Market reports

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.

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk09.2018

05-03-2018 09:41:17

What’s on deck in economics? Earlier-than-expected pick up in consumer-price inflation. Data published by General Statistics Office (GSO) showed consumer price inflation accelerated to 3.15% YoY, from 2.65% in January. February marked the highest level since Septermber 2017. It is attributed partly to seasonal factors, namely the changes in consumption behavior surrounding Lunar New Year. Food and foodstuff inflation spiked to 01-year high of 0.27%, ending the long contraction period since April 2017. The pick-up in inflation appeared to be earlier than our expectation (The_Vietnam StreetWise_Wk05.2018), leaving no more room to cut rate in our view. In addition, a rise in global oil prices will lead to cost-push inflationary pressures when Vietnam’s economy is heavily dependent on import. We believe to keep target inflation under 4% in 2018, the SBV may start soon tighter monetary policy.(Chart of the The Week). Market Watch Vietnam stock market extended the rally led by energy and basic material sectors. The VNindex notched its second positive week in a row since Tet holiday. The Vnindex added 18.36 points, or 1.66%, to finish weekly session at 1,121; benefiting from gains in energy and basic material sectors on the back of rotational buying. The week’s gain is not broad with only three of ten primary sectors in solidly higher. The energy sector advanced 4.94% of which notable gainers were PXS (+10.99%), PVD (+6.80%) and GAS (+5.22%) while basic material sector rose 3.31%. Meanwhile, the foreign investors were in net selling position with USD 44.22mn, marking three consecutive net selling weeks, to take profit. Despite weekly net selling, the foreigners were monthly net buying of USD 103mn in February with VRE, VIC, PLX and MWG as top buying stocks.

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk08.2018

26-02-2018 10:45:59

What’s on deck in economics? A strong start for merchandise trade. Estimates released by the General Statistics Office (GSO) showed that export rose by 32.5% YoY, to USD 19bn in January while imports surged by 46.4% YoY, reaching USD 19.3bn. The robust growth rate of export reflects continued strong momentum from riding the global trade wave. In particular, exports of phones and accessories, manufactured and distributed globally by Samsung, rose by 80.3% YoY, to USD 4.2bn. Despite the spike in export turnover, the even faster pace of import growth led to a trade deficit of USD 0.3bn, marking the widest shortfall since May 2017. Rapidly rising output from manufacturing’s sector increased demand for imports of immediate goods, particularly the import growth of manufacturing materials spiked to 65.96% YoY. We expect the Vietnam trade growth maintained strong in 2018 given that the mega-regional trade deal, now called CP-TPP, is approaching to close in March 2018 in principle. (Chart of the The Week). Market Watch Vietnam stock market kicked off the 1st week of Lunar New Year in upbeat fashion with financials and consumer non-cyclical led the gains. Vietnam stocks jolted higher after long-awaited trading sentiment in long Tet holiday and good signal from global stocks. The Vnindex notched 43.12 points, or 4.07%, to finish weekly session at 1,102, benefiting from sharp gains in financials and consumer non-cyclical sectors, two largest market capital sectors. The financial sectors advanced 6.41%, leading by BVH (+13.03%), CTG (+11.73%), VCB (+11.51%) and VIC (+6.35%) while consumer non-cyclical sectors rose 3.29%. Meanwhile, the foreign investors were in net selling position with USD 5.8mn, marking two consecutive net selling weeks, to take profit. The top selling stocks is HPG and VJC.

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk06.2018

12-02-2018 09:06:26

What’s on deck in economics? Retail Sales Continued to Rise despite slowing pace. According to data released by the General Statistics Office (GSO), the value of retail sales (at current prices) posted growth of 9.5% year on year following a 10.9% peak in December 2017, marking first six months of slowing growth. The slowing pace is attributed to mostly the trade segment. The trade segment, which account for 75.33% of all retail sales, has managed to do moderately with sales up by 7.6% (vs. 7.0% in December 2017). In contrast to slowing pace in trade segment, the tourism and hotel/restaurant segments performed very well, recording growth of 17.8% and 20.8% year on year respectively. We continue to expect Vietnam retail sector to experience robust growth on the back of: (i) rising income and favorable demographics, and (ii) government effort to reduce red tape, focusing on food retail, electricity and e-commerce managed by Ministry of Industry and Trade. Given that, foreign investors’ increasing interest in Vietnam’s retail sector is unsurprising. Market Watch VNindex clawed back 101 points of week’s steep loss. The stock market saw a surge in volatility and turmoil when margin was under pressure, coupled with bad sentiment from global stock market. The Vnindex slumped 101 points, or 9.15%, to finish weekly session at 1,003.90, posting largest weekly drops since 22 Feburary 2008. Losses on HSX bourse were broad-based with all sectors finishing with losses. The energy sector was the biggest losers, tanking 18.58% after the unsustained oil price recovery, followed by consumer non-cyclicals and financials, which all fell more than 8%. The bright side of the market may be the net-buying stance from the foreigners with total USD 181.13bn. They took use of sell-off sessions to accumulate the retail-exposed stocks, such as VRE, HDB and MWG.

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk05.2018

05-02-2018 09:29:43

What’s on deck in economics? Inflationary pressures continued to ease. According to data released by the General Statistics Office (GSO), January 2018 CPI grew by 2.65% year on year, marking the sixth consecutive month of slowing headline inflation since August 2017. Food and foodstuff price deflation, which began in April 2017, was again the main factor behind the easing of the headline figure – prices for food and foodstuffs contracted by 1.14% in January 2018, following a 1.80% fall in December 2017. In other words, the food and foodstuff dragged 0.44% CPI down at contribution component level. We believe the food prices will start to pick up from April 2018 as base effects begin to drop out the headline figures. In addition, a forecast pick-up in global oil prices will lead to cost-push inflationary pressures. Market Watch VNindex logged first down week of 2018 as major sectors dropped. The stock market retreated from positive territory amid end-month margin pressures. The selling forces built up throughout the week when the market sentiment took a break before Lunar New Year. The Vnindex fell 10.06 points, or 0.95%, to 1105, marking first down week of 2018. Losses on HSX bourse were broad-based with seven of nine main sectors finishing with losses. We believe it like a correction when market had been overextended and right now is a perfect time for a pullback. The foreign investors remained net-buyers albeit decreasing size of USD 1.73mn with VIC, MWG and SSI as top buying stocks. It suggested the investors rush in the Vietnam economy powered by consumers.

TVS Weekly NewsBrief - The Vietnam Streetwise - Wk.04.2018

29-01-2018 09:49:41

What’s on deck in economics? 2018 credit growth targeted to 17%. The State Bank of Vietnam (SBV) announced that the estimated 2017 credit growth was c.18.2%, down slightly from 18.25% in 2016. It also set the 2018 credit growth target of 17%. Partly, the robust rate of credit growth fueled the surging economic growth to a ten-year high of 6.8% in 2017. We believe, however, the factor will be difficult to sustain when 2018 expected inflation remains under pressure. In addition, many trouble banks are still wary of extending credit because of the still-high level of non-performing loans in the industry. The current ratio of NPL, SML and NPL sold to VAMC was c.7.91% in 2017 Market Watch VNindex steamed up after two-day trading halt; and energy, technology and financials sectors led the gains. The stock market was heading into its most exciting week of the new year after two-day trading halt occurred due to technical software issues. The Vnindex surged 53.57 points, or 5.04%, to 1115.6, booking a fourth straight weekly advance. A spate of upbeat earnings coupled with an equity rush fueled the market. The energy sector was particular outperformer, jumping 6.24% owa on the back of oil price rebound while technology and financial sectors were up 5.81% and 4.84% respectively. The foreign investors remained net-buyers totaling USD 73mn with HDB, VIC and MSN as top buying stocks. It suggested the investors rush in the Vietnam economy powered by consumers.

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