Bright prospects seen for banking, securities, real estate, retail stocks next year: broker

Banking, securities, real estate and retail stocks have the potential to do well in 2025, says Dao Hong Duong, director of sectors and stock analysis with VPBank Securities (VPBankS).

Sharing his insights at the Vietnam Investment Forum 2025 in Ho Chi Minh City last Friday, Duong said he chose the banking stock group because of its growth rate in scale, credit and expectations for recovery of the real estate industry.

The fact that banks account for a high proportion in the capitalization structure, at 37-46%, is also an investment argument, given a positive assessment of the general market outlook in the coming year, Duong said.

In terms of valuation, banking stocks are trading at a P/B (price to book ratio) lower than the 10-year average, which is attractive. The reason why bank stocks are trading at low valuations is partly due to concerns about asset quality, he said.

However, the VPBankS expert noted that concerns about asset quality have been reflected in valuations, so when the general business environment improves, the banking industry can be seen to have good growth prospects for next year.

The second industry that has drawn a positive assessment is securities, although capitalization of this industry is relatively small within the general structure of the market.

Although liquidity of the securities industry has decreased at times, profits have still increased steadily. In choosing securities stocks, apart from the quality of the securities company's assets, investors should check the quality of its risk management, he said.

"If we look to 2025, when liquidity on the Ho Chi Minh Stock Exchange will only reach about VND16,000 billion ($632.4 million), the profit margin of the securities industry will increase very strongly. This could be the break-even point, offsetting fixed costs of brokerage activities. Therefore, I think the securities industry has very promising prospects," said Duong.

The fourth industry group mentioned by the expert – real estate – had shown negative data for the first nine months of 2024 with decreasing profits, creating a very low base level. However, there are encouraging signs: inventories have begun to increase and enterprises are redeploying projects and selling units. While there might not be a major overall change, the real estate industry will certainly see a good recovery in 2025, he noted.

Duong said that he saw two main growth drivers for retail stocks next year: recovery in consumption of essential goods; and increased spending on non-essential goods. Retail industry profits are poised for continued recovery, lasting at least two consecutive years.