VietNam Holding Limited ("VNH" or the
"Company")
Monthly Investor Report
A report detailing the activities of
the Company for the month of September 2024 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.
Manager Commentary: Banking on
recovery
Despite devastation caused by
Typhoon Yagi in early September, particularly around the Red River
Delta, which mostly affected the agricultural sector, Vietnam
managed to stay strong on the ever so uncertain global stage. For
the first time since becoming Vietnam's president in May, To Lam
toured the world throughout the month with significant visits to
China, the US, Cuba and France. Lam continued to advocate Vietnam's
'bamboo diplomacy' approach to foreign policy, widely regarded as a
delicate balancing act of relations between powers like the US and
China in terms of maintaining autonomy and national interests. His
trip to the US coincided with the United Nations General Assembly,
where he met with President Biden to reaffirm the US-Vietnam
Comprehensive Strategic Partnership. While the visit to China was
significant in stabilising and enhancing Vietnam-China ties, given
the neighbouring countries' long history and recent tensions in the
South China Sea, it was even more telling that a Chinese delegation
came to Vietnam within the same month to confirm their commitment
to increasing economic ties. Lam, who was previously the minister
of public security, was praised both at home and abroad for his
pragmatic style of attracting further foreign investment,
especially in the manufacturing and technology sectors.
There is no doubt this helped keep
Vietnam's projected GDP growth for 2024 in the range of 6% and 7%,
which stands out globally. The IMF currently forecasts 6.1% growth,
it says is driven by strong external demand, resilient foreign
direct investment (FDI), and supportive fiscal and monetary
policies. HSBC recently raised its forecast to 7%, highlighting
Vietnam's robust Q3 performance in 2024, especially in
manufacturing and exports, which have shown significant recovery,
particularly in sectors like electronics, textiles, and
footwear.
The equity market reflected this
nicely in September as it started to price in the brighter
macroeconomic outlook. A weaker US dollar and the Federal Reserve
rate cuts certainly supported the sentiment of the local market
too.
As for the Fund, it was up 21.3%,
versus the VNAS benchmark's 15%, for the first nine months of 2024.
This performance was largely due to our largest holding, which is
in FPT, one of Vietnam's leading technology companies. Its stock
surged by around 60% during this period and exemplifies the
opportunities in Vietnam's developing growing digital economy. But
we must also note our overweight in Financial Services,
particularly in Sacombank (STB) and Techcombank (TCB), with
respective proportions of 4.1% and 6.4%. Both stocks saw large
buy-ins, given their long-term growth with strong retail operations
and focus on digital transformation, even as some banks experienced
selloffs. STB reported a 12% increase in profits during the first
half of 2024 (1H2024) compared to the same period last year. TCB
also showcased robust performance, with a reported pre-tax profit
target for 2024 that reflects an 18.4% growth year-on-year. The
Fund maintains selective over weights in Banks and Retails with the
expectation that they will continue to ride the stride in the
second half of 2024. We also expect strong EPS growth in 2H2024 and
maintain the forecast of about 20% EPS growth for 2025.
Our recent first share redemption,
where ~12.6% sought to redeem (out of possible 100%) showed strong
support for the fund (hence the higher than normal cash balance at
month-end). The fund's discount to NAV remains the narrowest by far
of the three UK listed Vietnam funds. Our AGM and Webinar is
scheduled for 7th November. Register to attend the webinar
here.
The Fund has also been nominated for
two awards - CityWire and QuotedData - the results of both will be
known in November.
For more information please
contact:
Dynam Capital
Limited
Craig
Martin
Tel: +84 28 3827 7590
info@dynamcapital.com
|www.dynamcapital.com
www.vietnamholding.com
Cavendish Capital Markets
Limited
Corporate Broker and Financial
Advisor
Tel: +44 20 7220
0500