Vietnam Enterprise Inves... Share Discussion Threads

[aleman] 05/12/2024 09:34

Breaking out?


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[31337 c0d3r] 27/11/2024 09:38

Around 20 years ago many of these boards were buzzing with speculation Bill Gates was building a stake. It was always just ramping.

Fast forward 20 years, and we discover Bill Gates has actually built a hefty 15% stake in VEIL yet nobody seems to notice.

[shaker45] 13/11/2024 03:18

Very good overview

[31337 c0d3r] 12/11/2024 15:19

Doesn't seem right the director purchased £59,246.76 worth of shares the day before releasing this update.

[31337 c0d3r] 12/11/2024 15:04

RNS Number : 8660L
Vietnam Enterprise Investments Ltd
12 November 2024

12 November 2024

Vietnam Enterprise Investments Limited

("VEIL" or the "Company")

Quarterly Insights

VEIL is a London listed investment company investing primarily in listed equities in Vietnam and a FTSE 250 constituent.

Vietnam's Opportunities and Challenges in the Wake of Trump's Election Victory

Mr Tuan Le, Lead Portfolio Manager

The implications of Donald Trump's re-election for Vietnam's trade-driven economy are complex, with a potentially accelerated shift in US economic policy toward national competitiveness likely to inject volatility and uncertainty into emerging markets.

Equity Market Outlook

In the years leading up to the pandemic under Trump's first term, Vietnam's equity market delivered strong performance, with net profit growth reaching 19.1%. However, the unpredictability of Trump's policies and public statements heightened market volatility, leading to a discount on valuations despite underlying earnings growth. During this period, the VN Index achieved a compounded return of around 15%, slightly trailing profit growth due to those volatility concerns.

While Vietnam's economic and trade outlook remains relatively positive, supported by pro-growth domestic policies, the potential strengthening of the dollar could increase foreign selling in emerging markets in favour of US equities. Emerging markets, including Vietnam, may continue to see valuation discounts, as was the case during Trump's previous term.

Consequently, expected returns in Vietnam's equity market may lag earnings growth. While this risk is notable, the valuation of our Top-80 universe of stocks remains at 11.6x based on projected 2024 earnings, compared to the five-year historical average of 13.9x, suggesting limited room for further de-rating due to support from domestic investors seeking value. The extent to which Vietnamese investors can offset the potential continuation of foreign outflows, already over US$3 billion year-to-date, will be an important factor in the medium term.

Domestic interest rates can also play an important role in supporting local equity flows. Retail deposit rates for 12-month terms are at near all-time lows of approximately 5.7%, making term deposits less attractive compared to potential equity market gains, likely encouraging investors to favour equities. While rates are expected to stay stable as the government supports economic growth through a lower rate environment, potential shifts in Trump's renewed agenda could introduce additional uncertainties.

Currency Concerns

Exchange rate stability has been a focal point of US monitoring in recent years. In 2020, the US Treasury labelled Vietnam a currency manipulator, citing Vietnam's high trade surplus, a strong current account, and foreign exchange interventions. Although this designation was removed in 2021, Vietnam remains on the US Treasury's monitoring list.

To counter concerns about competitive devaluation, the Vietnamese government has taken clear steps to prevent excessive devaluation of the dong. Since 2022, the State Bank of Vietnam has deployed over US$20 billion in reserves to stabilise the currency, signalling its commitment to exchange rate stability and allay concerns over competitive devaluation.

Potential Impact of New Tariffs

Trump's election could reintroduce high tariffs and renegotiations of trade agreements, thereby amplifying market volatility but simultaneously enhancing Vietnam's role as an alternative manufacturing hub.

Trump's economic agenda, including tax cuts, deregulation, and increased deficit spending, may strengthen the dollar, which presents a mixed scenario for Vietnam's capital markets and export-oriented sectors. These sectors may face heightened trade barriers but could also benefit from redirected trade flows due to shifts in global manufacturing.

Among Trump's proposed policies are a 60% tariff on Chinese imports and an additional 10-20% tariff on imports from other trade-surplus nations. While a blanket tariff on all imports is unlikely given the potential impact on US consumers, we believe targeted tariffs on sectors with high export volume to the US may become a reality. Vietnam, with a strong presence in industries like electronics and textiles, may be at risk of such targeted measures.

To offset potential trade restrictions, Vietnam could work toward narrowing its trade surplus with the US by increasing imports of high-value goods such as aircraft, energy, and technology, contributing to a more balanced trade relationship. The government is also actively addressing transhipment risks, particularly for goods suspected of being re-routed through Vietnam to bypass US tariffs on Chinese products. For instance, Vietnam's Ministry of Industry and Trade has launched investigations into steel imports from China and South Korea to deter illegal re-export practices and reinforce its commitment to legitimate trade.

Implications for the Road Ahead

With China accounting for 32% of global manufacturing and Vietnam at 2-3%, Trump's re-election may prompt further shifts in supply chains away from China. As new trade barriers pressure Chinese exports, countries like Vietnam are positioned to benefit, much as they did during Trump's first term. However, this opportunity comes with a likely increase in scrutiny of Vietnamese goods, particularly in sectors with strong FDI links to China or those at risk of transhipment issues.

On balance, the outlook appears positive for Vietnam, with opportunities to capture a larger share of the global supply chain as production diversifies. Vietnam's government is expected to take proactive steps, drawing on experience to implement pre-emptive measures. This environment could provide momentum for key policy shifts, such as formal agreements with the US to clarify rules of origin, address transhipment concerns, and promote accelerated localisation within Vietnamese industries. Greater localisation would strengthen supply chain resilience and create the potential for domestic firms to move beyond OEM manufacturing toward capturing more value in direct-to-consumer markets.

[Table does not tabulate correctly in ADVFN posts. See original news article here]


Top Ten Holdings (59.4% of NAV)

Source: Bloomberg, Dragon Capital

NB: All returns are given in total return USD terms as of 30 September 2024



For further information, please contact:

Vietnam Enterprise Investments Limited

Rachel Hill

[31337 c0d3r] 12/11/2024 14:58

PDMR Notification


The Company has received notification that Sarah Arkle, a director of the Company, purchased 10,304 ordinary shares in the Company on 11 November 2024 at an average price of £5.74988 per share (for an aggregate price of £59,246.76).

Following this purchase, Sarah Arkle holds 20,000 ordinary shares in the Company.

[31337 c0d3r] 19/7/2024 10:03

New research report on VEIL.

"Vietnam looks set for a year of recovery in 2024, with corporate earnings rebounding after two weak years, buoyed by notable recovery in export growth, domestic manufacturing and consumption. Vietnam Enterprise Investments’ (VEIL’s) new manager Tuan Le has positioned the portfolio for this recovery..."

Full article:

[amt] 16/5/2024 07:15

Bought back in as things have settled down. Only 3.5% higher than when I sold so not much damage. I am much more cautious than before and treat this as a high risk market.

[amt] 18/4/2024 07:16

I am afraid I have sold out this morning. I hadn't realised the level of corruption and their attempts to fight it are having catastrophic consequences with a financial crisis coming out of nowhere.
Very disappointed since I always thought the risk was low here but infact it seems its very high risk.
I will see how things pan out in the next couple of years and might reenter at some stage. If they can conquer corruption that will be great longterm but the short term looks problematic to say the least.

[amt] 16/4/2024 04:49

The sudden fall yesterday seems to have been caused by panic selling after false reports about various companies appeared on social media. Seems like manipulation.
The macro economic situation is excellent and profits of companies growing fast plus upgrade of stock market to emerging market status likely later next year. A cut in US interest rates would help but that time keeps receding.

[amt] 15/4/2024 09:22

4.7% fall.

Tim Cooke visiting today, perhaps he should have stayed at home.

[aleman] 15/4/2024 08:20

It was only a modest drop until an hour ago. I suspect it might be linked to this breaking news, which is quite big in an economy where gold is a major form of saving and a shortage of bars has seen the local price 30% or so above global prices. It could have been a trigger for some short-term profit-taking after a few decent months of gains. If so, I think it is likely to be a temporary blip as far as stockmarkets are concerned.

[amt] 15/4/2024 07:55

Why such a huge drop in the stockmarket today ?

[amt] 12/4/2024 06:57

Market getting some positive momentum going

[amt] 19/2/2024 07:42

The market is building strong momentum

[amt] 04/1/2024 07:21

Good start to New Year and 20% discount too good an opportunity to miss out on so I topped up.

[arja] 11/10/2023 13:54

odd that VEIL down 6 today but VOF up 8 ! must be a move to make the discounts to NAV more in line :)

[31337 c0d3r] 10/9/2023 10:27

Vietnam to upgrade US relationship to level with China

Biden set to sign strategic partnership on Hanoi visit to counter Beijing’s assertiveness in region.



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[dickiehh] 08/9/2023 09:38

Veil looks very good value to me atm. Vietnam one of the few countries where stock market doing well. Veil is on a discount of nearly 20 percent (620/764 NAV)

[arja] 07/9/2023 12:09

picked VOF for today's day or overnight trade but should have licked VEIL as it has done well today and seems that it varies between these 2 trusts at times . VNH is a MM stock and I avoid

[aleman] 01/8/2023 07:52

£ v $ , £ v Dong


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[arja] 01/8/2023 07:18

aleman and hpcg- most helpful comments appreciated and I notice VOF moved higher during the day and I wish I had bought at 464 level ( wry smile ) . Certainly the Vietnem indices up a bit today and chart shows a lovely uptrend and probably more to come . must check as to how the vietnamese currency is against sterling as that is very relevant .

[hpcg] 31/7/2023 10:33

arja - VOF, which I also hold, has PE/VC investments, so a) the NAV is less reliable, b) some investors don't like them. On the flip side they provide a lot of juice in good times. Ultimately the answer is always flows, and if an institution has decided to back Vietnam through VEIL then it will close the discount much faster. It is why I ultimately decided to choose both. Strategically I don't like a hedged option because over time the Dong will appreciate over sterling, even if over the short term, e.g. since October 2022, this can be a headwind.