Monthly Investor Report

RNS Number : 6569P
VietNam Holding Limited
11 June 2020
 

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

Monthly Investor Report

A report detailing the activities of the Company for the month May 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.

The Darling Buds of May

Vietnam continued to 'make the news' throughout the month of May. It was Asia's best performing stock market and stood out from the rest of the world with its swift containment of covid-19 and smooth start to the re-opening of its economy. Vietnam has reported around 320 cases from a population of over 97m, and remarkably, as of the end of May, has not reported any covid-19 related deaths. As a result, the Asian Development Bank forecast Vietnam's economic growth to be among the fastest in the region this year, with the International Monetary Fund reissuing a predicted growth rate of 2.7 percent. The World Bank also applauded Vietnam's resilience, reiterating how the nation benefits from numerous free trade agreements and favourable labour market conditions.

The VNH portfolio performed strongly, up 10.4 percent from April, while domestic investors fuelled a 13 percent rally in the Vietnam All Share Index led mainly by banks and real estate companies. Most companies in our portfolio implemented effective business continuity plans before and during the lockdown, and we have been impressed by management teams' top priority being with the health and safety of their employees and customers. To date, no covid-19 cases have been recorded at any of these companies. Our environmental, social and governance (ESG) criteria have shone through the portfolio throughout this pandemic. FPT Corp, our largest holding, was outstanding in communicating its preventative measures and contingency plans to stakeholders and shareholders, not least to its staff and supply chain. It organised its AGM in April online, rather than cancelling, and kindly dedicated its 2,000-room university dormitory as a quarantine site after donating US$850k in medical supplies to support the government's fight against covid-19. It also launched a free website app providing real-time information about the virus. Hoa Phat Group, one of our fastest growing companies, continued to invest heavily in energy efficient technology, and its long-term partnerships with importers imposing the strictest requirements on quality and the highest of industry standards led to a steel pipe exportation year-on-year increase of 78% over the first five months of 2020.

Vietnam's ability to limit the impact of the pandemic is also reflected in how it acts as a society. For example, the state did not shy away from broadcasting the seriousness of the virus, and even made a pop music video to communicate the importance of handwashing that immediately went viral. In March, the government launched a fundraising campaign to buy medical and protective equipment for people working closely with covid-19 patients. By the 5th of April, more than 2.1m donations had been sent via text message platform. At the same time, E-commerce continued to grow, with online shopping increasing by 33 percent in April and May, as well as online payments and use of e-wallets jumping 10 percent. Phu Nhuan Jewellery, a top contributor in the portfolio, implemented a sophisticated contingency plan as early as February, pushing online sales from the onset to help cushion store closures during lockdown. Domestic travel served as another bolster for Vietnam's economy in May having opened during the holiday weekend of the 30th of April to areas such as Da Lat, Vung Tau and Mui Ne. Hotel occupancies increased, with restaurants and coffee shops opening under stringent social distancing guidelines. Savills Vietnam predicts tourism to fully recover once international flights resume, particularly with travellers from South Korea and China, as the country's successful handling of the covid-19 crisis has given it a 'safe status' for visitors too.

 

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

Nominated Adviser and Corporate Broker       Tel: +44 20 7220 0500 

William Marle / Giles Rolls


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