Monthly Investor Report

RNS Number : 7447R

VietNam Holding Limited

10 March 2016

 

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

Monthly Investor Report

A report detailing the activities of the Company for the month of February 2016 has been issued by VietNam Holding Asset Management Limited, the investment manager of the Company. Electronic copies of the report have been made available to shareholders on the Company's website at http://www.vietnamholding.com/publications/investor-reports and a summary of the report is included below.

Investor Report Summary

Vietnam News

Despite the fundamental outlook for the Renminbi looking somewhat weak, so far this year such worries have not yet come to pass, with the RMB flat to a smidgeon up against the US Dollar year-to-date. The Vietnamese Dong too stayed firm, up 0.8% on the same basis. We continue to hold two main views on the Dong:

1) if, as seems justified, the RMB weakens, it would be sensible to expect a competitive devaluation of the Dong too;

2) Vietnam's balance of payments and overall economic situation is very different to China's. In isolation this suggests a relatively firm currency outlook for the Dong.

Data points for the first two months of 2016 underpin the latter assertion above: a Vietnamese trade surplus of USD 865m; disbursed foreign direct investment up 15% YoY at USD 1.5bn, continuing strong retail sales growth of 9.7% nominal, 8.3% real; and industrial production growth of 6.6%.

VNH Insights

The first two months of 2016 have been mostly very bad for equities worldwide. Year to date benchmark indexes have swooned in Japan (Topix, -16%), China (Shanghai Composite, -24%), the Eurozone (Euro Stoxx 50, -11%), and the US (S&P500, -5%). In this context, Vietnam's VNAS 2.7% YTD decline is something of a success, with February alone seeing a rise of 2.4% to 564.

VNH's NAV per share rose 3.6% in February to USD 2.249 and now stands at 0.8% up since the beginning of the calendar year. Vietnamese stocks are near to three-year valuation lows, at 11.2x trailing earnings and 1.4x book value; this is at parity with the MSCI emerging market index's price/earnings ratio, and a near 40% discount to the MSCI world's price/earnings ratio.    

Foreign ownership limits on listed equities in Vietnam are beginning to be raised on a case by case basis, for a dozen stocks so far. Vinamilk, most prominently, is moving in this direction, plus a collection of smaller names. This gives us some evidence that real change is afoot even if the implementation is piecemeal and gradual.

For more information please contact:

VietNam Holding Asset Management Limited	Tel: [phone]
Investor Relations Gyentsen Zatul [e-mail] www.vietnamholding.com
Smith & Williamson Corporate Finance Limited Nominated Adviser	Tel: [phone]
Azhic Basirov / Ben Jeynes
Winterflood Investment Trusts Broker	Tel: [phone]
Joe Winkley / Neil Langford
Buchanan Communications Financial Public Relations	Tel: [phone]
Charles Ryland / Vicky Watkins

 

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