This Vietnam stock market report is a summary guide to the major news, performance details, and discussion of other factors influencing the Vietnam stock market in April 2023.
VIETNAM STOCK MARKET NEWS TODAY april 2023
The Vietnam stock market fell 1.5% in April. It was a month where generally emerging markets unperformed a rising US stock market, so with that backdrop perhaps the fall in Vietnam stocks was not surprising.
The month was a busy one in terms of Vietnam companies reporting their results. This highlighted the differences between various sectors of the market. Clearly, we have a slowdown in economic growth from major global trading partners the US and Europe which is affecting Vietnam exporters. This stood out in certain Q1 numbers released, whereas companies more exposed to Vietnam’s domestic spend are experiencing better trends.
The government being aware of such slowing global growth trends, and still being worried about the nervousness in Vietnam’s corporate bond and property markets, were not standing still. Various taxation relief measures, and also support for debt markets were announced.
VIETNAM STOCK INDEX LEVEL CLOSE APRIL 2023
The VN Index fell 1.5% in April, to close the month at 1,049 points. Compared to the last 12 months, Vietnam stocks were noticeably less volatile in terms of the general direction of the VN Index.
VIETNAM ETF PERFORMANCE COMPARISON APRIL 2023
In USD NAV terms here is the performance of these US listed Vietnam ETFs – The VanEck Vietnam ETF (VNM) eased 0.4% April, whereas The Global X MSCI Vietnam ETF (VNAM) fell 0.8%.
In VND NAV terms, Vietnam listed ETF The Dragon Capital VFMVN Diamond ETF (FUEVFVND:HOSE) eased 0.3% Refer below for an explanation of all the Vietnam ETFs out there.
VIETNAM ETF LIST 2023
Below is a complete up to date list of Vietnam ETFs in 2023.
VIETNAM STOCK MARKET CHART 12 MONTHS TO APRIL 2023
Source: investing.com
VIETNAM LATEST ECONOMIC DATA APRIL 2023
Vietnam’s manufacturing PMI weakened to 46.7 for March. Significant declines seen in both exports and imports not so surpsiing given the weaker global economic backdrop I highlighted earlier.
Also as touched on earlier the domestic side of the economy is faring better. In April this was highlighted by the release retail sales figures showing +11.5% yoy.
YOY inflation figures came in below 3%, a figure many central banks across the world would be pleased to see in their own countries.
VIETNAM ECONOMIC OUTLOOK 2023
Asia Frontier Capital Vietnam Fund’s report noted that the likes of tax relief, interest rate cuts and economic stimulus should see Vietnam as one of the bright spots of ASEAN and the world in terms of economic growth.
Note the recent 2023 GDP forecasts below:
Source: via Asia Frontier Capital
WHAT IS THE STOCK MARKET FORECAST FOR VIETNAM?
Whilst further down I will refer to a current P/E ratio of circa 13 times that you often see widely quoted, I wish to highlight that the earnings trajectory is quite supportive for the market.
The below tables are from Dragon Capital to the end of March and note how forward P/Es are very low, implying overall that Vietnam companies next couple of years of earnings are expected to be solid.
In fact, we are effectively looking at forward P/Es around the cheapest ever witnessed in Vietnam.
Source: Dragon Capital
WHAT IS THE P/E RATIO OF THE VIETNAM STOCK MARKET?
According to Simply Wall St, at the time of writing this April Vietnam stock market update, the P/E Ratio of the VN-Index is 13.7 times.
BEST VIETNAM FUNDS / STOCKBROKER COMMENTS APRIL 2023
VN Direct, which is who I ended up opening an account with, highlighted MIG, a fast-growing mid cap life insurer.
It is consistent with some of the reflections I make in other parts of this month’s blog post. That is, it highlights strong EPS growth FY22-25, doing better in the higher interest rate environment, and the sort of stock that is less exposed to weaker global growth when compared with other parts of the Vietnam stock market. VN Direct is talking about EPS growth of circa 20% for these years and this stock happened to be a strong performer in April.
WHICH WAS THE BEST STOCK TO BUY FROM VIETNAM JUST BEFORE APRIL 2023?
TP Bank jumped an impressive 7% in a month where the VN-Index was in the red. It’s market cap is a lot smaller than the main handful or so of banks that make up a big component of the VN-Index but would have been a good one to own in April.
TP Bank’s aim is to have its core strategy of sticking to being a retail-oriented bank. It wants to capitalize on being an early mover in the digital banking space in Vietnam, where it can record strong lending growth with good and simple processes. In that context I am not so surprised the shares have had good gains last month and 2023 in general. Simpler domestic bank stories in robust economies probably sound good amidst the news of big global bank disasters in the US and Europe.
WHAT HAPPENED WITH THE VIETNAM STOCK MARKET IN APRIL 2023 SECTOR WISE?
Although Vietnam recently cut interest rates, somewhat of a rare occurrence globally, higher interest rates generally in recent times has assisted insurance sector stocks.
The general trend in earnings for this sector reported strong growth when releasing their figures in April for the first quarter.
ON THE GROUND NEWS AND THOUGHT SNIPPETS FROM VIETNAM FROM STEVE
I actually bought a Vietnam direct holding recently, Dragon Capital’s Vietnam “Diamond ETF”. I shall add it to the Vietnam themed Sharesight portfolio that I have been tracking here:
SHARESIGHT PORTFOLIO TRACKER REVIEW 2022 – VIETNAM STOCK MARKET (vietnamesestockmarket.com)
I have discussed it previously in my ETF lists and reviews, noting how it is a Vietnam only listed ETF, that specializes in owning the Vietnam companies where the foreign ownership limits get full. So for a foreigner like myself, it can be a way to get exposure to stocks that are not as easy to access directly or via other Vietnam funds.
Glancing at the top few holdings, I noticed it owns the likes of FPT Corporation, Mobile World Group, and PNJ Jewlery. In fact, these 3 stocks total over 40% of the ETF, which suit me. They look well placed to ride what should be a sustainable positive Vietnam consumer story, and good value.
ARE EMERGING MARKETS A BUY IN 2023?
Since I assume many readers of this blog might have an interest in other equity markets that are either considered frontier / emerging, I will occasionally provide relevant links to Seeking Alpha articles of mine.
I believe that non-members to Seeking Alpha have access to a certain amount of articles per month they can read for free. So hopefully the entire article is available and useful to some. If not, well Seeking Alpha allows me to make short exerts here so I can do that in some instances.
Below is a link with my recent thoughts last month the Thailand stock market as the country approaches an election..
Summary
Emerging Market stocks look cheap in general, although Thai stocks are not particularly cheap versus their historical valuation range.
Investors rationally are acknowledging the strong tourism rebound for Thailand. The country in recent years also has been relatively stable politically and doing ok keeping inflation in check.
The global economic backdrop is worrying however, Thai stocks could come under pressure as their exports slow.
If Thai stocks drift lower, the iShares MSCI Thailand ETF could be a good way to play a tourism rebound. For now, some other alternative emerging markets look more attractive.
iShares MSCI Thailand ETF overview and performance
The iShares MSCI Thailand ETF (NYSEARCA:THD) has a reasonable enough management expense ratio, AUMs and liquidity to consider as a way to get exposure to Thai equities.
This ETF is approximately $350 million in size, with an expense ratio of 0.58%. It was launched in 2008 and tracks the MSCI Thailand IMI 25/50 Index. This index spans large, mid and small sections of the Thailand market. There are over 130 constituents, and it covers approximately 99% of the free float-adjusted market capitalization in Thailand.
This means your exposure is quite diversified across companies. The ETF holds more than 130 stocks, and the largest weight to an individual position is about 6%. Sectors wise it also has plenty of diversification, with the largest weight being approximately 13% in the energy sector.
To continue reading click here..
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Thanks for reading again, for the basics on how to invest in the Vietnam stock market check out the below link if you have not done so already.
HOW TO INVEST IN THE VIETNAM STOCK MARKET
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