For the six months ended 30 June 2018, VEIL’s NAV per share in GBP terms declined 1.2% from £5.22 to £5.16. NAV per share declined 3.6% in USD terms from $7.06 to $6.81, trailing the VN Index by 1.1% over the period.
The banking sector continued to deliver for VEIL as both of the fund’s top bank holdings ended the half in positive territory: Asia Commercial Bank (ACB) increased 5.0% and Military Bank (MBB) rose 4.3%. The real estate sector also performed well: Dat Xanh Group (DXG) rose 40.8% and Khang Dien House (KDH) increased 11.9%. The transportation sector did not perform well: Airport Corporation of Vietnam (ACV) declined 16.6%, while Vietjet Air (VJC) rose 15.9%.
Overall, the company has confidence in the market for the second half of the year as a result of valuations becoming attractive post-correction. According to VEIL’s forecast, its top 60 companies are expected to deliver 28% EPS growth on just 14 times forward earnings in 2018.
Wolfgang Bertelsmeier, VEIL’s Chairman, commented: “While rising uncertainty in the global economy has impacted emerging markets in general, it also has affected Vietnam’s solid fundamentals on both macro and micro levels. This concern was reflected as VEIL outperformed the VN Index in the first five months of the year but lagged the market in June. However, illustrating VEIL’s impressive longer-term track record, VEIL continued to significantly outperform the index over three years and five years by 22.4% and 26.3% respectively.”