VietNam Holding Limited
27 July 2026
VietNam Holding Limited ("VNH" or the "Company")
Monthly Investor Report
A report detailing the activities of the Company for the month of June 2026 has been issued by Dynam Capital Limited, the investment manager of the Company. Electronic copies of the report have been made available to shareholders on the Company's website and a summary of the report is included below.
Manager Commentary: Price and prejudice
June presented investors with something of a conundrum - a widening gap between price and perception. On the one hand, the evidence supporting Vietnam's long-term investment case continues to build. Economic growth remains among the strongest in Asia, exports continue to expand, consumers are spending, foreign manufacturers are investing at record levels and company earnings are expected to deliver another quarter of robust double-digit growth. On the other hand, many of Vietnam's highest-quality listed companies continue to trade on valuations more commonly associated with periods of economic uncertainty than strong economic growth.
International institutions have increasingly recognised the country's progress. From July 1st, the World Bank reclassified Vietnam as an "Upper Middle Income" economy, reflecting the country's remarkable economic transformation over the past two decades. More recently, the IMF revised its 2026 growth forecast for Vietnam upwards to 7.5%, citing stronger-than-expected technology exports and resilient domestic demand, even as it became more cautious on parts of the global economy. Standard Chartered Bank forecast a much higher 9.5% growth for the year. Together with Vietnam's forthcoming promotion to FTSE Russell Secondary Emerging Market status in September, these developments point to growing international recognition of Vietnam's economic transformation, even if public equity markets have yet to fully reflect it.
The latest economic data only adds to that picture. GDP growth accelerated to 8.2% in the second quarter, exports rose 21.0% in the first half of the year and retail sales increased by almost 14.8% in June. Registered foreign direct investment reached a record US$34.7 bn, while manufacturing activity remained firmly in expansion territory. The trade figures also deserve a little more attention than the headlines might suggest. Imports continue to outpace exports, resulting in a wider trade deficit, but much of that increase reflects machinery, electronic components and production inputs being brought into the country by foreign manufacturers. Those are the building blocks of future production. Vietnam's growing exports of computers, electronics and mobile phones increasingly reflect investments that were made months, and often years, earlier.
There is another interesting contrast. While foreign direct investment continues to break records, foreign portfolio investors have remained net sellers of Vietnamese equities. Companies investing in new manufacturing capacity and expanding supply chains are making long-term commitments to Vietnam's future, while many equity investors continue to focus on shorter-term concerns around geopolitics, global capital flows and market sentiment. That divergence goes a long way towards explaining why valuations remain so subdued despite such strong economic fundamentals.
There are also signs that the backdrop may be becoming more supportive. Inflation eased during June as lower oil prices fed through into consumer prices, helping improve the outlook for interest rates. At the same time, second-quarter earnings are expected to show growth of around 18-20%, suggesting that the underlying performance of many businesses remains firmly intact.
All of which brings us back to the conundrum. The VNH portfolio now trades on around 10 times forward earnings, with our ten largest holdings closer to 8.5 times, despite expected earnings growth of around 20%. It is not often that businesses delivering this level of earnings growth are valued at levels associated with far weaker economic conditions. Overall, June itself was relatively quiet, with the Fund's NAV declining by 0.3% as markets largely moved sideways ahead of the reporting season. Our investment approach, however, remains consistent. We continue to favour companies with strong balance sheets, clear earnings visibility and structural growth opportunities, while maintaining our gradual shift towards larger, more liquid businesses as Vietnam's capital markets continue to mature.
The conundrum, therefore, is not whether Vietnam's economy continues to move forward. The evidence increasingly speaks for itself. Rather, it is why so much of that progress has yet to be reflected in market valuations.
Experience tells us that economies and markets do not always move in step. For long-term investors, those moments when perception and fundamentals diverge can often provide the most compelling opportunities.
For more information please contact:
Dynam Capital Limited
Craig Martin Tel: +84 28 3827 7590
info@dynamcapital.com |www.dynamcapital.com
Cavendish Capital Markets Limited
Corporate Broker and Financial Advisor Tel: +44 20 7220 0500
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