VietNam Holding Limited Monthly Investor Report (8486L)
15 January 2021 - 9:20PM
UK Regulatory
TIDMVNH
RNS Number : 8486L
VietNam Holding Limited
15 January 2021
VietNam Holding Limited ("VNH" or the "Company")
Monthly Investor Report
A report detailing the activities of the Company for the month
of December 2020 has been issued by Dynam Capital Limited, the
investment manager of the Company. Electronic copies of the report
have been made available to shareholders on the Company's website
and a summary of the report is included below.
Shiny Happy People
As we step into 2021, it is hard to believe how the world has
changed since this time last year. No one could have imagined the
velocity and vastness of the pandemic, or the spectrum of varied
economic stories and sentiment not only across the globe but also
the region. Vietnam ended 2020 on relatively high notes, in this
respect, with its manufacturing PMI rebounding to 51.7 in December
and a record trade surplus reaching close to $20bn.
Vietnam is poised to be one of the few economies in the world to
register positive growth for 2020 having achieved a YoY growth of
+2.9%. Asia's recovery appears to be faster than after the global
financial crisis of 2008-2009, and Vietnam stands out given the
relatively quick resumption of domestic activity.
Domestic confidence is especially robust compared with other
countries. In an end of year survey conducted by Indochina Research
between October 31(st) and November 12(th) , 98% of Vietnamese
people compliment the government's handling of the pandemic, 63% of
them feel happy with their lives, 89% feel healthy, and 67% are
optimistic about 2021. Such optimism has been reflected in the
increased activity of retail investors in Vietnam's equity markets:
daily liquidity (and the margin lending that accompanies it) has
reached record levels. Although this has been putting some strain
on the stock exchange infrastructure, a system upgrade expected
this year will benefit all investors.
December proved to be another strong month for the Fund, with
NAV up +8.2%, taking the gains over the last six months to +38
percent. 23 out of 25 stocks in the VNH portfolio performed
positively in December, led by VP Bank (+21.5%), Gemadept (+17.4%)
and Hoa Phat Group (+16.9%). Laggards included Vinh Hoan (-6.2%),
which is a leading exporter of aquaculture products but faces a
rising risk of higher tariffs in the US market due to the USTR's
investigation into alleged currency manipulation by Vietnam.
Viettel Post was also down 1.1%, despite increasing 32% during the
year. Its delivery services have been on the right track all year,
particularly given the booming e-commerce sector, but fears of
increasing competition from foreign players took the shine off the
stock during the month.
Retail sales recovered significantly by +9.4% YoY in December
2020 and the outlook for the manufacturing sector remains solid.
This is not so surprising considering that FDI disbursement in 2020
was down by only 2% YoY, and we expect an even smoother flow of FDI
into Vietnam this year. Public investment disbursement reached
$20.2bn in 2020, a YoY increase of +34%.
Whilst consumer confidence has recovered significantly since
May, it is still not where it was this time last year.
Nevertheless, Parliament has been focusing on incentives to further
spur local consumption, for example, given the impact that
international travel restrictions have had on Vietnam's large
tourism sector over the past year. Although restrictions on
international air travel are expected to carry on for some time
from countries where the new variant is present, as the Vietnamese
continue their cautious stance on the risk of imported cases of
Covid-19, domestic travel has been growing since May. Airports and
restaurants in famous beach get-away spots, such as Phu Quoc, have
been particularly busy and bustling of late, albeit with social
distancing rules in place.
Vietnam remains a bright spot of optimism as clouds persist
across many other countries. If it can isolate itself from further
outbreaks of Covid-variants and work steadily to derive a
vaccination plan for its c100m people, then 2021 could be the year
in which Vietnam steps up and steps out into the sunshine. Whilst
short-term risks remain, the strength of forecast corporate
earnings growth supports the market optimism.
For more information please contact:
Dynam Capital Limited
Craig Martin Tel: +84 28 3827 7590
info@dynamcapital.com | www.dynamcapital.com
www.vietnamholding.com
finnCap
Corporate Broker and Financial Advisor Tel: +44 20 7220 0500
William Marle / Giles Rolls
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