Vietnam Holding: Still More Upside in Vietnam Yet

Why It Matters

Vietnam Holding’s disciplined strategy and Vietnam’s macro reforms together promise higher returns and lower discount risk, while the FTSE upgrade could unlock a wave of new capital into the market.

Key Takeaways

• NAV rose 10.8% and share price up 12.6% H1.
• Growth driven by macro reforms and disciplined stock selection.
• Vietnam’s resilience stems from large, adaptable population and trade deals.
• Fund uses buybacks and redemption facility to narrow NAV discount.
• FTSE reclassification expected to boost visibility and capital inflows.

Summary

Vietnam Holding reported a strong first‑half performance, with net asset value up 10.8% and its London‑listed shares gaining 12.6%. In an interview, Dynam Capital chairman Craig Martin attributed the gains to a blend of Vietnam’s robust macro environment—driven by modernization, foreign direct investment and ambitious GDP targets—and the fund’s disciplined stock‑picking and portfolio construction. The fund highlighted several levers behind its outperformance: a focus on companies that can compound earnings faster than the economy, rigorous ESG scoring, and active capital‑management tools such as share buybacks and an annual redemption facility that have narrowed the discount to NAV to a record‑low 6%. Martin stressed that while the broader Vietnam index outperformed at times, Vietnam Holding’s selective approach aims for sustainable, risk‑adjusted growth rather than chasing short‑term market leaders. Martin offered vivid analogies, noting that “valuation is like the first tee on a round of golf” and emphasizing the fund’s 20‑year track record and early adoption of responsible‑investing principles. He also pointed to the imminent FTSE Russell reclassification of Vietnam from a frontier to an emerging market as a catalyst that will broaden passive and active investor access, potentially lifting company valuations. The discussion underscores that Vietnam’s demographic depth, trade‑deal agility and ongoing reforms position it to avoid the middle‑income trap, while improved market infrastructure and capital‑raising avenues will be critical for financing infrastructure, renewable energy and the country’s net‑zero ambitions. For investors, the fund’s alignment tools and Vietnam’s macro tailwinds suggest continued upside potential and reduced discount risk.

Original Description

Vietnam Holding’s interim results showed solid NAV and share price progress, supported by disciplined stock selection, resilient Vietnamese macro fundamentals, and active discount management. The discussion focuses on how the fund is positioning for Vietnam’s next growth phase, while using redemptions and buybacks to reinforce shareholder alignment.