeemed and cancelled 3,411,748 Ordinary
Shares (2024: Nil), representing approximately 12.57% of the shares in issue
as of 31 August 2024.
On 21 February 2025, the Company revised its Share Buyback Policy, authorising
that repurchased shares be held in treasury and not cancelled. Following this
amendment, the Company repurchased 235,104 ordinary shares under its approved
buyback programme (2024: Nil). These shares are held in treasury and do not
carry voting or dividend rights. As at 30 June 2025, the number of ordinary
shares in issue has been reduced by 235,104 shares due to the buyback (2024:
Nil).
As a result, as at 30 June 2025, the Company has 23,505,035 (2024: 27,284,892)
ordinary shares with voting rights in issue (excluding the reserve for own
shares), and 235,104 (2024: Nil) are held as reserves for treasury shares.
Capital Management
The Company does not have any externally imposed capital requirements.
The Company's general intention is to reinvest the capital received on the
sale of investments. However, the Board may from time to time and at its
discretion, either use the proceeds of sales of investments to meet the
Company's expenses or distribute them to Shareholders. Alternatively, the
Company may repurchase its own ordinary shares with such proceeds from
Shareholders pro rata to their shareholding upon giving notice of not less
than 30 calendar days to Shareholders (subject always to applicable law) or
repurchase ordinary shares at a price not exceeding the last published NAV per
share.
6 Net Assets Attributable to Shareholders
Total equity of USD 117,622,802 (2024: USD 140,151,385) represents net assets
attributable to Shareholders. NAV per share as at 30 June 2025 is USD 5.004
(2024: USD 5.137).
7 Net (Loss)/Gain from Investments at Fair Value through Profit or Loss
2025 2024
USD USD
Realised gain on disposal of investments 17,034,541 18,459,534
Realised foreign currency loss (2,341,800) (2,011,711)
Unrealised (loss)/gain on investments at fair value through profit or loss (15,848,509) 15,781,434
Unrealised foreign currency gain/(loss) 591,481 (4,193,284)
(564,287) 28,035,973
8 Related Party Transactions
Investment management fees
The Company entered into a new investment management agreement with Dynam
Capital, Ltd on 26 June 2018. The agreement was amended and restated on 8
October 2018 and further amended and restated on 1 October 2020. The Board and
the Investment Manager agreed to modify the management fee (previously on a
sliding scale of 1.5% per annum on NAV below USD 300 million, 1.25% per annum
on NAV between USD 300 - USD 600 million, and 1.0% per annum on NAV above USD
600 million) effectively from 1 November 2020.
Pursuant to the agreement the Investment Manager is entitled to receive a
monthly management fee, paid in the manner set out as below:
● On the amount of the Net Asset Value of the Company up to but
excluding USD 300 million, one-twelfth of 1.75%;
● On the amount of the Net Asset Value of the Company between and
including USD 300 million up to and including USD 600 million, one-twelfth of
1.5%; and
● On the amount of the Net Asset Value of the Company that exceeds
USD 600 million, one-twelfth of 1%.
The management fee accruing to the Investment Manager for the year ended 30
June 2025 was USD 2,189,005 (2024: USD 2,237,255). An amount of USD 164,372
(2024: USD 203,206) was outstanding as at 30 June 2025.
Directors' fees and expenses
The Board determines the fees payable to each Director, subject to a maximum
aggregate amount of USD 350,000 (2024: USD 350,000) per annum being paid to
the Board as a whole. The Company also pays reasonable expenses incurred by
the Directors in the conduct of the Company's business including travel and
other expenses. The Company pays for directors and officers liability
insurance coverage.
The charges for the year for the Directors' fees were USD 253,250 (2024: USD
257,622) and expenses were USD 76,042 (2024: USD 105,215). The total
Directors' fees and expenses for the year were USD 329,292 (2024: USD
362,837).
As at 30 June 2025, USD nil (2024: nil) of Directors' fees were outstanding.
Ownership of shares
As at 30 June 2025, Directors held 34,964 ordinary shares in the Company
(2024: 34,964) as listed below.
Hiroshi Funaki 19,887
Philip Scales 10,077
Saiko Tajima 5,000
Mr Funaki is also a Director of Discover Investment Company which at 30 June
2025 held 1,415,776 ordinary shares in the Company representing 6.03% of the
issued share capital.
9 Custodian Fees
Custodian fees are charged at a minimum of USD 12,000 (2024: USD 12,000) per
annum and received as a fee at 0.08% on the assets under administration
("AUA") per annum. Custodian fees comprise safekeeping fees, transaction fees,
money transfer fees and other fees. Safekeeping of unlisted securities up to
20 securities is charged at USD 12,000 (2024: USD 12,000) per annum.
Transaction fees, money transfers fees and other fees are charged on a
transaction basis.
The charges for the year for the Custodian fees were USD 119,014 (2024: USD
127,617), of which USD 10,500 (2024: USD 11,780) were outstanding at year end.
10 Administrative and Accounting Fees
In accordance with the new Administration Agreement between the Company and
Apex Fund and Corporate Services (Guernsey) Limited (the "Administrator")
dated 7 October 2019, the Administrator is entitled to receive a fee of 0.08%
per annum of NAV up to USD 100,000,000, 0.07% of NAV thereafter subject to a
minimum fee of USD 140,000 per annum. The administration fees are accrued
monthly and are payable quarterly in advance. The charges for the year for
Administration fees were USD 158,306 (2024: USD 150,580), of which USD 500
(2024: USD 500) were outstanding at year end.
The Sub-Administrator receives a fee as consideration for the services
provided to the Company at such rates as may be agreed in writing from time to
time between the Company and the Sub-Administrator. The charges for the year
for Administration fees were USD 63,152 (2024: USD 63,638), of which USD 5,002
(2024: USD 5,384) were outstanding at year end.
Total administrative and accounting fees for the year were USD 221,457 (2024:
USD 214,218).
11 Other Operating expenses
2025 2024
USD USD
Technical assistance for investee companies 37,416 30,943
Brokerage fees 284,151 381,590
General expenses 152,181 136,640
Insurance cost 8,037 8,037
Publicity and investor relations fees 341,530 597,150
823,315 1,154,360
12 Controlling Party
The Directors are not aware of any ultimate controlling party as at 30 June
2025 or 30 June 2024.
13 Fair Value Information
For certain of the Company's financial instruments not carried at fair value,
such as cash and cash equivalents, accrued dividends, other receivables,
receivables/payable upon sales/purchase of investments and accrued expenses,
the amounts approximate fair value due to the immediate or short-term nature
of these financial instruments.
Other financial instruments are measured at fair value through profit or loss.
Fair value estimates are made at a specific point in time, based on market
conditions and information about the financial instrument. These estimates are
subjective in nature and involve uncertainties and matters of significant
judgement and therefore, cannot be determined with precision. Changes in
assumptions could significantly affect the estimates.
● Level 1: Inputs that are quoted market prices (unadjusted) in
active markets for identical instruments. This level includes listed equity
securities on exchanges (for example, Ho Chi Minh Stock Exchange).
● Level 2: Inputs other than quoted prices included within Level 1 that
are observable either directly (i.e., as prices) or indirectly (i.e., derived
from prices). This level includes instruments valued using: quoted prices for
identical or similar instruments in markets that are considered less than
active; quoted market prices in active markets for similar instruments; or
other valuation techniques in which all significant inputs are directly or
indirectly observable from market data.
● Level 3: Inputs that are not based on observable market data (i.e.,
unobservable inputs). This level includes all instruments for which the
valuation technique includes inputs not based on observable data and the
unobservable inputs have a significant effect on the instrument's valuation.
The table below analyses financial instruments measured at fair value at the
reporting date by the level in the fair value hierarchy into which the fair
value measurement is categorised. The amounts are based on the values
recognised in the Statement of Financial Position. All fair value measurements
below are recurring.
Level 1 Level 2 Level 3 Total
USD USD USD USD
2025
Financial assets classified at fair value upon initial recognition
Investments in securities 113,668,414 - - 113,668,414
2024
Financial assets classified at fair value upon initial recognition
Investments in securities 134,971,131 - - 134,971,131
There were no transfers between levels during the year.
The level in the fair value hierarchy within which the fair value measurement
is categorised in its entirety is determined based on the lowest level input
that is significant to the fair value measurement in its entirety. Assessing
whether an input is significant requires judgement including consideration of
factors specific to the asset or liability. Moreover, if a fair value
measurement uses observable inputs that require significant adjustment based
on unobservable inputs, that fair value measurement is a Level 3 measurement.
There are no level 3 assets held at 30 June 2025 (2024: nil).
14 Classifications of Financial Assets and Liabilities
The table below provides a breakdown of the line items in the Company's
Statement of Financial Position to the categories of financial instruments.
Fair value through Profit or loss Financial assets at amortised cost Financial liabilities at amortised cost Total carrying Amount
USD USD USD USD
2025
Cash and cash equivalents - 4,524,725 - 4,524,725
Investment in securities at fair value 113,668,414 - - 113,668,414
Accrued dividends and interest - 71,944 - 71,944
Receivables on sale of investments - 175,246 - 175,246
113,668,414 4,771,915 - 118,440,329
Payables on purchase of investments - - 596,605 596,605
Accrued expenses - - 220,922 220,922
- - 817,527 817,527
2024
Cash and cash equivalents - 2,894,425 - 2,894,425
Investment in securities at fair value 134,971,131 - - 134,971,131
Accrued dividends and interest - 73,797 - 73,797
Receivables on sale of investments - 2,451,845 - 2,451,845
134,971,131 5,420,067 - 140,391,198
Accrued expenses - - 239,813 239,813
- - 239,813 239,813
15 Earnings Per Share
The calculation of basic and diluted earnings per share at 30 June 2025 was
based on the total comprehensive loss for the year attributable to
Shareholders loss of USD 2,850,696 (2024: USD 26,522,608) and the weighted
average number of shares outstanding of 24,799,146 (2024: 27,383,130).
16 New and Amended Standards and Interpretations
(i) Standards and amendments to existing standards effective 1 July 2024
The Board of Directors has assessed the impact, or potential impact, of all
new standards and amendments to existing standards. In the opinion of the
Board of Directors, there are no mandatory new standards and amendments
applicable in the current year that had any material effect on the reported
performance, financial position, or disclosures of the Company.
(ii) Standards effective after 30 June 2025 that have not been early adopted
by the Company
IFRS 18 - Presentation and Disclosure in Financial Statements
The Company has reviewed the implications of IFRS 18, issued by the IASB,
which will replace IAS 1 Presentation of Financial Statements. IFRS 18
introduces comprehensive requirements for the classification and presentation
of income and expenses in the income statement, as well as enhanced disclosure
obligations for performance measures defined by management. The standard is
effective for annual reporting periods beginning on or after 1 January 2027,
subject to endorsement in the UK. Management anticipates that the adoption of
IFRS 18 will primarily affect the presentation format of the income statement
and require additional disclosures of management-defined performance measures
but does not expect a material impact on the recognition or measurement of
financial results.
Classification and Measurement of Financial Instruments - Amendments to IFRS 9
and IFRS 7
The Company has considered the Classification and Measurement of Financial
Instruments - Amendments to IFRS 9 and IFRS 7, specifically the clarifications
related to the settlement of financial assets and liabilities via electronic
payments. These amendments, which are effective for annual periods beginning
on or after 1 January 2026, clarify certain electronic cash settlement
arrangements may still meet the criteria for derecognition under IFRS 9.
Management has assessed that these amendments will not have a significant
impact on the Company's financial statements, as current settlement practices
already align with the clarified derecognition criteria.
17 Events After the Reporting Date
On 2 September 2025, the Company announced that the second annual redemption
facility had resulted in 4,198,773 Ordinary Shares being validly tendered for
redemption. These ordinary shares represent approximately 17.9% of the
ordinary shares in issue as at 31 August 2025. The Board resolved that the
redemption price will be based on the Company's official net asset value per
share as at 30 September 2025. The net asset value per share is expected to be
announced by mid-October 2025 and it is anticipated that payments will be made
to redeeming shareholders by the end of October 2025.
From 1 July 2025 to the date of signing these financial statements, there were
no other material events that require disclosures and/or adjustments in these
financial statements.
Alternative Performance Measures ("APMs")
Discount or Premium
The amount, expressed as a percentage, by which the ordinary share price is
either higher (premium) or lower (discount) than the NAV per ordinary share.
Page 30 June 2025
NAV per ordinary share (pence) 1 a 365.2
Ordinary share price (pence) 1 b 338.0
Discount 1 ((b-a)/a) 7.4%
Ongoing charges
Ongoing charges have been calculated in accordance with the Association of
Investment Companies (the "AIC") recommended methodology by taking the
regularly incurred annual operating expenses of running the Company expressed
as a percentage of average NAV.
The ongoing charges for the year ended 30 June 2025 were 3.04%.
30 June 2025
Page USD
Average NAV 1 a 125,427,717
Operating expenses 1 b 3,813,159
Ongoing charges 1 b/a 3.04%
a) Average NAV
Calculated using twelve monthly closing average NAV for the year ended 30 June
2025.
b) Operating expenses
Total annual expenses incurred by the Company less the cost of project and
one-off expenses i.e. non-recurring expenses.
Page USD
Total annual expenses 52 a 3,871,552
Less: non-recurring expenses 1 b (58,393)
Operating expenses 1 b=c+d 3,813,159
Corporate Information
Directors UK Legal Adviser
Mr. Hiroshi Funaki Stephenson Harwood LLP
Mr. Philip Scales 1 Finsbury Circus
Ms. Saiko Tajima London
Ms. Connie Hoang Mi Vu EC2M 7SH
Investment Manager Guernsey Legal Adviser
Dynam Capital, Ltd Carey Olsen (Guernsey) LLP
1 Royal Plaza Carey House
Royal Avenue Les Banques
St Peter Port St Peter Port
Guernsey Guernsey
GY1 2HL GY1 4BZ
Registered Office, Company Secretary and Administrator Market Researcher
Apex Fund and Corporate Services (Guernsey) Limited Dynam Consultancy and Services Company Limited
1 Royal Plaza Floor 12, Deutsches Haus,
Royal Avenue 33 Le Duan,
St Peter Port Ben Nghe Ward, District 1
Guernsey Ho Chi Minh City,
GY1 2HL Vietnam
Sub-Administrator, Custodian and Principal Bankers Corporate Broker and Financial Adviser
Standard Chartered Bank (Singapore) Limited Cavendish Securities plc
7 Changi Business Park Crescent One Bartholomew Close
Level 3, Securities Services London
Singapore 486028 EC1A 7BL
Auditor Registrar
KPMG Channel Islands Limited Computershare Investor Services (Guernsey) Limited
Glategny Court 1st Floor, Tudor House
Glategny Esplanade Le Bordage
St Peter Port St Peter Port
Guernsey Guernsey
GY1 1WR GY1 1DB
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