Week 07/08 – 11/08

acb.vn, bwe.vn, dig.vn, kdc.vn, hbc.vn, lpb.vn, stb.vn, vcg.vn, vic.vn, vjc.vn, vhm.vn

Company

ACB VN: Dragon Financial Holdings Limited sold 120.98 mn ACB shares on August 7, reducing its ownership rate from 6,9193% (268.75 mn shares) to 3,8046% (147.77 mn shares). After the transaction, Dragon Capital groups reduced its ownership rate in ACB from 8,2563% (320 mn shares) to 5,1605% (200.4 mn shares).

Comment: That’s a YUGE sell down, and we don’t see where they are putting new capital = redemptions?

BWE VN: recorded, in July, revenue of VND256 bn and PAT of VND55 bn. For 7M2023, BWE recorded revenue of VND1,992 bn (-10% YoY) and PAT of VND387 bn (-3% YoY), completing 54% of the revenue target and 46% of the profit target.

Comment: I’d compare this to TTW or EASTW (for the water business) in Thailand. Think there’s a great long term story here, but valuation is still a q mark for me at the moment.

DIG VN: has just registered to sell all of more than 3.9 mn shares, equivalent to 15.04% of shares of DIC Investment and Trading JSC for the purpose of portfolio structuring.

KDC VN: member funds under VinaCapital sold a total of nearly 9.6 mn shares, thereby reducing the group’s ownership ratio in KDC from 8.6% to 4.89%.

Comment: Similar to Dragon cap, we don’t see where they are putting new capital to work = redemptions?

HBC VN: announced Extraordinary General Meeting to be held on August 26th. As HBC plans to issue shares with a total volume of 274 mn shares at the price of VND12,000/share to increase charter capital

Comment: Ah jesus…this is the issue with Vietnam, management are NOT owners, they love issuing new equity to get cash to do stupid projects. On the flip side I do expect to see the government unleash another wave of infra spending and so the contractors are going to do well.

LPB VN: plans to pay stock dividend at the rate of 19%. The last registration date will be 23rd August and ex-dividend will be 22nd August. Also, LPB will issue preferred shares at the rate of 28.9% with the price of VND10,000/share at 23rd August.

Comment: See above. Pref shares @ 28% though…jesus…

STB VN: plans to sell 32.5% of capital at VAMC in Q4.2023 with minimum selling price about VND32,000 – VND34,000/ share according to DSC securities.

STB VN: announced the implementation of a credit package of VND30,000 bn for individual customers to further support people, stimulate production, business and consumption activities.

VCG VN: bought back two lots of bonds. In which, VCG bought back all VND120 bn of bonds code VCGH2126006 and VND80 bn out of VND220 bn of bonds code VCGH2126007.

Comment: Interesting. One of the better run “odd” companies in VN.

VIC VN: Business combination plan between VinFast Auto Pte. Ltd. and Black Spade Acquisition Co was approved by Black Spade Shareholders at the Special General Meeting. Accordingly, VinFast common shares and warrants are expected to begin trading on Nasdaq Stock Market LLC (“Nasdaq”) on, or approximately, August 15th under the new listing tickers “VFS” and “VFSWW”.

Comment: The VN market has rallied in the past month purely due to this news. Not sure why they are celebrating the owner of VIC effectively cashing out and securing his runaway money in the US.

VJC VN: has, in early August, issued 2 lots of bonds VJCH2328010 and VJCH2328009. Each bond lot is worth VND300 bn, has a term of 60 months and matures in 2028.

Comment: They’re bankrupt. Don’t fly vietjet, overuse of planes, maintenance will become a massive issue…

VHM VN: was approved the planning of 1/500 social housing projects of more than VND3.7 bn in Khanh Hoa.

Comment: Do tell me how this actually will be beneficial for shareholders…

Country

• The Ministry of Finance expects inflation of 3.2% or 3.7% this year, well below than the maximum target of 4.5%. Inflation last year was 3.15%, much lower than the average of 7.85% in Southeast Asia; developed countries reported double-digit figures.
• More companies reported delaying paying principal and interest on bonds in the second quarter, with a total outstanding payment of nearly VND24.3 tn ($1.02 bn).
• The country’s total export revenue in July reached US$29.68 bn, up 3.5% YoY. Domestic economic sectors saw a 4.2% reduction, while the foreign-invested sector, including crude oil, decreased by 3.2%.
• The disbursement of the VND120-tn credit package for social housing has been far slower than expected, with just a few applicants since its rollout over three months ago. Data from the State Bank of Vietnam (SBV) showed that only VND95 bn from the VND120-tn aid package has been disbursed since its official launch. Commercial banks have committed to lending VND950 bn to several investors of social housing projects.
• The prime minister has issued a directive requesting relevant authorities to ensure national food security while the country has a better opportunity to boost rice exports to benefit from the recent spike in global rice prices.
• Vietnam spent nearly $5 bn importing fuel in the first seven months of 2023, up 61% YoY, to ensure adequate supply as its biggest refinery Nghi Son is set to shut down for major maintenance.
• The price of material shrimp in the Mekong Delta region has dropped to its lowest level this year. In the 7M, Vietnam’s shrimp production reached an estimated 590,100 tons, a 4% increase YoY. However, exports of aquatic products from January to July brought in total revenue of US$4.95 bn, down 25.4% YoY.
• Between January and July this year, Binh Duong attracted 52.47 tn VND (2.21 bn USD) worth of domestic investment, representing an annual increase of 16.5%. So far, the province has recorded a total of 62,848 domestic enterprises with combined registered capital of 683 tn VND (28.78 bn USD).
• CPI of Vietnam was forecast to expand at around 3.2% to 3.75% this year. The Ministry of Finance predicted CPI at 3.2% to 3.7%, and the State Bank of Vietnam at 3.7% (plus or minus 0.5%). Official statistics showed that from January to July, the CPI + 3.12% YoY, and core inflation by 4.65%. CPI is on a downward trend, from 4.89% in January to 2% in June and 2.06% in July).
• Local consumption demand for gold during the 2Q reached 12.7 tonnes, marking a decrease of 9% YoY. Demand for gold bars and coins totaled 9.1 tonnes, posting an annual drop of 5%, while demand for jewelry stood at 3.7 tonnes, suffering a fall of 18%.
• The Ministry of Industry and Trade is set to levy anti-dumping and anti-subsidy duties on sugar imports from Thailand. The duties will be in effect from August 18, 2023 to June 15, 2026.
• The total revenue to the State budget between January and July exceeded VND1.01 quadrillion ($42.53 bn), equaling 62.7% of the yearly estimate and dropping by 7.8% from the same period last year.
• Vietnam Group Electricity (EVN) has been told to find solutions for 14 solar power projects that have been granted feed-in tariffs (FITs) against regulations.
• The WB’s report shows Vietnam’s economic growth rate slows from 8% in 2022 to 3.7% in 1H2023. Vietnam’s economy is expected to grow by 4.7% in 2023 and will gradually recover to 5.5% in 2024 and 6% in 2025.