Vietnam's fast growth charms investors amid global uncertainties: VinaCapital

Fast economic growth amidst global uncertainties has been touted at VinaCapital's investor conference as Vietnam's primary attractiveness.

“It’s been three years since we were last able to host an in-person investor conference, and as we all know, the world has changed greatly since then. But one thing that hasn’t changed is Vietnam’s attractiveness for investment,” VinaCapital CEO and founding partner Don Lam told reporters on Thursday.

“Few countries have emerged from the global pandemic as strong as Vietnam has, and we are excited for our guests to see and hear that the opportunities for investing here are as abundant as ever,” he added.

VinaCapital Group, one of Vietnam’s leading investment management companies, is organizing a three-day conference to show investors why they should embrace the Southeast Asian country.

About 100 corporate and individual investors, both domestic and international, are attending the event on October 5-7 in Ho Chi Minh City.

The investment group said it forecast Vietnam’s 2022 GDP growth at 8%, driven by the country’s strong manufacturing and exports. However, its prediction for 2023 is about 6% due to slower domestic consumption and slower export and manufacturing growth.

Briefing reporters, VinaCapital chief investment officer Andy Ho said many listed companies in Vietnam as well as private enterprises in the market were operating efficiently thanks to the market’s post-pandemic strong recovery.

“The companies we invest in, particularly those in the consumer discretionary sector, are generating solid earnings, some well-above pre-Covid levels, and with the continued strength of the economy, we are confident these companies are well-positioned to continue to grow and generate solid returns for our investors in the long term.”

VinaCapital funds have ranked as the top performers in their categories in Vietnam, an outstanding achievement given the stock market’s volatility and global economic headwinds, said Brook Taylor, CEO, VinaCapital Asset Management.

“Once again, we are able to showcase the full range of investment vehicles VinaCapital offers investors, foreign or Vietnamese, institutional or retail, and enable them to participate in this dynamic country’s continued economic growth,” he said.

Nguyen Dieu Phuong, in charge of private equity (PE) investment at VinaCapital, said her group had recently received many inquiries on this type of investment in Vietnam, with healthcare, education, and retail getting more interest.

“We already have about $250 million PE flows in the pipeline for potential projects in Vietnam,” she said.

As for Vietnam’s stock market, VinaCapital securities investment head Nguyen Hoai Thu said foreign investors still considered it a frontier market, meaning that it holds more risks than an emerging market. Therefore, risk-off withdrawals have recently come as a result of the U.S. Federal Reserve’s interest rate hikes and global uncertainties. However, long-term investors expect to gain profit because by and large, market value in the Vietnamese market is still low.

She added the commodity markets in Indonesia and Thailand may lure parts of the withdrawals in the absence of such a market in Vietnam.

Thu recommended that long-term Vietnam investors should put money into such sectors as high-tech, industrial real estate, seaport and logistics, banking, and residential real estate. However, the last two sectors may hold more risks than the others.

The VinaCapital investor conference features a variety of speakers representing a wide range of industries and sectors, from tech startups to established industrial companies. They are from the Ho Chi Minh Stock Exchange, Bain & Company, Intel, Lego Group, Heineken, EDF Renewables, COP Vietnam, Bechtel Corp., JERA, ERM, Vinh Hoan JSC, Timo, VNPay, and FPT Information System.

The three-day event includes presentations from senior executives from various companies like Digiworld, VietJet Air, Hung Thinh Land, ZaloPay, Tiki, Homebase, and Realbox/FINA. The participants also have the opportunity to visit the Saigon Hi-Tech Park, FPT Software Company, and join a tour highlighting HCMC’s urban transformation.

Vietnam’s economic growth of 8.83% year-on-year in the first nine months is the highest recorded in 12 years. The figure for the same period in 2021 and 2020 - both pandemic years, was 1.42% and 2.12%, respectively. The economy expanded 2.58% last year.

On Wednesday, Singapore’s United Overseas Bank (UOB) revised up its 2022 growth forecast for Vietnam to 8.2% from the previous 7%.