Vinacapital Vietnam Oppo... Share Discussion Threads

[aleman] 24/4/2024 15:40

Vietnamese average wage is up 26% from Q4/2019 to Q4/2023 according to this source.

[shaker45] 24/4/2024 13:10

Yes still a shortage in Hanoi but prices up 13% since 2019 while wages only up 6%. Clearly that trend line can't continue for ever

[dickbush] 24/4/2024 10:37

New apartments in Hanoi sell out despite rising prices - VnExpress International

[shaker45] 24/4/2024 09:38

Property values through s e asia are infected by the mega Chinese property crash (as Chinese are big buyers in other countries), and by over developnent, with demand reduced by over borrowed customers. Each of the properties I own there is worth less than pre covid and I don't anticipate early pick up. But vietnam will recover before other S. E. countries in my view

[amt] 24/4/2024 09:17

Yes property prices are high but interest is picking up.
I notice VOF seems to predict the following days market trend. Market up a lot today but VOF already moved up yesterday. The discount has closed a few % points.

[aleman] 24/4/2024 08:23

Big rises in Vietnam's stock index, though not closed yet. +2.5%. (Edit +2.4% close.)


Whilst HCMC property is only starting to pick up, Hanoi is starting to look a bit frothy already.

[amt] 23/4/2024 08:00

I wasn't aware there had been a property bust. I thought that prices remained very high but the number of transactions had fallen and new projects suspended causing turmoil in the market.

[aleman] 22/4/2024 19:18

Property bust is clearly over.

[aleman] 22/4/2024 12:42

VNI +1.3% today.

From the positive March update:

The earnings season has started, and many Vietnamese companies are in the throes of reporting their first quarter results, which should wrap up by the end of April. Early indications from our Research team show that show we may be in for a strong level of core earnings growth for the first quarter, driven by a robust recovery in cyclical sectors such as Aviation, Construction Materials, and Consumers. The Banking sector, which is a key pillar of economic activity and the largest constituent of the index, is showing a potential for approximately 10% year-on-year earnings growth, but potentially compressed by lower net interest margins after coming off a high base in 2023 when the domestic interest rate environment was much higher. As such, our Research team expect robust earnings growth over the next two years, ranging from 15% to 20% year-on-year for 2024 and 2025. The stock market’s valuations are creeping up, at a 11x forward price-to-earnings ratio and now slightly within one standard deviation from the historical average PER of 14x. That being said, the market is still at a 20% discount to regional peer averages, and with a prospect of robust compounding earnings growth over the next two years, the Vietnam market today presents an attractive opportunity for investors to consider allocating beyond India and Japan.

[amt] 19/4/2024 18:50

Spangle93.
I do still hold a position. I sold about 80% of my holdings. The point of the BB is to have a discussion. I have also been civil and polite in my responses.
I appreciate posts that contain useful information and discussion so that I can decide what to do with my remaining holding. There have been some great posts today. I have taken on board what people have written while challenging some of the posts.
I posted that I had read that corruption was endemic in Vietnam. So I was interested to hear what others had to say about it. Perhaps you could enlighten me if you have a view about it. It might be that corruption is not such a big deal so any info would be appreciated.

Certainly if what I had read was in isolation I would have formed the view that Vietnam is uninvestable at the moment and sold everything. However I see from what people have posted here that the situation might be OK and the markets will put this behind them quickiy and move onwards and upwards. So on that basis I will maintain an interest and may buy back in at some stage when things have settled down. However the events of the last week have cast a large shadow over my previous conviction that Vietnam was a safe place to invest with great opportunities ahead. Now I see it as high risk but with the potential to give good returns over the longterm.
I also conclude that this recent news explains some of the recent falls in the market as the extent of the issue has been revealed. At the same time the issue of corruption in general has probably been one of the reasons for the market being held back in the last couple of years which had baffled me before. The rumours surrounding the banking sector would not have helped and very few people would have known about the extent of the problem and certainly I have seen no evidence from my reading in general and from the posts on this board that the enormity of this issue was known to investors in general and therefore already discounted in share prices.
The replies to my posts have helped me reach this conclusion.

[spangle93] 19/4/2024 18:43

thanks amt, you've made your point very clearly. We understand. You posted that you sold out yesterday, due to fears of either a major correction once the full force of the scandal emerges. This was then extended into a sweeping statement that corruption in Vietnam is endemic. For someone who has no position, it seems a wee mite odd to continue with relentless negativity dressed up as justification, despite a lot of polite posting in response expressing a contrary view. I, and I'm sure others too, am grateful for your expertise and for you sharing your research, but can you and the regular posters on here now just agree to differ? :-)


Mancman - I think they said yesterday that PE was currently about 30% of their total assets, but that may help to explain your other point, i.e that VNH was more stable than the index.

[amt] 19/4/2024 18:31

Thanks.for the article but it confirms that at that time there was no hint of the enormity of this catastrophe.
The article mentions a fraud of tens of millions of dollars not 24 billion so it wouldn't have been anything to get too concerned about at the time. So not surprising that most people would have remained in the dark and those who read this would have been comforted by what appeared to be a relatively small issue and by the fact that corruption was being tackled. As we heard last week it's the biggest fraud in History and the bank is still being supported by the central bank. The scale is mind-boggling.

[amt] 19/4/2024 14:10

Thanks for the info, therefore wasn't reported in Autumn 2022 then.

[shaker45] 19/4/2024 12:53

Reported in Vietnam press last autumn. Hardly a secret. High profile woman behind it now sentenced to death which sparked western media interest recently

[amt] 19/4/2024 12:04

All three registered big falls in Sept/Oct 2022 when I assume news of the fraud first appeared

The fraud wasn't reported until last week. Banking problems yes but only noted as liquidity problems and nothing of great significance.

[mancman1] 19/4/2024 11:32

VNH incidentally trades at around NAV levels, VOF trades at a 20% discount, not that dissimilar to pretty well every private equity investment trust that I am aware of. RCP, which has around 40% private equity, trades near a 30% discount.

[mancman1] 19/4/2024 11:26

I have been looking back at the five year VOF chart and comparing it with the Vietnam Index and VNH.

All three registered big falls in Sept/Oct 2022 when I assume news of the fraud first appeared. VOF and the Index have recovered since then, although both are still well off their pre Sept 2022 peaks. VOF has I think been more stable than the index. VNH on the other hand has surged way past its previous levels. I am fairly relaxed about VOF as an investment, but it represents only 1.4% of my portfolio. I would be a bit more nervous of VNH I think.

[amt] 19/4/2024 10:11

Vof holding up well considering a 7% fall in the main index this week

[amt] 19/4/2024 10:08

I have looked through all the posts and news in general in Autumn of 2022 and there was no mention of the reasons behind the issues with this bank. Some mention of liquidity issues but not of much significance. The market fall of more like low 20% was matched by other World markets at that time so Vietnam didn't stand out particularly. What struck me was the general muted recovery since then when other markets were booming and everything seemed to be great for Vietnam. Maybe the few in the know were selling while the majority like me were unaware that the biggest fraud in history which needed a collosal bailout was happening in secracy. I suspect these issues that have now come to the fore so many more will be reconsidering their position. You might be right that longterm this will be good but I fear sentiment is against the market at the moment. If people here believe this story has been in the public domain for the last couple of years I am staggered and can't understand why they didn't mention it.

[shaker45] 19/4/2024 09:20

This fraud and bail out has been in the public domain long enough to be priced in. Corruption is endemic in this part of the world and shouldn't impact Vietnam's investment status. Remember Lehman, Madoff? Not only vietnam

[aleman] 19/4/2024 09:13

If you look at the market reaction now compared to the market reaction at the end of 2022, it suggests that most people in the markets were already aware of the problem and the reaction is just because the size of the bailout has been a bit bigger than expected. It does not seem to be doing that much damage since there is currently a huge foreign direct investmnet boom going on with all sorts of deals ongoing and new ones being signed off, as posted in previous links. I'm pretty sure due diligence for these deals will have included investigations into the repercussions from this very high profile fraud trial.