Singapore fund remains bullish on Viet Nam
August 13 2019
VAHOCA is a Singapore-based asset manager with a value focus and a long term investment strategy.
Its Asia fund, focused on the Asian consumer story, has had itsmost profitable investments in Viet Nam in the last seven years.
In addition, some of the biggest investment companies from Singapore have been leading the way with strategic investments in Vietnam for more than two decades.
The chief representative of VAHOCA said: “VAHOCA is very constructive on the macro-environment that Viet Nam offers today with its 6.5-7 per cent GDP growth.
“Viet Nam seems to be on a secular growth trend. On top of that, it is on a path towards EM MSCI inclusion and is undertaking interesting steps to make the stock exchange a central piece of its structural growth.
“The benefits of such a strategy have been seen in other countries and Vietnam seems particularly well-positioned to enjoy solid growth for many years to come.”
He said VAHOCA is interested in participating in this solid growth trend and looked for a domestic story that is not focused on export.
The construction sector with a growth north of 7 per cent and companies trading far below the index multiple stood out.
This company is a sector leader and has underperformed in recent quarters and so is now trading very cheaply.
One of the key investment criteria VAHOCA focuses on is the strength of the brand. In fast growing EM economies, brand recognition is a particularly important factor.
For several years everywhere one looked in Viet Nam one saw the same companys logo, which was very impressive. A strong brand name is hard to achieve and therefore a strong asset for a company that have it.
It offers protection against inflation and price wars by competitors since clients are willing to pay a premium for a brand.
VAHOCA has a long-term investment strategy, and with a significant percentage of the equity held by the employees the benefits of a turnaround will also strongly benefit these important stakeholders.