Frontier and emerging markets (Vietnam)

Dylan Waller

Nomadic Equity

Thematic (Sector/Industry)

Industry Struggle2015 was a challenging year for Vietnam's seafood exports, resulting from the decreased costs of exports, decreased demand, and strong competition from other countries in Asia:<ul>
<li>Shrimp exports reached <a href="http://www.seafoodsource.com/all-commentary/is-vietnam-s-shrimp-industry-in-crisis" target="_blank">$3 billion by 2015</a>, representing a 1/3 decrease from 2014.</li>
<li>Pangasius exports declined by <a href="http://www.seafoodsource.com/all-commentary/vietnamese-pangasius-exports-to-continue-to-plunge" target="_blank">10% in 2015</a>, driven by a 14.3% decrease in Europe, and a 5.6% decrease in America.</li>
<li>Shrimp Farmers in the Mekong Delta faced a challenging year, as seen with the Tra Vinh Province, where 41% of…</li>
</ul>

Industry Struggle2015 was a challenging year for Vietnam's seafood exports, resulting from the decreased costs of exports, decreased demand, and strong competition from other countries in Asia:
Shrimp exports reached $3 billion by 2015, representing a 1/3 decrease from 2014.
Pangasius exports declined by 10% in 2015, driven by a 14.3% decrease in Europe, and a 5.6% decrease in America.
Shrimp Farmers in the Mekong Delta faced a challenging year, as seen with the Tra Vinh Province, where 41% of…


Vietnam officially removed the foreign ownership limitation this September, allowing foreign investors to take 100% ownership of companies.  This legislation is one of the last steps for Vietnam to successfully transition to an emerging market, yet its unclear implementation currently results in Vietnam still being a frontier market.  While the legislation has been passed, foreign investors can expect actual implementation to be an unclear, length process, determined on a case to case basis…

Vietnam officially removed the foreign ownership limitation this September, allowing foreign investors to take 100% ownership of companies.  This legislation is one of the last steps for Vietnam to successfully transition to an emerging market, yet its unclear implementation currently results in Vietnam still being a frontier market.  While the legislation has been passed, foreign investors can expect actual implementation to be an unclear, length process, determined on a case to case basis…

Vietnam's Removal of the Foreign Ownership Limitation: A Future Portfolio for Emerging Vietnam

Vietnam's economy has a flurry of advantages to offer to investors, which perhaps makes it one of the most ideal locations for investment in Asia:<ul><li>Vietnam's stock market trades at a 30-40% discount to its peers in Asia.  Funds that utilize value investing have been very successful in Vietnam.</li><li>Annual GDP growth was most recently 7%, ahead of the 2015 economic plan, which planned for 6.2% YoY growth.  <a href="http://www.smartkarma.com/insights/vietnam-going-once-going-twice" target="_blank" data-smartkarma-citation="insights:146">Vietnam: going once, going twice...</a> </li><li>Retail sales growth has averaged at 21.8% between 2002 and 2015, and YoY retail sales growth in October was <a href="http://www.tradingeconomics.com/vietnam/retail-sales-yoy" target="_blank">13%</a>.</li><li>Inflation fell to 0% in <a href="http://www.tradingeconomics.com/vietnam/inflation-cpi" target="_blank">October of 2015</a>.</li><li>Growth in Vietnam is being catalyzed by its high export growth, and its relative advantage as a site for low cost manufacturing.  Due to Vietnam’s comparatively lower wages, exports in Vietnam have <a href="http://www.tradingeconomics.com/vietnam/exports" target="_blank">doubled in the past five years</a>.</li><li> Vietnam also took a very important step in September this year by removing the foreign ownership limitation in certain industries, a step that will promote a larger flow of FDI into the country as this new law is implemented by companies.  Foreigners have been willing to pay a premium of 20% to invest in companies like Vinamilk, that are fully held by foreign investors.</li><li> Franklin Templeton has recently announced its plan to invest $3 billion into Vietnam, a large accomplishment for a country’s stock market that is substantially smaller than its peers in Asia.</li><li> China’s devaluation of its currency in August created a flurry of currency devaluations throughout Asia, yet the Vietnamese dong has held its ground relatively well, with a<a href="http://www.bloomberg.com/quote/USDVND:CUR" target="_blank"> YTD depreciation of 5.14%.</a></li><li>Demographics are favorable, as over 50% of the population is under 30 years old.</li></ul>Locally managed investment funds offer stronger advantages for individual investors, as well as institutional investors utilizing a fund of fund approach.  Vietnam Holding Ltd. and VinaCapital Vietnam Opportunity Fund, both listed on the London Stock Exchange, are two funds for individual and institutional investors to strongly consider.

Vietnam's economy has a flurry of advantages to offer to investors, which perhaps makes it one of the most ideal locations for investment in Asia:Vietnam's stock market trades at a 30-40% discount to its peers in Asia.  Funds that utilize value investing have been very successful in Vietnam.Annual GDP growth was most recently 7%, ahead of the 2015 economic plan, which planned for 6.2% YoY growth.  Vietnam: going once, going twice... Retail sales growth has averaged at 21.8% between 2002 and 2015, and YoY retail sales growth in October was 13%.Inflation fell to 0% in October of 2015.Growth in Vietnam is being catalyzed by its high export growth, and its relative advantage as a site for low cost manufacturing.  Due to Vietnam’s comparatively lower wages, exports in Vietnam have doubled in the past five years. Vietnam also took a very important step in September this year by removing the foreign ownership limitation in certain industries, a step that will promote a larger flow of FDI into the country as this new law is implemented by companies.  Foreigners have been willing to pay a premium of 20% to invest in companies like Vinamilk, that are fully held by foreign investors. Franklin Templeton has recently announced its plan to invest $3 billion into Vietnam, a large accomplishment for a country’s stock market that is substantially smaller than its peers in Asia. China’s devaluation of its currency in August created a flurry of currency devaluations throughout Asia, yet the Vietnamese dong has held its ground relatively well, with a YTD depreciation of 5.14%.Demographics are favorable, as over 50% of the population is under 30 years old.Locally managed investment funds offer stronger advantages for individual investors, as well as institutional investors utilizing a fund of fund approach.  Vietnam Holding Ltd. and VinaCapital Vietnam Opportunity Fund, both listed on the London Stock Exchange, are two funds for individual and institutional investors to strongly consider.

Vietnam Fund of Fund Approach: VinaCapital Vietnam Opportunity Fund and Vietnam Holding Ltd.

Vietnam

BIBICA Corp manufactures a wide range of confectionery products.

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Bibica Corp (BBC VN)

Vietnam's Seafood Industry Outlook

Industry Struggle2015 was a challenging year for Vietnam's seafood exports, resulting from the decreased costs of exports, decreased demand, and...

Nomadic Equity

Vietnam's Removal of the Foreign Ownership Limitation: A Future Portfolio for Emerging Vietnam

Vietnam officially removed the foreign ownership limitation this September, allowing foreign investors to take 100% ownership of companies. This...

Nomadic Equity

Vietnam Fund of Fund Approach: VinaCapital Vietnam Opportunity Fund and Vietnam Holding Ltd.

Vietnam's economy has a flurry of advantages to offer to investors, which perhaps makes it one of the most ideal locations for investment in...

Nomadic Equity

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