TIDMVEIL
RNS Number : 0552Q
Vietnam Enterprise Investments Ltd
13 October 2023
13 October 2023
Vietnam Enterprise Investments Limited
("VEIL" or "the Company")
Monthly Update
VEIL is a London-listed investment company investing primarily
in listed equities in Vietnam and a FTSE 250 constituent. The
Company's NAV performance for September 2023 is set out in this
notice.
Company Performance
-- As of 30 September, VEIL's NAV decreased 5.5% over the
previous month against a fall of 6.6% for its reference index, the
Vietnam Index ("VNI"), both in total return USD terms. The
Company's NAV per share was US$8.85 and its total NAV was
US$1.8bn.
-- VEIL's share price decreased 5.6% in September and has risen
3.2% year-to-date, both in USD terms.
-- VEIL's three-month NAV per share performance in USD terms is
+2.2%, +0.7% over one year and +31.9% over three years. Over the
same time periods, the performance of the VNI was +0.4%, +1.7% and
+27.1%, respectively.
-- In GBP terms, VEIL's NAV decreased 1.8% over the previous
month and has risen 11.0% year-to-date. The Company's NAV per share
was GBP7.25 as of 30 September and its total NAV was GBP1.5bn. The
GBP share price decreased by 2.0% for the month and has increased
1.7% year-to-date.
-- The share price discount to NAV as of 30 September was 18.2%,
compared with 18.1% at the end of August and 10.7% as of 31
December 2022.
-- The Company repurchased 1,158,987 shares in September,
compared with 391,143 shares repurchased in August. Year-to-date to
30 September, 3,586,058 (1.7% of shares outstanding as of 1 January
2023) have been repurchased.
-- The Vietnamese dong ("VND") depreciated 0.9% against the USD
in September and has depreciated 2.8% year-to-date. The VND
appreciated 3.0% against the GBP in September and has depreciated
4.1% year-to-date.
Dien Vu, Portfolio Manager of VEIL commented:
"Vietnam's Q3 2023 GDP growth registered at 5.3% year-on-year to
make an overall increase of 4.2% in the first nine months of 2023
(following growth of 3.3% in Q1 and 4.1% in Q2). The Manager is
currently expecting full year 2023 GDP growth of 5%, accelerating
to 6.0-6.5% in 2024. Vietnam recorded a trade surplus of US$21.7bn
in the first nine months of 2023 (a significant increase compared
with US$6.8bn at the same stage of 2022), with exports and imports
totalling US$259.7bn and US$238.0bn, down 8.2% and 13.8%,
respectively.
"The State Bank of Vietnam has lowered rates on four occasions
this year to help boost domestic consumption, thus countering a
slowdown in global demand, but the VND remains relatively stable
due to disbursed FDI of US$15.9bn so far this year and the
aforementioned trade surplus. Average CPI in the first nine months
of 2023 was 3.2%, below the Government's 4.5% target.
"The market witnessed early positive momentum in September,
peaking at a near one-year high of 1,245.5 points in the first and
second weeks of the month. The market then succumbed to profit
taking triggered by a blend of domestic and international
pressures. Following US inflation data reporting a rise in
inflation from 3.2% in July to 3.7% in August, the Federal Reserve
hinted there could be more increases to come to combat inflation.
As a result, bond yields surged to break 15-year resistance levels
as the market digested the 'higher for longer' narrative. As the US
dollar index strengthened, Vietnam's equity markets saw net foreign
selling of US$165.8mn. A similar situation was also apparent in
other countries in the region, with Thailand, Indonesia and the
Philippines recording outflows of US$616mn, US$263mn and US$464mn,
respectively.
"With the exception of energy, all sectors in the listed market
declined in value during September, we believe because local
investors feared that the easing of domestic monetary conditions
could not be sustained and chose to reduce risk. Market sentiment
was further dampened by the State Bank of Vietnam issuing US$5.7bn
of bills, and major brokers scaled back on margin lending. Trading
volumes trailed off at the end of the month yet average daily
turnover in September still averaged US$1.1bn, the sixth
consecutive monthly rise.
"Property stocks had another difficult month, this was
attributed to a major developer (not in the VEIL portfolio)
continuing to struggle with bond restructuring, and because of
lowered expectations of how soon further interest rate cuts might
happen. Both mid and large-cap property stocks were impacted,
including VEIL top-ten holdings Vinhomes ("VHM") and Khang Dien
House ("KDH") despite their solid track records through market
cycles. Both possess strong balance sheets and have low debt to
equity ratios of 0.3-0.4x as well as large land banks and strong
ready-to-launch pipelines."
Top Ten Holdings (61.6% of NAV)
Company Sector NAV % VNI % Monthly One-year
Return % Return %
Vietnam Prosperity
1 Bank Banks 11.1 3.2 2.5 18.2
================== =================== ===== ===== ========= =========
2 Hoa Phat Group Materials/Resources 8.7 3.4 -5.7 21.6
================== =================== ===== ===== ========= =========
3 Vietcombank Banks 7.6 10.9 -2.8 38.4
================== =================== ===== ===== ========= =========
Asia Commercial
4 Bank Banks 7.4 1.9 -4.3 15.5
================== =================== ===== ===== ========= =========
5 Mobile World Group Retail 6.2 1.7 -3.2 -18.7
================== =================== ===== ===== ========= =========
6 FPT Corporation Software/Services 5.7 2.6 -5.0 33.0
================== =================== ===== ===== ========= =========
7 PetroVietnam Gas Energy 4.4 3.9 9.3 0.5
================== =================== ===== ===== ========= =========
8 Vinhomes Real Estate 3.9 4.4 -17.7 -12.0
================== =================== ===== ===== ========= =========
9 Vinamilk Food & Beverage 3.5 3.4 -5.6 5.9
================== =================== ===== ===== ========= =========
10 Khang Dien House Real Estate 3.1 0.5 -12.7 14.1
================== =================== ===== ===== ========= =========
Vietnam Index - - -6.6 1.7
================== =================== ===== ===== ========= =========
Source: Bloomberg, Dragon Capital
NB: All returns are given in USD terms
For further information, please contact:
Vietnam Enterprise Investments Limited
Rachel Hill
Phone: +44 122 561 8150
Mobile: +44 797 121 4852
rachelhill@dragoncapital.com
Jefferies International Limited
Stuart Klein
Phone: +44 207 029 8703
stuart.klein@jefferies.com
Buchanan
Charles Ryland / Henry Wilson / George Beale
Phone: +44 20 7466 5111
veil@buchanan.uk.com
Radnor Capital Partners
Iain Daly
Phone: +44 20 3897 1830
id@radnorcp.com
LEI: 213800SYT3T4AGEVW864
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