Currencies and contagion

Sharp weakness in many emerging market currencies in the past few months has brought back the old fear of contagion to smaller equity markets globally. To us this is a valid point.

PVT - Result Update on PetroVietnam Transportation Corp JSC

Not only the positive general business, the divestment story in 2019-2020 is also a good news for stock price. Based on the target price of VND 21,200 per share and the expected cash dividend of VND 700 per share, generating a total return of 26.2%, compared to the closing price on Sep 6^th 2018, we recommend BUY the stock

Insurance: New Trend in M&A - Accelerating to Transformation and Innovation

The recent research conducted on 200 insurance executives by KPMG International titled “Accelerated evolution: M&A, transformation and innovation in the insurance industry”, has confirmed the changes in M&A and cooperation in the last few years in the industry.

Banking credit growth in 1H and 2H2018

SBV’s affirmation for the absence of additional credit limits in second half of the year will not have significant impacts on banks. Those with high credit growth in the first six months have their own plans to cope with the instruction by shifting their loan book structure towards higher profit segments, through which slowdown credit expansion.

Nevertheless, we hold the view that the banks’ efforts to refrain their lending might create adverse effects if too many banks are shifting towards the high profit retail segments. This will in turn intensifies competition in these segments and squeeze the opportunities for NIM improvement.

Update on the Vietnam Bond Market

There may be some issues with the Vietnamese government bond issuance plan which can’t seem to fulfill the initial 2018 target. While the primary market is quiet, there is a remarkable foreign net outflow in the secondary market. Yields have surged in recent months.

CTD & HBC – Business Update

The two leading firms in the construction industry experienced decent revenue growth in 1H2018 but their profit growth rate has slowed down because of important changes in the industry. Both saw their gross profit margins decrease while new jobs seem to be abundant for reputable contractors.

NKG - Result Update on Nam Kim Steel JSC

Rong Viet Securities Corporation hereby presents the Result Update on Nam Kim Steel JSC (HSX: NKG) with the overall opinion as follows:

VCB - Business Update

VCB’s PBT reached more than VND 8 Tn (+52.6% YoY) in 1H 2018, the highest growth observed since 2009. The positive results came from faster growth in incomes and slower growth in operating and provision expenses.

Currencies: the Real

The world has been focussed on the Turkish Lira of late, for good reasons, but what is going on with the Brazilian Real (BRL)?

Noteworthy Recent Acquisition Offer in Pharma in Vietnam

Our calculation shows that the DMC deal is done at 12.2x EV/EBITDA in 2016, while DHG deals are completed at 8.9x EV/EBITDA in 2016 and 17.6x EV/EBITDA in 2018.

Real estate update in District 7, Ho Chi Minh City

Overview

Statistical Update on Industrial Zones

Jones Lang LaSalle has released its update on the current status of industrial hubs across Vietnam. Most industrial zones are operated by several longstanding names such as: Sonadezi, Becamex, Viglacera, IDICO and KBC. These developers possess a huge land bank across the country. The research compared statistically land area as well as industries operated between regions. The northern region is a reasonable destination for companies that shift their manufacturing out of China. The region has a relatively developed infrastructure, thus making transportation from China affordable. Warehouse leasing activity is interesting due to steady demand from hi-tech enterprises and logistics firms who need a large area for stocking. The asking rent is around USD4.1/sqm/month, 30% higher than that of the southern region.