October 2014
October 2014
Summary
Locally based, pure Vietnam focused investment manager
•
•
•
Co-founded in 2002 and majority-controlled by Kevin Snowball
First equity specialist investment manager in Vietnam, with total AUM US$159m (30 Sep 2014)
23 staff including 11 investment professionals
10-year record of benchmark outperformance
•
•
•
Multi-year track record of index and peer group outperformance
Flagship fund PXP Vietnam Fund: AUM of US$88.3m; +199.7% since inception (31 Dec 2003)
Vietnam Emerging Equity Fund: AUM of US$42.2m; +35.3% since inception (3 Nov 2005)
Proven investment strategy
•
•
•
•
Targeting the highest quality Vietnamese companies for superior long term capital appreciation
Managed with the highest standards of professional integrity
Fundamental, bottom-up, research-driven approach
Broad coverage of Vietnamese listed equities
Favourable macro environment
•
•
•
•
•
•
•
Refocused monetary policy since 2011 targets sustainable economic progress
Inflation at 10-year low
Most stable currency in Asia for past 2 years
Move up value chain driven by value-add manufacturing
First trade surplus for 20 years in 2012, driven by growth in exports
Reforms driving a structural bull market
Resumption of privatisation programme and relaxation of foreign ownership limits
2
Index
1. Summary
2
2. Vietnam Macro
4
3. Access to the Stock Market
8
4. PXP Vietnam Asset Management
9
5. PXP Vietnam Fund
•
•
Introduction
Performance
12
13
6. Vietnam Emerging Equity Fund
• Introduction
• Performance
17
18
7. Vietnam in a Sweet Spot
22
8. Holdings: Active v Passive
24
9. Regulatory Authorities and Affiliations
26
10. Appendices
28
11. Disclaimer
37
Vietnam Macro: Introduction
Demographics
•
Population c. 90 million
•
60% < 35 years old
•
Literacy rate > 95%
•
Urban population 35%
Growth Drivers
•
Primary exports: Garments & footwear; crude oil; electronics; rice (global #1); coffee
(global #2); natural rubber (global #3)
•
Economic drivers: exports, domestic demand, foreign direct investment
•
2013 GDP of USD 171 billion (+5.4% y/y)
Future Growth Drivers
•
Higher value-add manufacturing
•
Burgeoning middle class
•
Urbanisation
4
Vietnam Macro: Economic Indicators
5
Vietnam CPI – y/y v m/m
VND/USD Since 2011 Devaluation
CPI y/y
CPI m/m
25
21,000
20
3
20,500
15
2
20,000
10
1
19,500
5
0
CPI y/y %
21,500
19,000
Jan 11
Jun 11
Nov 11
Apr 12
Sep 12
Feb 13
Jul 13
Dec 13
May 14
4
CPI m/m %
30
22,000
-1
01/06 08/06 03/07 10/07 05/08 12/08 07/09 02/10 09/10 04/11 11/11 06/12 01/13 08/13 03/14
Source Bloomberg
Balance of Trade (USD bn)
Vietnam GDP Growth %
2
9
0
8
-2
7
-4
6
-6
5
-8
4
-10
3
-12
2
-14
1
-16
0
-18
2007
2008
2009
2010
2011
2012
2013
2014 YTD
Sep 2014
2007
2008
2009
2010
2011
2012
2013
2014 E
Source: World Bank and PXP Estimate
Viet Nam Index: The story so far
1400
1200
1000
800
600
VNM Mkt. Cap.
$5.6bn
Total 35 Stocks
PXPVF launched
Total 176 Stocks
Total 5 Stocks
Founding of PXP
Vietnam Asset
Management
400
200
VEEF launched
304 Stocks
Mkt. Cap. $50bn
0
Jul 00 Jul 01 Jul 02 Jul 03 Jul 04 Jul 05 Jul 06 Jul 07 Jul 08 Jul 09 Jul 10 Jul 11 Jul 12 Jul 13 Jul 14
Ho Chi Minh City
Stock Exchange
opens (2 stocks,
$35m Mkt. Cap.)
Vinamilk (VNM)
lists Jan 06, Mkt.
Cap. $500m (50%
of total market)
6
Key Policy Reforms
New era of monetary policy with key reforms driving a structural bull market
Structural Reforms
Rationalisation and
reorganisation of inefficient
state-owned enterprises
Improving Foreign Access
Monetary Policy
Change in focus promoting the
pursuit of long-term economic
stability proving timely and
effective
Foreign ownership limits
currently 30% for banks, and
49% for all other listed stocks
Proposals under consideration
to increase limits to 60% for
non-sensitive sectors and 49%
for banks
Resumption of privatisation
programme of SOEs
Vietnam Asset Management
Company launched in 2013 to
lead recapitalisation of
banking sector
US$ 1.5bn social housing
stimulus package
7
Accessing the Bull Market
Anticipated relaxation of foreign limits promises new impetus for Vietnam’s market
Closed-end
Funds
•
Open Ended
Funds
Exchange
Traded Funds
Direct Equity
Access
ETFs allow easy market entry and exit but cannot hold the higher quality stocks which have
reached the foreign ownership limit and performance has suffered accordingly
•
Direct equity access is problematic due to the cumbersome application process and low quality
of sell-side research with limited stock coverage
PXPVF and PXP VEEF facilitate access to the market through closed and open-ended
structures respectively
Both have market-leading track records and approximately 50% of their assets in
stocks at the foreign ownership limit
8
PXP Vietnam Asset Management
Background
•
Vietnam’s first listed equity specialist investment manager, established in 2002
•
23 Staff including 11 investment professionals, all based in Ho Chi Minh City
•
Broadest coverage of Vietnamese listed equities on either the buy- or sell-side
Vision
PXP was established with a clear goal to create a Vietnam focused listed equity specialist investment
manager, dedicated to achieving superior long term returns and managed to the highest
professional standards
Approach
•
PXP applies a fundamental, bottom-up, research-driven approach combined with the active
stock selection and allocation skills of the portfolio managers in order to achieve superior longterm returns
•
We believe that stocks are increasingly trading on fundamentals and positive alpha is becoming
a function of market reach, market knowledge and local on-the-ground expertise
•
We aim to build portfolios of the highest quality companies for the long-term
•
We do not allow market noise to over-ride our fundamental views on stocks
9
PXP Vietnam Asset Management
Process
•
Idea generation across the investment team; daily research meetings provide a forum for
origination and ongoing debate
•
We conduct extensive industry and company research and seek to build long term
relationships with both potential and existing portfolio companies
•
We actively engage with over 100 companies, covering over 90% of the market capitalisation
of the Ho Chi Minh and Hanoi stock exchanges combined
Corporate Governance
•
Corporate governance standards vary widely in the Vietnamese market (as everywhere)
•
We actively manage our portfolios to target the highest quality companies for the long-term.
To the extent that we discover companies which we believe are likely to behave in a manner
detrimental to the interests of minority shareholders, we are able to mitigate these risks
through our investment process
10
Process
Research Analysts
Idea Generation
Portfolio Managers
Daily Morning Meetings
Meet Management Team
Portfolio construction
Company & Industry
Research
Continuous Monitoring
Active Management
Estimate Earnings
PXP Coverage list > 100 Stocks
Liquidity Management
Fund
Holdings
Company Valuation
Periodic Review of Exit Possibilities
Recommendation
11
PXP Vietnam Fund
Objective
To seek long-term capital appreciation of its assets by investing in a portfolio of the
equity securities of Vietnamese companies, whether established with domestic or
foreign ownership
•
London main market listed closed end fund (Ticker: VNF LN )
•
Launched in December 2003, managed since inception by Kevin Snowball
•
Multi-year track record of index outperformance achieved without leverage
•
100% invested in Vietnam-listed equities
•
Net Assets US$ 88.3 m (30 Sep 2014)
•
No performance fee
12
Performance
Consistent outperformance from a fundamental, bottom-up, research driven approach
Multi-Year NAV Performance
Calendar NAV Performance
PXPVF *
VNI Index USD
YTD
19.73%
17.94%
FTSE Vietnam
Index
17.67%
39.05%
2013
38.37%
20.47%
11.21%
37.53%
11.06%
2012
33.70%
18.89%
13.80%
72.03%
20.97%
-22.37%
2011
-21.89%
-32.76%
-51.53%
5 Years
22.13%
-13.29%
-48.50%
2010
-17.17%
-7.16%
-15.83%
6 Years
73.73%
2.62%
-46.75%
2009
76.62%
48.31%
38.11%
7 Years
-31.80%
-56.62%
-76.18%
2008
-70.86%
-68.81%
-68.13%
8 Years
46.17%
-13.94%
-
2007
37.95%
23.61%
-
9 Years
177.88%
55.11%
-
2006
149.40%
142.38%
-
10 Years
207.22
90.75%
-
2005
20.67%
27.33%
-
Inception
194.44%
164.54%
-
2004
-3.84%
42.15%
-
PXPVF *
VNI Index USD
FTSE Vietnam
Index
1 Year
25.89%
21.04%
23.49%
2 Years
79.67%
49.97%
3 Years
111.10%
4 Years
* Net of all fees
Source: PXP & Bloomberg data as at 30 September 2014
13
Performance
PXPVF v VNI & FTSE Vietnam in USD Feb 2011 - Sep 2014
100%
100%
80%
80%
60%
PXPVF v Van Eck Market Vectors & DB-X Tracker ETF Jan 2011 Sep 2014
60%
40%
40%
20%
20%
0%
0%
-20%
-20%
-40%
-60%
-40%
-80%
-60%
Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14 Sep-14
Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14 Sep-14
PXPVF Return
VNI USD Return
FTSE Vietnam Return
PXPVF Return
V.Eck VN Return
DB-X Tracker Return
Source: PXP & Bloomberg data (Sep 2014)
14
Closed-End Funds
PXPVF offers closed-end market access
40%
2012 NAV Performance
40%
2013 NAV Performance
35%
35%
30%
30%
25%
25%
20%
20%
15%
15%
10%
10%
5%
5%
0%
0%
PXPVF VN Index
VGF
DWSVF
VEIL
VNH
VOF
VEH
PXPVF VN Index
VGF
DWSVF
VEIL
•
Actively managed
•
Consistent outperformance of PXP Vietnam Fund versus market peers and index
•
PXP Vietnam Fund fully invested in listed equities, other funds less focused
VNH
VOF
VEH
15
Monthly NAV Performance Since Inception
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Jan
-0.52%
-1.66%
3.79%
38.89%
-10.01%
-2.13%
-2.71%
-0.24%
6.26%
13.41%
10.15%
PXP Vietnam Fund monthly net asset value performance since inception (USD)
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
2.77%
2.31% -3.29% -1.62% -0.68% -2.51% -1.00% 0.46% -0.38% -1.34% 2.08%
0.47%
1.94% -0.70% -0.62% 0.96% -0.46% 2.21%
7.95%
4.95%
5.07% -0.68%
22.05% 24.52% 10.69% -7.07% -1.38% -11.37% 15.00% 6.45% -0.62% 23.70% 16.86%
13.17% -3.68% -12.31% 15.05% -6.42% -11.13% 4.77% 12.08% 1.40% -5.42% -3.57%
-22.08% -23.82% 0.62% -21.83% -10.30% 5.98% 27.24% -16.48% -23.04% -7.73% -3.36%
-15.35% 8.39% 18.61% 21.67% 9.50%
9.65% 18.92% 12.03% 0.68% -15.79% 0.51%
0.20%
1.00%
6.49% -6.63% -4.20% -2.62% -8.46% -0.35% -4.00% -2.70% 6.43%
-14.99% -1.88% -1.10% -7.46% 2.69% -0.27% 7.35% -2.11% -1.52% -4.22% 1.03%
13.96% 2.41%
8.57% -4.45% -2.13% 0.69% -1.42% -1.35% 1.71% -1.63% 8.39%
-1.59% 5.65%
1.07%
9.69% -5.17% 1.89% -2.21% 6.54%
1.28%
3.75%
0.07%
5.76%
2.95% -4.73% -4.21% 1.04%
4.62%
5.34% -1.75%
Year
-3.84%
20.67%
149.40%
37.95%
-70.86%
76.62%
-17.17%
-21.89%
33.70%
38.37%
19.73%
Source: PXP as at 29 August 2014
16
Vietnam Emerging Equity Fund
Objective
To seek long-term capital appreciation of its assets by investing in a portfolio of the
equity securities of Vietnamese companies, whether established with domestic or
foreign ownership
•
Cayman Islands Mutual Fund
•
Launched on 3 November 2005, managed since inception by Kevin Snowball
•
Multi-year track record of index outperformance achieved without leverage
•
Converted from a closed end to an open-ended fund in January 2010
•
Merged with Vietnam Lotus Fund December 2010
•
Over 95% invested in Vietnam-listed equities
•
Net Assets US$ 41.1 m (30 Sep 2014)
•
Monthly subscriptions & redemptions
17
Multi-year NAV Performance
VEEF
VNI Index
USD
FTSE Vietnam
Index
VEEF
VNI Index
USD
FTSE Vietnam
Index
1 Year
30.92%
21.04%
23.49%
YTD
23.94%
17.94%
17.67%
2 Years
73.27%
49.97%
39.05%
2013
30.58%
20.47%
11.21%
3 Years
75.03%
37.53%
11.06%
2012
24.91%
18.89%
13.80%
4 Years
39.16%
20.97%
-22.37%
2011
-30.58%
-32.76%
-51.53%
5 Years
3.05%
-13.29%
-48.50%
2010
-15.56%
-7.16%
-15.83%
6 Years
41.75%
2.62%
-46.75%
2009
82.43%
48.31%
38.11%
7 Years
-46.04%
-56.62%
-76.18%
2008
-73.59%
-68.81%
-68.13%
8 Years
-6.73%
-13.94%
-
2007
24.68%
23.61%
-
Inception
33.90%
39.15%
-
2006
87.37%
142.38%
-
Source: PXP & Bloomberg data as at 30 Sep 2014
18
Performance
VEEF v VNI & FTSE Vietnam USD Jan 2011 - Sep 2014
VEEF v VNI & FTSE Vietnam USD Jan 2011 - Sep 2014
60%
60%
40%
40%
20%
20%
0%
0%
-20%
-20%
-40%
-40%
-60%
Jan-11 May-11 Sep-11
Jan-12 May-12 Sep-12
VEEF Return
Jan-13 May-13 Sep-13
Jan-14 May-14 Sep-14
VNI USD Return
FTSE Vietnam Return
-60%
Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14 Sep-14
VEEF Return
VNI USD Return
FTSE Vietnam Return
Source: PXP & Bloomberg data to 30 Sep 2014
19
NAV Performance v Peers
40%
2013 NAV Performance
35%
35%
2014 YTD NAV Performance
30%
30%
25%
25%
20%
20%
15%
15%
10%
10%
5%
5%
0%
0%
PXP VEEF
PXP VEEF
(Lead Series) (Series 1A)
VN Index
V.Eck VN
DB-X
PXP VEEF
PXP VEEF
(Lead Series) (Series 1A)
VN Index
V.Eck VN
DB-X
As at 29 Aug 2014
20
Multi-year Performance
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Jan
Feb
1.71%
26.67%
-10.13%
-1.52%
-1.12%
-0.13%
7.40%
12.06%
9.03%
13.32%
8.16%
-22.07%
-13.41%
-0.95%
-15.76%
14.12%
-2.03%
5.42%
VEEF monthly net asset value performance since inception (USD)
Mar
Apr
May
Jun
Jul
Aug
Sep
12.12%
-0.97%
-25.84%
8.25%
3.51%
-1.69%
2.05%
4.05%
4.93%
4.59%
-8.81%
0.00%
17.56%
7.14%
-0.48%
10.29%
0.59%
-2.98%
-1.81%
9.76%
-19.64%
21.30%
-7.28%
-7.41%
-5.26%
5.93%
-3.21%
-0.72%
-4.93%
-11.94%
11.48%
-5.25%
2.92%
-3.70%
-4.41%
1.63%
-5.28%
-9.25%
3.69%
9.81%
-1.08%
-0.75%
0.19%
1.47%
3.75%
8.84%
2.28%
25.09%
16.81%
-10.28%
4.95%
-3.86%
-0.59%
4.87%
5.28%
10.12%
-15.49%
11.44%
0.54%
-1.87%
-3.74%
5.31%
-1.03%
Oct
0.25%
1.21%
-17.28%
0.65%
-4.74%
-3.69%
0.60%
2.23%
Nov
-0.40%
16.38%
-3.36%
-7.40%
-14.67%
-2.66%
-8.88%
-2.47%
2.89%
Dec
0.78%
12.29%
-3.39%
-14.40%
1.25%
6.95%
-1.37%
9.13%
0.43%
Year
0.38%
87.37%
24.68%
-73.59%
82.43%
-15.56%
-30.60%
24.95%
30.57%
23.94%
Source: PXP as at 30 Sep 2014
21
Vietnam in a Sweet Spot
A switch in monetary policy in 2011 from ‘growth above everything’ to the pursuit of
long-term economic stability heralded a new era providing a compelling case for further
gains in 2014 and beyond
•
A benign and improving macroeconomic environment
•
Anticipated relaxation of foreign ownership limits
•
Ongoing recapitalisation of the banking sector and rationalisation of SOEs
•
Formation of domestic institutions to diversify investment base
•
Resumption of privatisation process to provide greater breadth to stock market
More access at close to
the low-end of the
historic trading range to
more (and bigger) stocks
A broader
market
More
scale
More interest
encouraging
further inflows
More upside in
2014 and beyond
22
Valuation
Portfolio Valuation Comparison by Weighted Average PE
20.0
16.7
16.0
PE Multiple
12.0
2014 PE
2015 PE
Viet Nam Index
14.3
13.3
SE THAI
15.8
13.5
FTSE Malay KLCI
16.4
14.9
Jakarta Comp
16.0
13.6
PSEi - Philippines
19.7
16.0
18.4
18.0
14.0
Market
14.8
13.9
13.6
13.0
12.7
12.7
10.9
10.8
9.4
10.0
9.3
Source: Bloomberg Consensus as at 10 Oct 2014
8.0
PXP Coverage Universe Forward PE Ratios
6.0
4.0
2.0
2014E
2015E
2016E
Mkt inc financials
14.8
12.0
11.0
Mkt ex-financials
15.4
13.6
11.2
Mkt exMSN/BVH/VIC
14.1
12.0
10.4
0.0
PXPVF
VEEF
PE 2014
DB-X Tracker
PE 2015
V.Eck VN
PE 2016
Source: PXP Research as at Sep 2014
Source: PXP Research as at 10 Oct 2014
23
Holdings: Active vs Passive
By our definition, active management incorporates a multitude of fundamental and governance
considerations whereas ETFs consider mainly size, liquidity and availability to foreign investors
Viet Nam Index Top -10
Viet Nam
Index
VNI
DB-X Tracker
ETF
XVTD
Van Eck Market
Vectors ETF
VNM
PXP Vietnam
Fund
PetroVietnam Gas
Vinamilk
Masan Group
Vingroup
Vietcombank
BIDV
Bao Viet Holdings
Sacombank
VietinBank
PetroVietnam Drilling
24
Top Picks
Stock
Name
Industry
VNI Weight
PE 2014
PE 2015
VNM
Vinamilk
Consumer Staples
10.2%
16.0
13.9
HCM
HCMC Securities
Financials
0.5%
13.3
12.3
MBB
Military Bank
Financials
1.6%
6.2
5.6
PVD
PetroVietnam Drilling
Energy
2.7%
12.2
9.7
FPT
FPT Corporation
Information Technology
1.7%
9.2
7.4
Source: PXP Research as at 10 Oct 2014
25
Strong Governance
Regulatory Authorities and Affiliations
•
PXP Vietnam Asset Management is licensed by the BVI Financial Services Commission (FSC) and
is a member of the Alternative Investment Management Association (AIMA)
•
Our Representative Office in Ho Chi Minh City is licensed & regulated by the State Securities
Commission (SSC) of Vietnam
•
PXP Vietnam Fund complies with the UK Listing Rules & the Disclosure and Transparency Rules
issued by the UK Financial Conduct Authority, and the Corporate Governance Code issued by the
UK Financial Reporting Council
•
Vietnam Emerging Equity Fund is regulated by the Cayman Islands Monetary Authority (CIMA)
Transparency
•
Publication of daily NAV estimates
•
All historic Offering Documents, Annual & Interim Reports and Newsletters are freely available at
www.pxpam.com
26
Operational Risk Management
Day to day Operational Control
Places orders
Authorised
Trader
Provides daily cash &
position reports
Emails trade
details
Brokers
Notifies
result
Emails trade
confirmation
External
Reconciliation
Back office
•Trade
Reconciliations
•Data Input into PMS
Uploads
trade details
Custodian and
Administrator
27
Appendices
28
Key Personnel
Kevin Snowball (CEO & Portfolio Manager). Co-founder in 2002
•
•
•
29 years investment experience
Portfolio manager of PXP Vietnam Fund & Vietnam Emerging Equity Fund since inception
Responsible for investment policy and strategy
Nguyen Ngoc Dao Chi (Acting Head of Research). Joined Sep 2006
•
•
10 years experience in finance and investment management
Responsible for all non-financial sector research
John Gavin (CFO & Compliance Officer). Joined Aug 2008
•
•
17 years with PwC including nine in Vietnam
Responsible for financial reporting, internal controls and compliance
Joelle Daumas-Snowball (COO, Legal Counsel & MLRO). Joined Oct 2006
•
•
•
18 years experience in international commercial, corporate and financial law
Extensive experience of Vietnam’s regulatory framework
Responsible for all legal matters
Hoang Hong Hanh (Head of Back Office). Joined Sep 2007
•
•
•
Promoted to Head of Back Office in 2011
Responsible for all Back Office activities
Preparation of daily Net Asset Value estimates
29
Investment Professionals
Strong, cohesive and stable team
Low staff turnover & portfolios managed since inception by Kevin Snowball
Kevin Snowball
Chief Executive Officer
& Portfolio Manager
Nguyen Ngoc Dao Chi
(Acting Head of Research)
•
Nguyen Tam Trinh, CFA
•
Mai Thi Phuong Thao
Associate Director. Joined Nov 2006
Associate Director. Joined Oct 2008
• Nguyen Hoang Nam, CFA
•
Senior Investment Analyst. Joined Nov 2009
Research Manager. Joined Jan 2010
• Ngo Bich Van
• Nguyen Le Nguyen Phuong
• Douglas Barnett, CAIA
Investment Analyst. Joined July 2012
Business Development. Joined Jan 2013
Senior Investment Analyst. Joined July 2014
Dinh Thi Van Anh
• Lawrence Brader
Assistant Portfolio Manager. Joined Jan 2013
• Hoang Thi Lan Anh
Investment Analyst. Joined July 2012
30
Appendix C: Vinamilk (VNM)
PXP Research: VNM
Sector
Consumer, Non-cyclical
Foreign % owned
Mkt Cap $m
5,087
Performance YTD
Mkt Price VND
108,000
Trailing Year
52 week H
126,667
Debt/EBITDA 2012
52 week L
99,167
Dividend Yield
LAST UPDATE
15/10/2014
BETA VNI
49.00
P/E 2013
-2.54
P/E 2014
-6.81
P/E 2015
-0.77
P/E 2016
3.5% EV/EBITDA 2013
0.95 EV/EBITDA 2014
16.54
15.77
13.72
11.18
12.58
11.53
140%
120%
100%
80%
60%
40%
20%
09/14
07/14
05/14
03/14
01/14
11/13
09/13
07/13
05/13
03/13
01/13
11/12
09/12
07/12
05/12
03/12
-20%
01/12
0%
-40%
•
•
•
•
•
Dominates the dairy market in Vietnam with 50% liquid milk market share in 2012, 75% in condensed milk, 90% in yoghurt
Net Profit CAGR of 43% over the last 5 years
2 new factories (powdered milk Apr 2013 & liquid milk September 2013) with leading technology and automation
Strong balance sheet and cash generation with limited capex. in coming years, promising higher dividend
Largest holding in PXPVF
Source: PXP Research Oct 2014
31
Financial
231
38,500
44,200
18,000
15/10/2014
49.00
P/E 2013
61.43
P/E 2014
114.02
P/E 2015
-5.49
P/E 2016
3.9% EV/EBITDA 2013
1.19 EV/EBITDA 2014
11/13
Sector
Mkt Cap $m
Mkt Price VND
52 week H
52 week L
LAST UPDATE
PXP Research: HCM
Foreign % owned
Performance YTD
Trailing Year
Debt/EBITDA 2012
Dividend Yield
BETA VNI
03/13
Appendix C: Ho Chi Minh City Securities (HCM)
17.18
12.97
12.00
10.28
N/A
N/A
350%
300%
250%
200%
150%
100%
50%
•
•
09/14
07/14
05/14
03/14
01/14
09/13
07/13
05/13
01/13
11/12
09/12
07/12
05/12
03/12
-50%
01/12
0%
Leading broker in Vietnam with 12% market share in HCMC and 8.4% market share in Hanoi
Will be a major beneficiary of relaxation of foreign ownership limits
Source: PXP Research Oct 2014
32
Financial
753
13,800
16,408
12,039
15/10/2014
10.00
P/E 2013
13.54
P/E 2014
12.36
P/E 2015
0.00
P/E 2016
10.9% EV/EBITDA 2013
0.78 EV/EBITDA 2014
11/13
Sector
Mkt Cap $m
Mkt Price VND
52 week H
52 week L
LAST UPDATE
PXP Research: MBB
Foreign % owned
Performance YTD
Trailing Year
Debt/EBITDA 2012
Dividend Yield
BETA VNI
03/13
Appendix C: Military Bank (MBB)
6.52
6.32
5.70
4.94
N/A
N/A
70%
60%
50%
40%
30%
20%
10%
•
•
•
09/14
07/14
05/14
03/14
01/14
09/13
07/13
05/13
01/13
11/12
09/12
07/12
05/12
03/12
-10%
01/12
0%
Retail and corporate banking services
One of the top 5 banks in Vietnam
Compelling valuation at 0.8x book value, 2014 P/E of 6.8x and ROE 21%
Source: PXP Research Oct 2014
33
Energy
1,370
96,000
110,000
51,653
15/10/2014
42.45
P/E 2013
73.57
P/E 2014
74.99
P/E 2015
1.97
P/E 2016
1.6% EV/EBITDA 2013
1.01 EV/EBITDA 2014
11/13
Sector
Mkt Cap $m
Mkt Price VND
52 week H
52 week L
LAST UPDATE
PXP Research: PVD
Foreign % owned
Performance YTD
Trailing Year
Debt/EBITDA 2012
Dividend Yield
BETA VNI
03/13
Appendix C: PetroVietnam Drilling (PVD)
15.45
11.44
9.16
8.71
9.31
6.77
300%
250%
200%
150%
100%
50%
•
•
•
09/14
07/14
05/14
03/14
01/14
09/13
07/13
05/13
01/13
11/12
09/12
07/12
05/12
03/12
-50%
01/12
0%
PetroVietnam subsidiary provides drilling services, drilling-related services and trading services
Strong operating cash flow, focus on core business and good management team
50% market share in Vietnam
Source: PXP Research Oct 2014
34
Communications
835
64,000
65,000
35,600
28/02/2014
49.00
P/E 2013
35.88
P/E 2014
78.64
P/E 2015
-0.04
P/E 2016
3.1% EV/EBITDA 2013
0.93 EV/EBITDA 2014
11/13
Sector
Mkt Cap $m
Mkt Price VND
52 week H
52 week L
LAST UPDATE
PXP Research: FPT
Foreign % owned
Performance YTD
Trailing Year
Debt/EBITDA 2012
Dividend Yield
BETA VNI
03/13
Appendix C: FPT Corporation (FPT)
10.93
8.29
6.91
5.69
6.35
4.01
60%
50%
40%
30%
20%
10%
09/14
07/14
05/14
03/14
01/14
09/13
07/13
05/13
01/13
11/12
09/12
07/12
05/12
03/12
-10%
01/12
0%
-20%
-30%
-40%
•
•
•
FPT is primarily an IT and system integration service provider
Also operates ISP and content hosting, mobile telephony and hardware distribution businesses
Market leader in IT, stable growth story, strong balance sheet, good cash-flow
Source: PXP Research Oct 2014
35
Appendix D: Contacts
Kevin Snowball
John Gavin
Chief Executive Officer
Chief Financial Officer
Email: KHSnowball@pxpam.com
Phone: (848) 3827 6040
Mobile: (84) 918 299 980
Email: JGavin@pxpam.com
Phone: (848) 3827 6040
Mobile: (84) 903 973 100
Lawrence Brader
Douglas Barnett
Assistant Portfolio Manager
Business Development
Email: LBrader@pxpam.com
Phone: (848) 3827 6040
Mobile: (84) 909 697 318
Email: DBarnett@pxpam.com
Phone: (848) 3827 6040
Mobile: (84) 902 682 197
36
Appendix E: Disclaimer
This document has been prepared by and is the sole responsibility of the directors (the "Directors") of PXP Vietnam Fund Limited (the “Company"), and has been prepared solely in connection with
a presentation to be held in connection with the proposed placing, open offer and firm placing of C Shares in the capital of the Company to trading on the Main market of London Stock Exchange plc
(the "Offering"). Some of the information in this document is still in draft form and has not been legally verified and will only be finalised in the final admission document or a prospectus relating to
the Offering. This document is not an admission document or prospectus and investors should not subscribe for or purchase any shares referred to in this document except on the basis of
information in the final admission document or prospectus to be published by the Company in due course. The information set out herein is subject to updating, completion, revision, verification
and amendment, and such information may change materially.
This document does not and is not intended to constitute, and should not be construed as, an offer, inducement, invitation or commitment to purchase, subscribe to, provide or sell any securities,
services or products of the Company in any jurisdiction, or any part of any solicitation of any such offer, inducement, invitation or commitment, or to provide any recommendations for financial,
securities, investment or other advice or to take any decision. You are encouraged to seek individual advice from your personal, financial, legal, tax and other advisers before making any investment
or financial decisions subscribing for or purchasing any securities.
Neither the Directors nor [Jefferies International Limited] acting as financial adviser and broker to the Company (the “Financial Adviser") nor any of their respective directors, officers, employees,
agents, affiliates or representatives or advisers or any other person makes any representation or warranty, express or implied, as to the accuracy or completeness of the information or opinions
contained in this presentation. Nothing contained herein should be relied upon as a promise or representation as to the future. None of the Company, the Financial Adviser, or their respective
members, directors, officers, employees, agents, affiliates or representatives or advisers nor any other person accepts any obligation or responsibility to advise any person of changes in the
information set forth herein after the date hereof. The Financial Adviser, which is authorised and regulated in the UK by the Financial Conduct Authority, is acting for the Company in respect of the
Offering and for no one else and will not be responsible to anyone other than the Company for providing the protections afforded to clients of the Financial Adviser nor for providing advice in
relation to the Offering or any other matter referred to herein. Further, the Financial Adviser has not authorised the contents of, or any part of, this presentation. To the fullest extent permitted by
law, none of the Company nor the Financial Adviser (nor their respective members, directors, officers, employees, agents or representatives) nor any other person accepts any liability whatsoever
for any errors, omissions or inaccuracies in such information or opinions or for any loss, cost or damage suffered or incurred howsoever arising, directly or indirectly, from any use of this
presentation or its contents or otherwise in connection with the subject matter of this presentation or any transaction. The information contained in this document is not to be relied upon for any
purpose whatsoever.
Certain statements in this presentation may be forward looking statements. By their nature, forward looking statements involve a number of risks, uncertainties and assumptions about the
Company and investments that could cause actual results or events to differ materially from those expressed or implied by the forward looking statements. Forward looking statements contained in
this presentation regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Except as required by applicable law or
regulation, neither the Company nor the Financial Adviser (nor their respective members, directors, officers, employees, agents or representatives) undertakes any obligation to update or revise
any forward looking statements, whether as a result of new information, future events or otherwise. You should not rely on forward looking statements, which speak only as of the date of this
presentation.
The information contained in this Presentation in respect of the Company and communicated during any delivery of the presentation, including the talks given by the presenters, any question and
answer session and any document or material distributed at or in connection with the presentation are only being made, supplied or directed at persons in member states of the European
Economic Area who are “qualified investors ”within the meaning of Article 2(1)(e) of the Prospectus Directive (Directive 2003/71/EC) (“Qualified Investor”). In addition, in the United Kingdom, this
document is limited to and intended for distribution only to persons who (i) are qualified investors (within the meaning of the Prospectus Directive 2003/71/EC) and (ii) who have professional
experience in matters relating to investments who fall within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order
2005 (the "FPO") and/or to high net worth bodies corporate, unincorporated associations and partnerships and trustees of high value trusts as described in Article 49(2)(a) to (d) of the FPO or to
those persons to whom it may otherwise be lawfully communicated (in each case referred to as “UK Relevant Persons”) (together, Qualified Investor and UK Relevant Persons to be referred to as
"Relevant Persons"). This document has not been approved by the Financial Adviser for the purposes of Section 21 of the Financial Services and Markets Act 2000 ("FSMA").
37
Appendix E: Disclaimer
The information contained in this presentation is not intended to be viewed by, or distributed or passed on (directly or indirectly) to, and should not be acted upon by any class of persons other
than Relevant Persons.
None of the Company nor the Financial Adviser, nor any adviser or person acting on their behalf, shall (without prejudice to any liability for fraudulent misrepresentation) have any liability
whatsoever for loss however arising, directly or indirectly, from the use of information or opinions communicated in relation to this presentation. Any investment or investment activity to which
this communication relates is available only to Relevant Persons and will be engaged only with Relevant Persons.
This document may contain unpublished price sensitive information with regard to the Company and/or its securities. Recipients of this document should not deal or encourage any other any
other person to deal in the securities of the Company whilst they remain in possession of such unpublished price sensitive information and until the transaction described in this document is
announced. Dealing in securities of the Company when in possession of unpublished price sensitive information could result in liability under the insider dealing restrictions set out in the
Criminal Justice Act 1993 or market abuse provisions of FSMA. This document may contain information which is not generally available, but which, if available, would or would be likely to be
regarded as relevant when deciding the terms on which transactions in the shares of the Company should be effected. Unreasonable behaviour based on such information could result in liability
under the market abuse provisions of FSMA.
This document is strictly confidential and is being provided to you solely for your information and for use at a presentation to be held in connection with the Offering by the Company and may
not be reproduced in any form or further distributed to any other person or published in whole or in part, for any purpose. You shall treat and safeguard as private and confidential all
information contained in this document and take all reasonable steps to preserve such confidentiality. Any failure to comply with these restrictions may constitute a violation of applicable
securities laws. This document is not for publication, release or distribution, directly or indirectly, and may not be taken or transmitted, in or into the United States, Canada, Japan, the Republic
of South Africa or Australia and may not be copied, forwarded, distributed or transmitted in or into the United States, Canada, Japan, the Republic of South Africa or Australia or any other
jurisdiction where to do so would be unlawful. The distribution of this document in any other jurisdictions may be restricted by law and persons into whose possession this document comes
should inform themselves about, and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of the laws of the United States, Canada, Japan, the
Republic of South Africa or Australia or any other such jurisdiction. By accepting this document, you agree to be bound by these restrictions.
The securities referred to in this presentation have not been and will not be registered under the US Securities Act of 1933, as amended, (the ‘‘US Securities Act’’) or under the US Investment
Company Act of 1940, as amended (the “Investment Company Act”) or under any securities laws of any state or other jurisdiction of the United States and may not be offered, sold, resold, taken
up, exercised, renounced, transferred or delivered, directly or indirectly, within the United States or to, or for the account or benefit of, any person with a registered address in, or who is
resident or ordinarily resident in, or a citizen of, the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act.
There will be no public offer of the securities in the United States. The securities referred to in this presentation may be offered (i) outside of the United States to persons who are not US
Persons in ‘‘offshore transactions’’ as such terms are defined in, and in reliance on Regulation S promulgated under the US Securities Act; and (ii) in the United States to a limited number of
‘‘qualified institutional buyers’’ as defined in Rule 144A promulgated under the US Securities Act who are “qualified purchasers” as defined in Section 2(a)(51) of the Investment Company Act, in
reliance on one or more exemptions from, or in a transaction not subject to, the registration requirements of the US Securities Act and applicable state securities laws. Neither the US Securities
and Exchange Commission nor any securities regulatory body of any state or other jurisdiction of the United States of America, nor any securities regulatory body of any other country or political
subdivision thereof, has approved or disapproved of this document or the securities discussed herein or passed on or endorsed the merits of the Offering or the accuracy or adequacy of the
contents of this document. Any representation to the contrary is a criminal offence in the United States.
The securities will also not be registered under the applicable securities laws of Canada, Japan, the Republic of South Africa or Australia and, subject to certain exemptions, may not be offered,
sold, taken up, exercised, resold, renounced, transferred or delivered, directly or indirectly, within such jurisdictions except pursuant to an applicable exemption from and in compliance with any
applicable securities laws.
By attending this presentation and/or accepting a copy of this document, you agree to be bound by the foregoing limitations and, in particular, will be taken to have represented, warranted and
undertaken that you have read and agree to comply with the contents of this notice including without limitation the obligation to keep this document and its contents confidential.
38
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