|VinaCapital Vietnam Opportunity Fund (VOF:LN) (5.1% of current portfolio):
Share Price: GBP 271p
Market Cap: GBP 560 Million (USD 705 Million)
Everything aligned for VOF in 2016 to deliver a blistering +70% return (in sterling terms): Its substantial capital markets (i.e. non/un-listed) portfolio allocation was a primary driver of a return that was nearly double that of the VN-Index, its NAV discount closed significantly, plus it enjoyed a dramatic boost from sterling’s post-Brexit depreciation (VOF shares are now listed in GBP). The portfolio out-performance is particularly gratifying, as I’d previously highlighted VOF’s more diversified portfolio as a better long-term bet (vs. its peer closed-end funds/ETFs, which focus on listed equities), in what’s still obviously a frontier market. [See blog comments here, for a comparison with the VanEck Vectors Vietnam ETF (VNM:US)…which, extraordinarily, managed to lose money for its shareholders last year!?]
The underlying VN-Index return is also a reminder there has been little sign of over-heating in the market, which leads me to believe there’s plenty more gas in the tank here. 2017 GDP growth’s expected to surpass the current 6.2% rate, retail sales are humming along at +10.2% yoy, inflation remains sub-5%, the USD/VND remains stable, the banks & the property market appear to be heading in the right direction again, and 10-15% EPS growth is expected…yet Vietnam continues to trade at a 20-30% P/E discount to regional averages. As for VOF itself, it trades on a 0.81 Price/Book multiple, despite an aggressive & ongoing share buyback programme – I see plenty of gains ahead in terms of NAV growth & discount compression, as Vietnam continues to leverage & benefit from its labour/cost export advantage, and (just as importantly) its burgeoning domestic consumer economy.
For this & other top picks, check/Google my latest 'Top Trumps For 2017...' post on the Wexboy investment blog.|
|Chunky share buy back there...|
|£3.40 a share NAV, seems to be moving in the right direction...|
|I'm in. Moved some of my NAIT profits...|
|I just bought in here. Only 1.25% of the wad.|
|just bought in here. Another rec from moneyweek and this below.
|Looks like quite a large discount to NAV still here. Reported value on 9th August was for 292p. Share price still around 220-230. Took an initial position here over past week as discount seems unjustified for such a fast growing economy.|
|Slowly, slowly getting noticed. Getting into the Small Cap Index at the start of this month will certainly help.|
|Moving to the main market seems to have served VOF well so far!|
|Thanks for clearing up my misunderstanding!I'll be buying in shortly.Went to Hanoi in 2008 and was impressed with what I saw, only taken me 8 years to get around to following up with an investment..!|
|lionheart - ??? - you haven't missed the discount and we don't get any different shares. All that has effectively happened is that the quote used to be in US$ @ 2.51; but is now in £GBP @ the equivalent price of 175p.
The fact that it is now listed on the Main Market will make it accessible to institutional investors; so expect that discount to close in, ergo share price to rise...|
|Are those already holding automatically getting new shares in the new listing? I had been meaning to buy in but didn't get round to it yet. I guess I'll have to wait till next week now, too bad I missed the discount.|
I have bought a few more this morning. It looks good to me , but they all do when I buy them.... Investment is always something of a stab in the dark but it is at a deep discount , they seem to know what they are doing .... and EM in general is at a low ebb and its going onto the main market which is deemed to be a positive,so there should be some value here, time will tell.
|This move is likely to contribute to a closing of the discount, which currently stands at a rather unkind 23%:
21 March 2016
VinaCapital Vietnam Opportunity Fund Limited (the "Company" or "VOF")
Cancellation of shares from trading on AIM - Update
VinaCapital Vietnam Opportunity Fund Limited (the "Company") announces that, further to the announcement dated 1 February 2016 concerning the cancellation of its shares from trading on AIM and the admission of its shares to the Premium segment of the Official List and to trading on the London Stock Exchange's main market for listed securities (the "Main Market"), the Company continues to progress the necessary regulatory processes. The Company expects to complete the cancellation of its shares from trading on AIM by 30 March 2016. An indicative timetable of the principle events is presented below.
22 March 2016 Company registration as a Guernsey
23 March 2016 Admission of shares to trading on
AIM under new domicile and new ISIN
23 March 2016 Prospectus published
29 March 2016 Last day of dealings of Ordinary
Shares on AIM
30 March 2016 Company's shares cancelled from trading
on AIM and admitted to the Premium
segment of the Official List and
trading on the Main Market|
|David Stevenson made a good case for VOF (not for the first time) in the 31st July issue of MoneyWeek - a full-page article. He rates fund manager Greg Fisher, who has a 31% exposure to Vietnam in his Asian Prosperity Fund.|
|Interesting snippet from Marc Faber yesterday:
Famously bearish investor Marc Faber says he wouldn't touch Chinese stocks even after their precipitous decline, instead pushing the investment case for Vietnam equities, Hong Kong-listed Macau gaming stocks and gold mining shares.
"I am a buyer when markets are undervalued and attractive and then I get out relatively early. So we were buyers a year ago in June/July of 2014," Faber, the author of the "Gloom, Boom and Doom Report", said, referring to Chinese equities. "Now, I don't think that Chinese stocks are attractive and I would just stand aside."
Chinese equities have taken a severe beating in the recent weeks as panic selling gripped the market, but stability appears to have returned after a series of series of government measures to shore up investor confidence. The benchmark Shanghai Composite is down 24 percent from its June 12 peak, but up 21 percent on a year-to-date basis.
Faber contends that growth in world's second largest economy has "slowed down to trickle", adding that 6-7 percent growth is a "pipe dream."
China, which has set its own growth target at about 7 percent for 2015, is due to publish its latest gross domestic product (GDP) report on Wednesday . The release is expected to show growth dipped below 7 percent in the second quarter, following 7 percent expansion in the first quarter of 2015 - the weakest showing since the global financial crisis.
"We just heard from the Australian treasurer that growth this year in China will be 6.75 percent. It's a pipe dream that will never materialize. Maybe that will be published by the government but the reality is that Chinese growth has slowed down to trickle," he said.
Rather than betting on Chinese A-shares, Faber makes the case for equity investments elsewhere in the region, including Vietnam stocks, which are up 16 percent this year.
Vietnam is the one country that "stands out in Asia", with its strong economic performance and reasonably priced stocks, he said. "In Vietnam you could have a similar situation as in China a year ago, where stocks went up very substantially."|
|Tipped by The Price Report today, part of Moneyweek.|
State shares in the country’s overbearing state-owned entities are to be sold down and restrictions on foreigners holding Vietnamese equities are to be lifted, something analysts suggest will be a “game-changer” that will finally give the country a “properly functioning stock market”.
|chance the changes will lead to discount to nav reducing in a decent fashion as the P Eq element is wound down.|
|McD opened up in Vietnam now too.|
|Nice gain on the Keating sale, and bullish comments from the CEO.
Onwards and upwards.|
|Coca-Cola Co. (KO) said it plans to invest about $300 million over the next three years in Vietnam, looking to use the money to build sustainable growth in the emerging market.
The increased investment, starting next year, will bring the total commitment in the country by Coca-Cola and its bottling partners to $500 million from 2010 to 2015, the company said.
"Vietnam's economy has maintained healthy growth in recent years, and this new financial commitment is more than an investment in Coca-Cola's expansion in Vietnam, it is also an important acknowledgement of our belief in the long-term potential of this key market," Chief Executive Muhtar Kent said during a visit to Hanoi.
The additional spending will go to new infrastructure, jobs and brand building.
Through its investments over the last three years, the company has increased local manufacturing and distribution capacity with new filling lines and the installation of new cold-drink coolers with local customers.|