VinaCapital Vietnam Opportunity Fund Limited AccumUSD · LSE:VOF
VinaCapital Vietnam Opportunity Fund Limited AccumUSD — VinaCapital Vietnam Opportunity Fund — Investor Presentation (May 2021)
30 slides from VinaCapital Vietnam Opportunity Fund Limited AccumUSD's investor presentation, May 27, 2021
Slide 1: VinaCapital Vietnam Opportunity Fund Market and Portfolio Update
VinaCapital Vietnam Opportunity Fund MARKET AND PORTFOLIO UPDATE MAY 2021 1| Classified: Public
Slide 2: Vietnam's unique opportunity
Vietnam’s unique opportunity 97 MILLION 6.5% GDP #1 FDI STABILITY POPULATION YOUNG , 2021 FORECAST, NEXT WAVE OF FDI , STABLE , PRUDENT UPWARDLY MOBILE , FASTEST GROWING IN FACTORY RELOCATIONS GOVERNMENT, ANTI - SPENDING REGION OUT OF CHINA CORRUPTION EFFORTS 2| Source: VinaCapital research, 2021 Cl
Slide 3: About VinaCapital
About VinaCapital ● Founded in 2003, today is one of Vietnam’s largest independent asset managers. ● USD3.5 billion under management, across alternative and traditional assets. ● Single-country focus, invested in over 200 business in Vietnam since inception. ● International standards in ESG, ethics,
Slide 4: VOF's Private Equity approach to investing
VOF’s Private Equity approach to investing Due diligence Performance rights commitment Management Downside involvement Target IRR protection +20% Corporate Milestone governance / disbursement ESG Exit plan 4| Classified: Public
Slide 5: Macroeconomic update
01 Macroeconomic update 1. GDP forecast 2. Consumption driven growth 3. Manufacturing supports economic activity 4. “Stay-at-Home” products 5. Currency outlook 5| Classified: Public
Slide 6: Four Macro Themes for Q2 and Beyond
Four Macro Themes for Q2 and Beyond 1. 6.5% GDP growth in 2021 looks certain 2. Consumption: Remarkably resilient 3. Manufacturing: Positive lending indicators 4. US Fiscal Stimulus & “Stay-At-Home” goods support exports 6| Classified: Public
Slide 7: Vietnam's Resilient Economic Performance in Q1
Vietnam’s Resilient Economic Performance in Q1 Vietnam’s GDP grew 4.5% in Q1, despite: 1. A third COVID outbreak – GDP Growth: 4.5% in Q4 → 4.5% in Q1 – (Despite modest COVID restrictions, late-January to late-March!) 2. A collapse of Foreign Tourism – GDP Growth: 3.7% in Q1, 2020 → 4.5% in Q1, 2021
Slide 8: Resilient Consumption, Despite COVID
Resilient Consumption, Despite COVID VinaCapital’s estimate of Personal Consumption growth* – 1Q20: +2% – 1Q21: +9% Vietnam’s adept COVID handling supports Consumer Confidence COVID Handling Rank Country Lowy Institute Score** 1 New Zealand 94.4 2 Vietnam 90.8 3 Taiwan 86.4 4 Thailand 84.2 5 Cyprus
Slide 9: US Fiscal Stimulus Supports Vietnam's Exports
US Fiscal Stimulus Supports Vietnam’s Exports $600 Stimulus Checks at End-December ① US Retail Sales +7.4% month-on-month in January (~10-Year High Growth) ② Sales of most “Made in Vietnam” Products +15% (near Record-High Growth for Electronics, etc) ③ Vietnam Exports to the US, +72% yoy in Janu
Slide 10: US Consumers Are Still Buying "Stay-At-Home" Products
US Consumers Are Still Buying “Stay-At-Home” Products Vietnam Makes Stay-At-Home and Work-At-Home Products US PC & IT Sales (USDm) US AV Equipment Sales (USDm) Vietnam’s Exports to the US: 80 350 Up 26% in 2020 300 60 250 Up 33% in 1Q21 200 40 150 20 100 2000 2004 2008 2012 2016 2020 2000 2004 2
Slide 11: Strong Demand for "Stay-At-Home" Goods to Continue Into 2022
Strong Demand for “Stay-At-Home” Goods to Continue Into 2022 Workers in the US/Developed Countries Want to Work At Home Employers Willing to Let Employees Work At Home ~2 Days/Week A Plethora of Surveys/Evidence: • 72% of workers want to work at home 2+ days/week • US Workers want to work at home ~½
Slide 12: Currency outlook: Stable with forecast 1-2% appreciation of VND
Currency outlook: Stable with forecast 1-2% appreciation of VND VND Trading Bands – the spread between the Regional Currency (% vs USD) the VND has official and unofficial rates recently widened slightly appreciated while others have devalued 24,500 10 8.6 5.7 23,500 5 4.2 3.3 22,500 1.1 1.7 1.4 1.8
Slide 13: Market
03 MARKET 1. Market performance 2. Liquidity 3. Foreign investor flows 4. Local investor participation 5. Valuations 13| Classified: Public
Slide 14: VN Index: Subsequent COVID-19 outbreaks have little impact
VN Index: Subsequent COVID-19 outbreaks have little impact COVID ONSET OUTBREAK OUTBREAK OUTBREAK 1,600 1,000 30 Jan to 10 Apr 21 Jul to 31 Aug 19 Jan to 8 Feb 27 April… 1,400 800 1,200 A classic event-driven bear market: shorter duration, faster recovery 600 1,000 400 800 200 VN Index (pts, LS, —)
Slide 15: Liquidity: Turnover value on the rise
Liquidity: Turnover value on the rise VNI Avg Daily Turnover Value in excess of USD700m … and catching up rapidly with regional peers 800 3,000 711 2,680 2,500 600 2,000 USDm USDm 1,500 400 265 1,000 912 232 711 742 180 170 200 500 104 301 93 84 84 0 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020
Slide 16: Flows: Foreign investor net outflow
Accumulative net foreign flow into Vietnam Flows: Foreign investor net outflow with block trades returning to positive in 2021 Net foreign flow CY2020 and CYTD2021 CY2020 CYTD2021 603 CY2020 -876 -842 -652 -1,225 -1,094 -2,173 -3,185 1,000 USDm -5,384 0 CYTD2021 (1,000) -9,449 (2,000) Vietnam Indone
Slide 17: Retail investors: Participation at record levels
Retail investors: Participation at record levels Market turnover by Investors Number of trading accounts 100% 4,000 120 100 75% 3,000 80 50% 2,000 60 40 1,000 25% 20 0 0 0% Sep-20 Sep-19 Sep-18 Dec-20 Sep-17 Dec-19 Dec-18 Jun-19 Jun-20 Dec-17 Jun-18 Jun-17 Mar-21 Mar-20 Mar-19 Mar-18 Mar-17 Local re
Slide 18: Valuations: Cheaper market, supported by strong net profit growth
Valuations: Cheaper market, supported by strong net profit growth CONSENSUS EPS GROWTH ESTIMATES PER (x) Vietnam Indonesia Malaysia Vietnam Indonesia Malaysia Philippines Singapore Thailand Philippines Singapore Thailand 179.5 38.2 114.0 30.2 98.1 65.2 28.3 26.3 62.7 22.9 28.2 19.8 26.3 22.3 17.3 1
Slide 19: Portfolio
04 PORTFOLIO 1. Fund performance 2. Sector and asset class allocation 3. Portfolio activity: capital markets and private equity 4. Pipeline and areas of focus 5. ESG’s role in investing 19| Classified: Public
Slide 20: 2021: VOF Performance Highlights
2021: VOF Performance Highlights $1.2 BILLION +47.5% $25 MILLION 6 CENTS NAV 30 APRIL 2021 NAV TOTAL RETURN SHARE BUYBACK 3 SEMI - ANNUAL $7.11 PER SHARE 1 1 J ULY TO 30 APRIL 2 DISCOUNT <12% DIVIDEND INCREASED 4 1. Total NAV and NAV per share, USD terms 2. Source: Bloomberg. VN Index total returns,
Slide 21: Strong performance over financial year to date (FY2021 to April)
Strong performance over financial year to date (FY2021 to April) 10 7 30 April 2021 USD GBP 9 6 8 NAV per share: 7.11 5.14 7 5 6 4 Change (FY2021 YTD)1 45.7% 5 4 3 3 Total NAV (million): 1,211.4 875.9 2 2 1 1 Share price: 6.31 4.56 0 0 Market cap (million): 1,074.9 777.2 Shares bought back VOF share
Slide 22: VOF asset class and sector allocation
VOF asset class and sector allocation VOF Portfolio By Asset Class % VOF Portfolio By Sector % 30 April 20211 30 April 20211 Construction materials 24.3% Bond (3.6%) Operating Financial services 19.9% assets (1.0%) Real estate & construction 19.7% Private equity Food & beverage 7.0% (13.9%) Pharmace
Slide 23: Top Portfolio Holdings as of 30 April 2021
Top Portfolio Holdings as of 30 April 2021 Top 5 Public Equities Holdings Top 5 Private Equity Holdings %NAV2 %NAV2 30 April 2021 30 April 2021 1. Hoa Phat Group (HPG) 21.3 1. An Cuong Wood-Working 3.2 2. Khang Dien House (KDH) 9.6 2. Thu Cuc Medical 1.9 3. Airports Corporation of Vietnam (ACV) 6.0
Slide 24: USD140m in Private Equity investments over past 18 months
USD140m in Private Equity investments over past 18 months Sectors include Healthcare and Real Estate • Leading private hospital / clinic network in Hanoi • Leading Real Estate brokerage and services • Thu Cuc International General Hospital (TCI) • Project “Davos” • 2nd clinic launched in 1Q21, expan
Slide 25: Hoa Phat Group (HOSE: HPG)
Hoa Phat Group (HOSE: HPG) • Vietnam’s leading steel producer • Market cap: USD9.5bn • Profit 2021F: USD1.2bn (+22 y/y) • NAV: USD257m (21.3% NAV) 25| Source: Bloomberg, VinaCapital Research, CafeF.vn. Market capitalization 21 May 2021, NAV as of 30 April 2021, Share price and volume 1 year to 25 Ma
Slide 26: Phu Nhuan Jewelry (HOSE: PNJ)
Phu Nhuan Jewelry (HOSE: PNJ) • Vietnam’s leading jewelry company • Market cap: USD1.0bn • Profit 2021F: USD60m (+22 y/y) • NAV: USD65m (5.3% NAV) 26| Source: Bloomberg, VinaCapital Research, CafeF.vn. Market capitalization 21 May 2021, NAV as of 30 April 2021, Share price and volume 1 year to 25 Ma
Slide 27: Pipeline: Private equity opportunities
Pipeline: Private equity opportunities Asset classes Sectors Structured Investments Real Estate Minimum IRR, protections Financials / Banks Why? Clear exits Private Equity Healthcare Aggressively pursue Uncertain performance Materials Information Technology and Public Equity Education Sufficient cap
Slide 28: Environmental, Social and Governance factors into our investment
Environmental, Social and Governance factors into our investment 13% of Asia-Pacific investors incorporate ESG factors into their decisions or take concrete actions to improve their VinaCapital is a signatory to the portfolio’s ESG performance UN’s Principles for Responsible Investing Private invest
Slide 29: Recap: VOF's investment strategy
Recap: VOF’s investment strategy 01 Growth Capital 02 Minority Protections • Capital to support expansion and growth • Volatility and weak corporate governance is pervasive • Sectors benefitting from the growing domestic economy • Downside protections coupled with clear exit mechanisms • Long term i
Slide 30: Disclaimer
DISCLAIMER The information contained herein has been prepared by VinaCapital Group Limited (the “Company") and is subject to updating, completion, revision, further verification and amendment without notice. The information contained herein has not been approved by any listing authority or any inves
VinaCapital Vietnam Opportunity Fund — Investor Presentation (May 2021) on 6ix