VietNam Holding Limited · LSE:VNH
VietNam — Investor Presentation (July 2022)
32 slides from VietNam's investor presentation, July 2022
Slide 1: Vietnam Holding (LSE: VNH)
Vietnam Holding (LSE: VNH) July 2022
Slide 2: Vietnam Holding Ltd Overview
Vietnam Holding Ltd Overview Closed-end fund Partner owned +15.9%* p.a. over 10 years c.£88m listed on LSE Manager with Market cap Main Market locally based team Vietnam All Share +9.4% ** p.a. Nimble stock selection, actively managed, high-conviction portfolio with integrated ESG Thematic exposures
Slide 3: Portfolio: Growth at a Reasonable Price (GARP)
Portfolio Growth at a Reasonable Price (GARP) Earnings per share growth VNH VNAS 59.4% 60% Investment Criteria 47.3% 40% • Compounding long-term EPS growth (c20% pa) 27.8% 28.0% 20.2% 22.0% 17.6% 19.1% • Attractive valuation with built-in safety margin 20% 5.4% 3.5% • Strong balance sheet and cash f
Slide 4: Content
Content 1. Vietnam: Asia’s Emerging Champion 2. Vietnam Equity Market: More Opportunities After the Correction 3. Vietnam Holding Portfolio: Sustainable Growth – Strong Track Record 4. Summary 4
Slide 5: Vietnam at a glance
Vietnam at a glance Asia’s Emerging Champion Population 98.5mn 32.5 years 85% Population Median age Ethnic Kinh 15th in the world Youngest in ASEAN Stable socio-political environment 98% >77% 37% Literacy rate Internet penetration Urbanization 2nd highest among top 30% per annum growth in Japan 10 i
Slide 6: Vietnam Macro: Strong recovery domestically
Vietnam Macro Strong recovery domestically – but rising external risks 2022 GDP growth expected to be back to long-term level 8% 7.7% • Q2 GDP growth was much higher than expected. The full year target of 6.5% is still intact. • 1H2022 public investment disbursement was slow at 35.3% of the whole 6%
Slide 7: Vietnam Macro: Manufacturing sector accelerating
Vietnam Macro Manufacturing sector accelerating High import and export growth maintained The manufacturing sector continued recovering Import/Export Growth of Vietnam (%) PMI Manufacturing Index 65 60% Import growth (YoY, %) Export growth (YoY, %) 50% 60 Vietnam, 54 40% US, 52.7 55 Japan, 52.7 EU, 5
Slide 8: Vietnam Macro: Disbursed FDI strong, retail sales recovered
Vietnam Macro Disbursed FDI strong – and retail sales recovered further Registered and disbursed FDI (bn USD) Retail sales recovered further in June 2022 (%) 40 38.0 Registered FDI 40% 35.9 35.5 27.30% 35 Disbursed FDI 30% 31.2 30 28.5 20% 24.4 25 22.8 10% 21.7 21.9 20.4 20.0 19.7 20 19.1 17.5 0% 15
Slide 9: Vietnam Macro: Strong FX reserves, dollar strength
Vietnam Macro Strong FX reserves but dollar strength impacting local currency high FX reserves (USD bn) VND depreciated 2.6% YTD against USD 120 5 5% FX Reserves (LHS) EU MSCI EM Total reserves in months of imports (RHS) Vietnam China 109 Japan Korean 100 4.0 100 4 0% 95 3.7 3.4 80 78 3 -5% 2.5 2.5
Slide 10: Vietnam Macro: Trade partners and foreign debt
Vietnam Macro Portfolio of trade partners helping to hedge currency risk – manageable foreign debt Diversified trade partners foreign debts as of % of GDP YTD 55% Surplus/ 5M export 5M import currency Country Deficit (USD bn) (USD bn) valuation (USD bn) 50% vs. USD China 21.98 49.61 -27.63 -3.27% 45
Slide 11: Vietnam Macro: Controllable inflation
Vietnam Macro Controllable inflation 100% 90% • Vietnam’s urbanisation level (40%) is still low so consumes less Others, 31.8% energy as compared to the West. 80% Others, 38.0% • 50% of Vietnam’s energy mix is through domestic renewables (Hydro, Solar and Wind) and Vietnam has Oil, Gas and Coal 70%
Slide 12: Vietnam Macro: Resilient energy mix
Vietnam Macro Resilient energy mix, though input costs have risen The electricity price under control Crude oil trade deficit about 1% of GDP Value of import and export of crude oil of Vietnam 2021 Source of electricity in 2021 (USD bn) 6 5.2 5 Hydro, 31% 4 Coal, 47% 3 2 1.8 Gas-fired, 10% 1 Renewab
Slide 13: Vietnam Macro: Peak of inflation could be delayed to 2023
Vietnam Macro The peak of inflation in Vietnam could be delayed to 2023 Vietnam interbank even decreased in June 2022 Vietnam government bond yields inched up in June 2022 (%) 4% 8% ON 1W 1M 3M 1Y 3Y 5Y 10Y 3% 6% 2% 4% 1% 2% 0% 0% Jun-20 Oct-20 Jan-21 Apr-21 Aug-21 Nov-21 Feb-22 Jun-22 Jun-16 May-17
Slide 14: Content
Content 1. Vietnam: Asia’s Emerging Champion 2. Vietnam Equity Market: More Opportunities After the Correction 3. Vietnam Holding Portfolio: Sustainable Growth – Strong Track Record 4. Summary 14
Slide 15: Steep correction in H1 2022
Vietnam Equity Market Steep correction in H12022 – and large-caps performed better than mid-caps The Vietnam equity market corrected sharply over the last two months more opportunities at these current valuation levels US$ mn 25 1800 2000 VNIndex PER 23 1600 Liquidity (RHS) 1800 VN30 PER 21 VNIndex
Slide 16: Attractive valuation and profit levels compared to rest of Asia
Vietnam Equity Market Attractive valuation and profit levels compared to rest of Asia Valuation remains in line with regional peers With higher profitability 20% 2.6 18% 17.4% ROE ROA 2.4 16% 2.2 14% 13.7% 2.0 Price to Book (x) 12% 11.5% 1.8 VNAS, 1.2% 10.4% 10% 9.0% 9.2% Philippines, 2.1% 1.6 7.8%
Slide 17: Content
Content 1. Vietnam: Asia’s Emerging Champion 2. Vietnam Equity Market: More Opportunities After the Correction 3. Vietnam Holding Portfolio: Sustainable Growth – Strong Track Record 4. Summary 17
Slide 18: Investment Philosophy and Approach
VNH Portfolio Investment Philosophy and Approach • Combining top-down and bottom-up strategies for a balanced portfolio Top down – Bottom • Top-down: Portfolio structuring process integrating macroeconomic up forecasts into asset allocation • Bottom-up: Extensive analysis and disciplined investment
Slide 19: High Conviction/Concentrated Portfolio Across Key Themes
VNH Portfolio High Conviction/Concentrated Portfolio Across Key Themes of Domestic Consumption, Urbanization and Industrialization Top Ten Holdings Sector Allocation Company % NAV Banks 22.0% FPT Corp 11.5% Industrial Goods and Services 18.0% Mobile World 9.2% Gemadept 8.5% Retail 18.0% Phu Nhuan Je
Slide 20: High Active Weight (70%) with Median Cap of US$1,337m
VNH Portfolio High Active Weight (70%) with Median Cap of US$1,337m VNH Portfolio VN All Share Index Large Cap (>US$1bn) 7.8% Mid & Small Cap (<US$1bn) 29.5% 25.2% Cash 74.8% 62.7% Source: Dynam Capital, Bloomberg; Data as of 30 June 2022 20
Slide 21: NAV per Share Performance vs. VNAS Index
VNH Portfolio NAV per Share Performance vs. VNAS Index VNH NAV MSCI FTSE VNAS (USD) per Share Emerging Market All-Share 1 year -4.4% -16.5% -27.2% -13.4% 3 years 61.9% 43.1% -5.1% -6.8% Source: Dynam Capital, Bloomberg; Data as of 30 June 2022 21
Slide 22: 10-year NAV per Share Performance vs. VNAS Index
VNH Portfolio 10-year NAV per Share Performance vs. VNAS Index (May 2012 – May 2022) 350% VNH's NAV per share (USD) VNIndex (USD) 300% Vietnam All Share Index (USD) MSCI EM 250% MSCI FM 200% 150% 100% 50% 0% -50% Jun-12 Jun-13 Jun-14 Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 Jun-20 Jun-21 Jun-22 Source: Dy
Slide 23: FPT Corporation (FPT: HOSE)
FPT Corporation (FPT: HOSE) Digital Champion Investment Case Key financial highlight 2022F Stock information • The company is transforming from an IT service company to an end-to- end digital transformation solutions provider, with forecast CAGR of EPS growth 22.9% Market cap (USD mn) 4,333 17.1% du
Slide 24: Mobile World JSC (MWG: HOSE)
Mobile World JSC (MWG: HOSE) Omni-channel retail champion Investment Case • With a 60% market share in the smartphone market and a 50% market share Key financial highlight 2022F Stock information in the consumer electronics market, MWG is the biggest retailer in Vietnam by EPS growth 20.8% Market ca
Slide 25: Gemadept Corporation (GMD: HOSE)
Gemadept Corporation(GMD: HOSE) Logistics Champion Investment Case • Gemalink, a deep-water port in the South of Vietnam, commenced Key financial highlight 2022F Stock information operations since Jan 2021, GMD is now the second biggest seaport EPS growth 59.9% Market cap (USD mn) 725 operator in Vi
Slide 26: Phu Nhuan Jewelry (PNJ: HOSE)
Phu Nhuan Jewelry (PNJ: HOSE) Gold and Jewelry Retail Champion Investment Case Key financial highlight 2022F Stock information • Vietnam’s jewelry market is growing at double digit rates as a result of fast-growing mass-affluent class and changing consumer preferences. EPS growth 54.6% Market cap (U
Slide 27: Sacombank (STB: HOSE)
Sacombank (STB: HOSE) Investment Case • STB is the 10th largest bank in Vietnam and the 6th largest private Key financial highlight 2022F Stock information sector banks by assets. It currently has the most extensive branch EPS growth 23.2% Market cap (USD mn) 1,817 network among its private peers wi
Slide 28: Content
Content 1. Vietnam: Asia’s Emerging Champion 2. Vietnam Equity Market: More Opportunities After the Correction 3. Vietnam Holding Portfolio: Sustainable Growth – Strong Track Record 4. Summary 28
Slide 29: Why now?
Why now? Expanding capital markets, increasing liquidity, inflection point in economic growth 100% VNIndex MSCI China Index • Top Performing Stock Market Globally: Vietnam’s MSCI India Index stock market has outperformed China and India over the 75% MSCI Emerging market last five years. FTSE All-Sha
Slide 30: Summary: Vietnam Holding Limited fund terms
Vietnam Holding Summary Vietnam Holding Limited LSE: VNH Inception June 2006 Investment Universe Equities in Vietnam ISIN / BIC Code GG00BJQZ9H10 / SCBLSGSG Fund Type Closed-End / Active management Base Currency USD with GBP quote Style Growth At a Reasonable Price/ESG Integration Fund Size (As of 3
Slide 31: Disclaimer
Disclaimer This presentation relates to Vietnam Holding Limited (the "Company") and has been prepared by Dynam Capital, Ltd. ("Dynam"). This presentation is for information and discussion purposes only and should not be considered to be an offer or solicitation of an offer to buy or sell shares in t
Slide 32: Contact us
Contact us Craig Martin Vu Quang Thinh Chairman CIO craig@dynamcapital.com thinh.vu@dynamcapital.com www.dynamcapital.com