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Vietnam Enterprise (VEIL)


Friday 11 March, 2022

Vietnam Enterprise

Monthly Update

RNS Number : 4762E
Vietnam Enterprise Investments Ltd
11 March 2022

11 March 2022


Vietnam Enterprise Investments Limited

("VEIL" or "the Company")


Monthly Update

1.0% NAV Return in February 2022



Vietnam Enterprise Investments Limited ("VEIL") is a closed-end fund investing primarily in listed equity in Vietnam, and a FTSE 250 constituent. The Company's NAV performance for February 2022 is set out in this notice.


Fund Performance

· As of 28 February, VEIL's NAV increased 1.0% over the previous month against a rise of 0.1% for its reference index, the Vietnam Index, both in US dollar terms.

· VEIL's NAV per share was US$12.35 at the 28 February, and its total NAV was US$2.6bn (£2.0bn)

· VEIL's share price decreased by -0.3% in February, and its discount to NAV as of 28 February was 19.5%, compared to 18.5% at the end of January 2022.

· Over the course of the month, VEIL bought back 1,005,715 shares to be held in treasury, compared with 671,835 shares repurchased in January 2022. Year to date (as of 28 February) 0.8% of shares outstanding have been repurchased.

· VEIL's top performing stock was Dat Xanh Group, a mid-cap property developer, up 24.1%



Economic Overview

· February exports grew 15.5% year-on-year to US$23.4bn, while imports rose 21.9% to US$25.4bn, making a trade deficit of US$2.0bn in February and year to date of US$0.6bn.

· This large trade deficit for the month was attributed to manufacturers increasing purchasing activity at the fastest pace in ten months in order to secure materials for production, according to IHS Markit's PMI survey.

· While registered FDI fell 8.5% year-on-year to US$5bn, disbursements rose 7.2% year-on-year to US$2.7bn.

· Samsung made the most notable FDI commitment of US$920m for a Samsung Electro - Mechanics factory

· At the beginning of March, nearly 77% of Vietnam's population of 97m were double-vaccinated and approximately 40% of the population have received a third dose.


Dien Huu Vu, the Portfolio Manager of VEIL commented:


"The Company outperformed a flat Vietnam Index in February, which unlike many markets globally has so far shown little reaction to events in Ukraine. From an economic perspective, whilst initial assessment from the Investment Manager suggests that the conflict has not had a material direct impact on Vietnam's economy, we believe there will be knock-on effects with markets globally having been affected and ongoing inflationary pressure.


The CPI in Vietnam was up +1.4% year-on-year in February, which is minimal compared to the US and Europe, but the question is where it goes from here. The Investment Manager has adjusted its 2022 inflation forecast from 3.5% to 4.2% to reflect oil at $120 per barrel. While oil itself is just 3.6% of the CPI basket, increased fuel costs could quickly spill over into other components of the basket, and non-fuel commodity prices are also vulnerable. Meanwhile, the Investment Manager has reduced its trade-surplus projection from US$13bn to US$10bn to make room for higher import prices (led by oil), and perhaps a decline in export volumes created by both demand and supply-chain factors. Currency risk seems limited given external account surpluses, rising US dollar reserves, low foreign debt and ongoing FDI disbursement.


Stocks advanced after the Tet (Lunar New Year) Holiday before losing some ground to global market turmoil, although recovered soon enough and resumed their consolidation around the Vietnam Index's record-highs of 1,500. In February, average daily turnover decreased by 15.6% to US$1.0bn on the Ho Chi Minh Stock Exchange, and by 16.1% to US$1.1bn on the combined exchanges, for the first two months of the year, average daily turnover was US$1.4bn, a 60% increase year-on-year. Money flows were supportive, with new retail investor account openings reaching their third-highest monthly number ever, at 211k, bringing new openings for the first two months of 2022 to 401k, more than all of 2020. Foreign net selling stabilised to US$16.4m following around US$130m of outflows in both January and December.



February Commentary



Mobile World Group ("MWG"), a leading retailer in Vietnam (market cap US$4.2bn at month-end) saw a small rise in share price as it advanced the development of its authorised Apple stores (under their own brand name) for which they are targeting 50% market share for all Apple products in Vietnam by the end of 2022. MWG currently has over 5,300 stores specialising in mobile phones, household appliances and groceries, and is now seeking further growth, piloting several new retail chains including sport, fashion and jewellery.


Hoa Phat Group ("HPG"), an integrated steel manufacturer (market cap US$9.3bn at month-end), recorded an 11.1% rise for the month with strong investor sentiment following solid sales volumes reported in February. The total sales volume was up 60% year-on-year to 813,000 tons for the month with improvement across all key products (rebar, hot rolled coil, pipe). The combined sales volume growth of the first two months of 2022 was up 34% year-on-year, signalling robust domestic demand. Additionally, steel prices have also started to recover well. Hot-rolled coil prices have stabilised and inched up, whilst HPG continuously raises the selling price for its rebar product to off-set the increased costs of coking coal, a key input ingredient.


Dat Xanh Group ("DXG"), a midcap real estate developer and leading property brokerage company (market cap US$1.1bn at month-end), rose 24.1% as investors welcomed the news that the legal process for one of the its key projects has been completed. DXG is now moving swiftly to restart the project, five years after its initial launch, although this time at approximately double the asking price per unit due to land price appreciation since 2017. The market also reacted well to news of DXG's latest land bank acquisition, a 152ha in Dong Nai province, which neighbours Ho Chi Minh City, marking the company's ambition to continue developing mega township projects of over 100ha in size.



Top Ten Holdings (72.7% of NAV)




Vietnam Index %


Monthly Change %


Hoa Phat Group






Vietnam Prosperity Bank






Mobile World






Asia Commercial Bank













Real Estate





Dat Xanh Group

Real Estate





FPT Corporation












Military Bank







For further information, please contact:


Vietnam Enterprise Investments Limited

Rachel Hill

Phone: +44 122 561 8150

Mobile: +44 797 121 4852

[email protected]  


Jefferies International Limited

Stuart Klein 

Phone: +44 207 029 8703

[email protected]  



Charles Ryland / Henry Wilson / George Beale

Phone: +44 20 7466 5111

[email protected]  


LEI: 213800SYT3T4AGEVW864

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