4th Sep 2020 10:34
(Alliance News) - Vietnam Enterprise Investments Ltd on Friday posted a drop in its net asset value per share for the first half of 2020 due to the effects of Covid-19, but remained positive going ahead thanks to Vietnam's handling of the virus.
The closed-end fund focused on investing in Vietnamese equities posted a NAV per share for the half year ended June 30 of USD5.85, down 14% from USD6.76 at the end of the second half of 2019. NAV per share in British pound terms was down 7.2% to GBP4.73 from GBP5.10 the half prior.
Vietnam Enterprise Investments put drop in NAV per share down to the "macroeconomic backdrop" to the Covid-19 pandemic.
Chair Stanley Chou said: "In terms of our results, Vietnam Enterprise Investments outperformed the VN Index by 0.3% in the first half of the year. Despite the performance proximity to the VN Index, our holdings are actually quite different from the VN Index, and still retain potential upside value."
The materials sector was Vietnam Enterprise Investments' star performer in the first half as steel producer Hoa Phat Group delivered a very respectable gain of 14% amidst the market meltdown.
Retailers such as Mobile World Group and Phu Nhuan Jewelry were hit hardest following the announcement of a three week social distancing period which started in early April. Mobile World closed down 29% and Phu Nhuan Jewelry's stock fell 32%.
The company swung to a pretax loss of USD200.5 million, down from a profit of USD3.2 million a year prior.
Vietnam Enterprise Investments did not declare a dividend, same as the year prior.
Going forward, the company said that Vietnam's effective response to Covid-19 provides a good backdrop for the equity market to perform well in the next six to twelve months.
"The playbook for investing in both global and Vietnam equities this year has been anything but conventional. The ever shifting markets and sentiment make it a challenging landscape for investors to predict what the next six months of the year will look like," the company said.
Vietnam Enterprise Investments added: "The current weakness in the stock market is a great opportunity to pick future winners and the next market leaders. Together with its research team, Vietnam Enterprise Investments has been screening its portfolio, as well as its investment universe, for companies that are not only expected to survive the pandemic but will thrive after it."
Vietnam Enterprise Investments plans to evolve its portfolio to meet the post-virus landscape, ensuring it "best captures" the resurgence of Vietnam's economy in this context.
Vietnam Enterprise Investments shares were up 1.3% at 431.48 pence each on Friday morning in London.
By Greg Roxburgh; [email protected]
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