Market reports

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk24.2018 VN

18-06-2018 17:37:43

What’s on deck in economics? Fed lifting the federal-fund rates to a range of 1.75% - 2% for second time in 2018. The Federal Reserve on Wednesday lifted rates by a quarter-percentage point — to a range of 1.75% to 2%; signaling, perhaps, two more increases to key interest rates remaining in the year. The rise in rate hinted foreign capital outflow from Vietnam through “carry trade” traders, in our view. Weekly average O/N rate edged down to 1.43% while the central bank withdrew a hefty value of VND 47,700 via T-bill issuance. The weekly average O/N rate fell slightly to 1.43%, from 1.6% last week. The lower O/N rate implied the back-to-normal liquidity in banking system. The central bank turned to net-withdrawal position at large scale of VND 47,700bn through T-bill issuance. It noted that T-bill was with longer tenor of 28 days and 91 days, instead of 7 days. It implies that the SBV do not wish to inject more money in next 3 months. Market Watch Vietnam stock market retreated to close lower when the investors increased their profit-taking activities. The Vnindex fell in correction territory after two-week winning streak when the investors increased their profit-taking activities as well as received no supportive macro news. Admittedly, the Vnindex fell 22.5 points, or 2.17%, to close 1016.5. All nine primary Vnindex sectors finished in negative territory, led by loss in financials and basic materials, a drop in 2.96% and 2.72% respectively. The financial sector dragged down by a decline in VHM (-2.96 %), TCB (-1.22%) and CTG (-5.18%) when the investors following “buy on dip” strategy to take short-term profit. The foreign investors turned to be net seller with USD 63.83mn, focusing on VIC and HPG, when it is the last week for ETF quarterly portfolio rebalance.   

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk22.2018

05-06-2018 10:01:46

What’s on deck in economics? Inflation accelerates to highest level since April 2017. According to data released by the General Statistics Office (GSO), May 2018 CPI accelerated to 3.86% year on year (YoY), marking the 12-month highest CPI headlines since April 2017. The data supported our view in last report (The Vietnam StreetWise Wk.052018) when the base effect dropped out and cost-push inflationary pressure came from the rise in global oil prices. The annual food and transportation reached 3.36% (up from negative 2.31% last year) and 7.83% (down from 8.10% last year); contributing the most to inflation. The inflationary pressures is expected to leave no room for SBV use the loose monetary policy. We, however, expect the inflation will trend upward at slower pace when core inflation, which excludes food and energy prices, registered to 1.37% YoY, the manageable level. (Chart of the Week)   Market Watch Vietnam stock market turns corner as inflation risks are already priced in. The Vnindex seems to have turned the corner, overcoming concerns about inflation, as witnessed by solid weekly gain. Admittedly, the Vnindex rose 28.97 points, or 3.01%, to close at 992.8 above the key level of 943.68 (weekly MA50) when the investors left the higher May inflation of 3.81 YoY behind. The investor welcomed the higher index when they weighted on the coming 1H2018 earning season. 6/9 sectors finished in positive territory. The financial and basic material led the gain, up 6.18% and 4.79% respectively. In financial sector, VIC (+11.08%) and VCB (+13.87%) were notable gainers when VIC welcomed listing of subsidiary Vinhomes and VCB got foreign investors following “buy on dip” strategy. The foreign investors continued to be net seller of hefty value of USD 47.67mn following the money outflow from frontier market due to mounting concern over Argentina high-inflation economy as well as taking the profit.

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk19.2018

15-05-2018 14:15:20

What’s on deck in economics? The state budget is on track for fiscal consolidation. Data released by Ministry of Finance (MoF) showed that the budget was on track for fiscal consolidation. On the revenue side, the government collected USD 19.63bn, marking a 12.1% YoY increase, owing to improved local tax collection (+14.5%) and rising crude oil collection (+27%) in spite of lowing customs revenue (-4.1%) resulting from applying ASEAN duty-free regime. On the expenditure side, the government spent USD 18.03bn, representing a slight 4.6% YoY increase, largely owing to a 5.2% drop in investment expenditure. The faster pace of revenue collection leaves the budget surplus of USD 1.6bn. The minor surplus underpins fiscal consolidation in 2018 as the government seeks to rein in the country’s ratio of public debt to GDP. (Chart of the Week)   Market Watch Vietnam stock market eked out a modest gain, snapping 04-week losing streak. The Vnindex was up 18.05 points, or 1.76%, to 1044.8; ending 04-week losing streak. In our view, it is only the weekly correction after AGM and earning season factors fading. The energy sector had been the biggest gainer (+8.21%) of which notable gainers was GAS (+13.33% owa), following US President’s decision to pull out of a multilateral nuclear deal with Iran, leaving the oil price retreat from its highest level since 2014. The industrial sector helped to push index into positive territory, led by FLC (+9.81%), VJC (+7.28%) and CTD (7.55%). The foreign investors turned to net buyers with modest value of USD 6.38mn.

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk13.2018 VN

02-04-2018 11:11:17

What’s on deck in economics? 1Q2018 Vietnam economy started strong foot. Data released by General Statistics Office (GSO) on March, 29 2018 confirmed the Vietnam economy is doing well. The real GDP growth came in at a strong 7.4% YoY in 1Q2018. It appears that the strong momentum in manufacturing has carried over into the start of 2018, with output growing by 13.6% YoY while the mining sector on the road to recovery recorded growth by 0.4%, ending the double-digit contraction (10% YoY) since 1Q2017. Agriculture sector also recorded its 6-year high of 4.05%. Services sector growth came in at a modest 6.7%, on a par with the 6.5% last year. The first quarter robust outturn means that the full-year real GDP growth target of 6.7% is well within reach. Although economic activities remains strong in 1Q2018, the consumer price index (CPI) dipped in March for the first time since June 2017, leaving the inflation increased by 2.66% YoY (or 0.97% YTD). It appears to be simply an ironing-out of Tet holiday-related factors. (Chart of the Week)  Market Watch Vietnam stock market logged six winning streak with technology and financial sectors leading the rally. The VNindex was on track for sixth weekly gain in a row. The Vnindex was up 20.87 points, or 1.81%, to finish weekly record above 1174 since 2007. The index clinched its sixth straight weekly advance since Tet Eve. The smart money was on rotational buying ahead of 1Q2018 earnings and AGM seasons. The technology sector rallied 4.47% of which notable gainers was CMG (+13.19% owa). The financial sector helped to push index into positive territory, led by VIC (+7.07%) and VRE (2.54%). The surge in VIC’s stock marked the Vingroup as the first-time largest market capital, surpassing Vinamilk. The foreign investors turned to net selling value of USD 1.19mn to log 1Q2018 profit/loss in Net Asset Value (NAV) report

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk12.2018

26-03-2018 15:11:17

What’s on deck in economics? Underground economy accounted for 25-30% GDP. In 2018, the government is working hard to bring the underground economy into the formal sector. Some media reported that the sector accounted for some 25-30% GDP and employed nearly 60% of workers. Putting informal work into the statistics supports more tax collection and reduce fiscal deficit when the import duties from ASEAN are phased out, in our view. In addition, the informal work makes Debt/GDP ratio more rosy when the size of GDP increases at least by 20%. Market Watch Vietnam stock market logged five winning streak albeit the worries of global trade ware rose. The VNindex was on track for fifth weekly gain in a row. The Vnindex was up 3.64 points, or 0.30%, to finish weekly session at 1,153. The index clinched its fifth straight weekly advance since Tet Eve. The smart money was on rotational buying ahead of 1Q2018 earnings and AGM seasons. The healthcare sector extended rally 4.30% of which notable gainers was DHG (+10.43% owa). The energy sector helped to push index into positive territory after oil prices extended advance by 6.16%. The foreign investors snapped 05 selling streak with net buying value of USD 29.89mn, a good support amid market sideway.

TVS Research Portfolio Model - Bi - Weekly Updates - March 16 2018

20-03-2018 06:15:04

Portfolio Performance Review ·         Our Model Portfolio (MP) focused on the large-cap, namely financial (46% market cap) and consumer (25% market cap), with value bias where we assume the stock prices are undervalued in term of (i) valuation, (ii) superior future growth and (iii) company-specific elements, including industry leader and good management team. (Please see our Table in next page) ·         Our MP value recorded growth of 19.4% YTD, outperforming slightly 16.9% of Vnindex. Our favorite stock picks in financial sector, namely VPB (56.8% YTD) and MBB (+44.8% YTD), continued contribution of 15.25% total return while MWG’s performance dragged 2.69% total portfolio return down. ·         MBB (TVS Wk04.2018). Our investment ideas are on the back: (i) healthier balance sheet, (ii) good net interest margin and (iii) attractive valuation with 2.08x P/B delivering ROE~14.81%. With an improving growth profile, MBB deserves to trade with peers, typically ACB, in our view. ·         VPB (TVS Wk05.2018). Our investment ideas are on the back: (i) aggressive NPAT plan of VND 10,800bn (+32.95%YoY), and (ii) a plan to divest partial stake of FE Credit, a VPB’s subsidiary specializing in consumer finance.

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk11.2018

20-03-2018 06:14:05

What’s on deck in economics? Solid Economic Growth for 1Q2018. During New Zealand’s visit, the Prime Minister Nguyen Xuan Phuc informed that Vietnam’s real GDP may surge to 7.41% in 1Q2018 – the highest growth rate seen since 1Q2009. The substanial pick-up in the first quarter 2018 is driven by strong start for merchandise trade (Week_08.2018), rise of retail sales (Week_06.2018), and surge in manufacturing sector with Industrial Production Index recording 15.2% YoY growth. The outlook for merchandise trade, retail sales and manufacturing sectors is good for 2018 against the backdrop of government’s initiatives to cut business red tape, CP-TPP sign-off, and continued strong Foreign Direct Investment (FDI) inflow. (Chart of the The Week). Market Watch Vietnam stock market extended its winning streak for a fourth weekly session when energy sector lifted the index. The VNindex was on track for fourth weekly gain in a row. The Vnindex surged 26.78 points, or 2.38%, to finish weekly session at 1,150. The index has been up for four straight weeks since Tet Eve. The smart money was on rotational buying when the energy and health care sectors turned to lead the gains ahead of 1Q2018 earnings and AGM seasons. The energy sector advanced 8.74% of which notable gainers was GAS (+14.23%) while healthcare sector rose 3.78% with DHG (+8.39%) as biggest gainer. Meanwhile, the foreign investors turned to net selling position with USD 18.24mn through ETF rebalance activities.

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