1. finance
2. investing
3. stocks

January 2015
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$143m (31 Dec 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$78.8m; +162.76% since inception (31 Dec 2003)
PXP Vietnam Emerging Equity Fund: AUM of US$36.6m; +21.78 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 more sophisticated manufacturing
Sustained move to trade surpluses ahead of expectations
Resumption of privatisation programme and relaxation of foreign ownership limits pending
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 Emerging Equity Fund
• Introduction
• Performance
12
13
6. PXP Vietnam Fund
•
•
17
18
Introduction
Performance
7. Proposed Merger of PXPVF and PXPVEEF
22
8. Vietnam in a Sweet Spot
24
9. Holdings: Active v Passive
26
10. Regulatory Authorities and Affiliations
28
11. Appendices
30
12. Disclaimer
39
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: foreign direct investment, exports, domestic demand
•
2014 GDP growth of 5.96%
Future Growth Drivers
•
Higher value-add manufacturing
•
Burgeoning middle class
•
Urbanisation
4
Vietnam Macro: Economic Indicators
5
Vietnam CPI
CPI y/y
CPI m/m
4
20
3
CPI y/y %
25
15
2
10
1
5
0
CPI m/m %
30
-1
01/06 09/06 05/07 01/08 09/08 05/09 01/10 09/10 05/11 01/12 09/12 05/13 01/14 09/14
Source Bloomberg
Balance of Trade (USD bn)
2
0
-2
-4
-6
-8
-10
-12
-14
-16
-18
Vietnam GDP Growth %
9
8
2007
2008
2009
2010
2011
2012
2013
2014
7
6
5
4
3
2
1
0
2007
2008
2009
2010
2011
2012
2013
2014
2015 E
Source: World Bank and PXP Estimates
Viet Nam Index: The story so far
1400
1200
1000
800
VNM Mkt. Cap.
$4.9bn
Total 35 Stocks
PXPVF launched
Total 176 Stocks
Total 5 Stocks
Founding of PXP
Vietnam Asset
Management
600
400
303 Stocks
Mkt. Cap. $50bn
200
0
Jul 00
PXP VEEF
launched
Jul 01
Jul 02
Ho Chi Minh City
Stock Exchange
opens (2 stocks,
$35m Mkt. Cap.)
Jul 03
Jul 04
Jul 05
Jul 06 Jul 07
Vinamilk (VNM)
lists Jan 06, Mkt.
Cap. $500m (50%
of total market)
Jul 08 Jul 09
Jul 10
Jul 11
Jul 12
Jul 13
Jul 14
6
Key Policy Reforms
New era of monetary policy with key reforms driving a structural bull market
Structural Reforms
Rationalisation and
reorganisation of inefficient
state-owned enterprises
Improving Foreign Access
Monetary Policy
Change in focus promoting the
pursuit of long-term economic
stability proving timely and
effective
Foreign ownership limits
currently 30% for banks, and
49% for all other listed stocks
Delayed by legislative
requirements but is likely in 2015
Resumption of privatisation
programme of SOEs
Vietnam Asset Management
Company launched in 2013 to
lead recapitalisation of
banking sector
US$ 1.5bn social housing
stimulus package
7
Accessing the Bull Market
Relaxation of foreign limits will provide further impetus for Vietnam’s market
Closed-end
Funds
•
Open Ended
Funds
Exchange
Traded Funds
Direct Equity
Access
ETFs facilitate easy access and exit but cannot hold the higher quality stocks at 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
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 in the market
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 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
•
We prefer substance over form and have always s prioritised performance over asset gathering
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), so
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 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 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; expected to merge with PXP
Vietnam Fund on 2nd February 2015
•
Over 95% invested in Vietnam-listed equities
•
Net Assets US$ 36.6 m (31 Dec 2014)
•
Monthly subscriptions & redemptions
12
Multi-year NAV Performance
VEEF
VNI Index
USD
FTSE Vietnam
Index
VEEF
VNI Index
USD
FTSE Vietnam
Index
1 Year
12.72%
6.61%
7.36%
2014
12.72%
6.61%
7.36%
2 Years
47.18%
28.43%
23.80%
2013
30.58%
20.47%
11.21%
3 Years
83.85%
52.69%
35.88%
2012
24.91%
18.89%
13.80%
4 Years
27.63%
2.67%
-34.14%
2011
-30.58%
-32.76%
-51.53%
5 Years
7.77%
-4.68%
-44.57%
2010
-15.56%
-7.16%
-15.83%
6 Years
96.61%
41.37%
-23.45%
2009
82.43%
48.31%
38.11%
7 Years
-48.07%
-55.91%
-75.60%
2008
-73.59%
-68.81%
-68.13%
8 Years
-35.25%
-45.49%
-
2007
24.68%
23.61%
-
9 Years
21.32%
32.11%
-
2006
87.37%
142.38%
-
Inception
21.78%
25.78%
Source: PXP & Bloomberg data as at 31 Dec 2014
13
Performance
VEEF v VNI & FTSE Vietnam USD Jan 2011 - Dec 2014
VEEF v Van Eck Market Vectors & DB-X Tracker ETF Jan 2011 Dec 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 Jan-13 May-13 Sep-13 Jan-14 May-14 Sep-14
-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
VEEF Return
V.Eck VN Return
DB-X Tracker Return
Source: PXP & Bloomberg data to Dec 2014
14
NAV Performance v Peers
40%
2013 NAV Performance
16%
35%
14%
30%
12%
25%
10%
20%
8%
15%
6%
10%
4%
5%
2%
0%
2014 NAV Performance
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 31 Dec 2014
15
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%
-1.75%
Nov
-0.40%
16.38%
-3.36%
-7.40%
-14.67%
-2.66%
-8.88%
-2.47%
2.89%
-3.91%
Dec
0.78%
12.29%
-3.39%
-14.40%
1.25%
6.95%
-1.37%
9.13%
0.43%
-3.67%
Year
0.38%
87.37%
24.68%
-73.59%
82.43%
-15.56%
-30.60%
24.95%
30.57%
12.72%
Source: PXP as at 31 Dec 2014
16
PXP Vietnam Fund
The fund is expected to merge with PXP Vietnam Emerging Equity Fund on 2nd February 2015.
The following charts are for information purposes only.
10
PXP VIETNAM FUND Premium/Discount to NAV (%)
5
0
-5
-10
-15
-20
-25
-30
-35
17
Performance
Consistent outperformance from a fundamental, bottom-up, research driven approach
Multi-Year NAV Performance
Calendar NAV Performance
PXPVF *
VNI Index USD
2014
8.07%
6.61%
FTSE Vietnam
Index
7.36%
2013
38.37%
20.47%
11.21%
2012
33.70%
18.89%
13.80%
2011
-21.89%
-32.76%
-51.53%
-34.14%
2010
-17.17%
-7.16%
-15.83%
-4.68%
-44.57%
2009
76.62%
48.31%
38.11%
128.47%
41.37%
-23.45%
2008
-70.86%
-68.81%
-68.13%
7 Years
-33.43%
-55.91%
-75.60%
2007
37.95%
23.61%
-
8 Years
-8.17%
-45.49%
-
2006
149.40%
142.38%
-
9 Years
129.02%
32.11%
-
2005
20.67%
27.33%
-
10 Years
176.37%
68.22%
-
2004
-3.84%
42.15%
-
Inception
165.76%
139.12%
-
PXPVF *
VNI Index USD
FTSE Vietnam
Index
1 Year
8.07%
6.61%
7.36%
2 Years
49.54%
28.43%
23.80%
3 Years
99.94%
52.69%
35.88%
4 Years
56.18%
2.67%
5 Years
29.36%
6 Years
* Net of all fees; Cum Dec 2014 dividend
Source: PXP & Bloomberg data as at 31 Dec 2014
18
Performance
PXPVF v VNI & FTSE Vietnam in USD Feb 2011 - Dec 2014
100%
100%
80%
80%
60%
PXPVF v Van Eck Market Vectors & DB-X Tracker ETF Jan 2011 Dec 2014
60%
40%
40%
20%
20%
0%
0%
-20%
-20%
-40%
-60%
-40%
-80%
Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14 Sep-14
-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
PXPVF Return
VNI USD Return
FTSE Vietnam Return
PXPVF Return
V.Eck VN Return
DB-X Tracker Return
Source: PXP & Bloomberg data (Dec 2014);
Cum Dec 2014 dividend
19
Closed-End Funds
Peer Group NAV Performance Jan 2012 - 31 Dec 2014
120%
100%
80%
60%
40%
20%
0%
PXPVF
PXP VEEF
Vietnam
Holding
Vietnam Equity
Vietnam
Holding
Growth Fund
Vietnam
Enterprise
Investments
Limited
Vietnam
Opportunities
Fund
DB-X tracker Market Vectors
Vietnam
ETF
Vietnam ETF Infrastructure
Fund
20
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% -1.64% -4.72% -3.68%
Year
-3.84%
20.67%
149.40%
37.95%
-70.86%
76.62%
-17.17%
-21.89%
33.70%
38.37%
8.07%
Source: PXP as at 31 December 2014;
Cum Dec 2014 dividend
21
Proposed Merger of PXPVF
and PXPVEEF
•
•
•
•
•
•
•
•
•
US$ 36.6m
Open-Ended
Cayman Island Mutual Fund
Management Fee 1.5%,
Performance Fee 15% over 8%
per annum with high watermark
US$ 78.8m
Closed-End
Listed on LSE Main Market
Management Fee 2%
31st Dec 2014: Valuation Date
30st Jan: Suspension of listing of PXPVF shares
2nd Feb: 1 PXPVF share will be exchanged for
1.07883 shares of PXPVEEF
•
•
•
•
•
c. US$ 115.4m
Open-Ended
Cayman Island Mutual Fund
Management Fee 1.5%,
Performance Fee 15% over 8% per
annum with high watermark
22
Proposed Merger of
PXPVF and PXPVEEF
Top 10 Holdings Post Merger
Top 10 Holdings Pre Merger
(as at 31 December 2014)
% of net assets
(as at 31 December 2014)
% of net assets
Vinamilk (VNM)
16.5
Vinamilk (VNM)
18.7
Hoa Phat Group (HPG)
13.4
Hoa Phat Group (HPG)
10.3
HCMC Securities (HCM)
11.0
HCMC Securities (HCM)
9.3
FPT Corporation (FPT)
8.8
Sacombank (STB)
6.7
Sacombank (STB)
7.2
FPT Corporation (FPT)
6.4
PetroVietnam Drilling (PVD)
5.9
Refrigeration and Electrical
Engineering Corporation (REE)
5.3
Hoang Anh Gia Lai (HAG)
4.9
PetroVietnam Drilling (PVD)
5.1
Danang Rubber (DRC)
3.6
Hoang Anh Gia Lai (HAG)
4.4
Dong Phu Rubber (DPR)
3.6
Dong Phu Rubber (DPR)
4.3
Military Bank (MBB)
3.0
VN Direct (VND)
2.5
23
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 expected in 2015
•
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
2015 and beyond
24
Valuation
Portfolio Valuation Comparison by Weighted Average PE
25.0
20.2
PE Multiple
14.6
11.6
10.3
10.0
14.4
13.3
12.8
2014 PE
2015 PE
Viet Nam Index
13.8
12.5
SE THAI
16.6
14.1
FTSE Malay KLCI
15.8
15.3
Jakarta Comp
21.0
14.9
PSEi - Philippines
20.8
18.4
20.2
20.0
15.0
Market
13.3
10.9
9.4
9.2
Source: Bloomberg Consensus January 2015
PXP Coverage Universe Forward PE Ratios
5.0
2014E
2015E
2016E
Mkt inc financials
11.7
10.7
9.8
Mkt ex-financials
10.5
9.2
8.8
Mkt exMSN/BVH/VIC
10.7
9.8
9.1
0.0
PXPVF
VEEF
PE 2014
DB-X Tracker
PE 2015
V.Eck VN
PE 2016
Source: PXP Research January 2015
Source: PXP Research January 2015
25
Holdings: Active vs Passive
Viet Nam Index Top -10
Viet Nam
Index
VNI
DB-X Tracker
ETF
XVTD
Van Eck Market
Vectors ETF
VNM
PXP Vietnam
Fund
Vietnam
Emerging
Equity Fund
PetroVietnam Gas





Vinamilk





Masan Group





Vingroup





Vietcombank





BIDV





Bao Viet Holdings





Sacombank





VietinBank





PetroVietnam Drilling





26
Top Picks
Stock
Name
Industry
VNI Weight
PE 2014
PE 2015
VNM
Vinamilk
Consumer Staples
10.1%
15.9
13.8
HCM
HCMC Securities
Financials
0.5%
10.7
8.9
MBB
Military Bank
Financials
1.5%
5.9
5.3
PVD
PetroVietnam Drilling
Energy
2.0%
9.2
7.3
FPT
FPT Corporation
Information Technology
1.7%
10
8.6
Source: PXP Research December 2014
27
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 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
28
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
29
Appendices
30
Key Personnel
Kevin Snowball (CEO & Portfolio Manager). Co-founder in 2002
•
•
•
29 years investment experience
Portfolio manager of PXP Vietnam Fund & PXP Vietnam Emerging Equity Fund since inception
Responsible for investment policy and strategy
Nguyen Thi Hien, CFA, MBA (Head of Research). Joined Oct 2006, left Dec 2009, re-joined Oct 2014
•
•
9 years experience in finance and investment management in Vietnam
Responsible for management of PXP Equity Research Team
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
•
•
•
20 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; leads a team of 3
Preparation of daily Net Asset Value estimates
31
Investment Professionals
Strong, cohesive and stable team
Portfolios managed since inception by Kevin Snowball. PXP prides itself on its low staff turnover
Kevin Snowball
Chief Executive Officer
& Portfolio Manager
Nguyen Thi Hien, CFA, MBA
Head of Research
•
Nguyen Tam Trinh, CFA
•
Dinh Thi Van Anh
Associate Director. Joined Nov 2006
Research Manager. Joined Jan 2010
•
•
Nguyen Hoang Nam, CFA
Ngo Bich Van
Senior Investment Analyst. Joined Nov 2009
Senior Investment Analyst. Joined July 2014
• Hoang Thi Lan Anh
Investment Analyst. Joined July 2012
•
Nguyen Le Nguyen Phuong
Investment Analyst. Joined July 2012
• Nguyen Ngoc Dao Chi
Assistant Portfolio Manager. Joined Sep 2006
• Lawrence Brader
Assistant Portfolio Manager. Joined Jan 2013
•
Douglas Barnett, CAIA
Business Development. Joined Jan 2013
32
Appendix C: Vinamilk (VNM)
Sector
Consumer, Non-cyclical
Mkt Cap $m
4,662
Mkt Price VND
99,500
52 week H
126,667
52 week L
98,000
LAST UPDATE
08/12/2014
PXP Research: VNM
Foreign % owned
Performance YTD
Trailing Year
Debt/EBITDA 2012
Dividend Yield
BETA VNI
49.00
P/E 2013
-8.52
P/E 2014
-11.91
P/E 2015
-0.77
P/E 2016
3.8%
P/E 2017
0.92 EV/EBITDA 2014
15.24
15.68
13.56
11.20
9.53
11.21
140%
120%
100%
80%
60%
40%
20%
11/14
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 Dec 2014
33
Appendix C: Ho Chi Minh City Securities (HCM)
Sector
Mkt Cap $m
Mkt Price VND
52 week H
52 week L
LAST UPDATE
Financial
210
35,200
44,200
22,200
08/12/2014
PXP Research: HCM
Foreign % owned
Performance YTD
Trailing Year
Debt/EBITDA 2012
Dividend Yield
BETA VNI
49.00
P/E 2013
49.54
P/E 2014
57.92
P/E 2015
0.00
P/E 2016
4.3%
P/E 2017
1.17 EV/EBITDA 2014
15.71
10.51
8.80
7.34
N/A
N/A
350%
300%
250%
200%
150%
100%
50%
•
•
11/14
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
-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 Dec 2014
34
Appendix C: Military Bank (MBB)
Sector
Mkt Cap $m
Mkt Price VND
52 week H
52 week L
LAST UPDATE
Financial
712
13,100
16,408
12,039
08/12/2014
PXP Research: MBB
Foreign % owned
Performance YTD
Trailing Year
Debt/EBITDA 2012
Dividend Yield
BETA VNI
10.00
P/E 2013
11.79
P/E 2014
10.92
P/E 2015
0.00
P/E 2016
11.5%
P/E 2017
0.76 EV/EBITDA 2014
6.38
6.02
5.25
4.54
3.95
N/A
70%
60%
50%
40%
30%
20%
10%
•
•
•
11/14
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
-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 Dec 2014
35
Appendix C: PetroVietnam Drilling (PVD)
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
Energy
987
69,500
110,000
53,182
08/12/2014
40.39
P/E 2013
27.65
P/E 2014
25.59
P/E 2015
1.97
P/E 2016
2.1%
P/E 2017
1.12 EV/EBITDA 2014
11.18
8.28
6.63
6.31
5.87
4.95
300%
250%
200%
150%
100%
50%
•
•
•
11/14
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
-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 Dec 2014
36
Appendix C: FPT Corporation (FPT)
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
Communications
778
48,300
59,500
37,120
08/12/2014
49.00
P/E 2013
33.72
P/E 2014
31.22
P/E 2015
-0.04
P/E 2016
4.1%
P/E 2017
1.15 EV/EBITDA 2014
8.25
9.93
8.55
7.25
6.11
4.65
60%
50%
40%
30%
20%
10%
11/14
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
-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 Dec 2014
37
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
38
Appendix E: Disclaimer
The information contained in this presentation 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 to persons who are investment professionals, high net
worth companies or others who are entitled to be given the presentation under the law of the jurisdiction in which it is given (Qualified Investors). In member states of the European
Economic Area, Qualified Investors falls within the meaning of Article 2(1)(e) of the Prospectus Directive (Directive 2003/71/EC). 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 Singapore, Qualified Investors included (a) institutional investors (as defined in the
Singapore Securities and Futures Act (SFA)) pursuant to Section 304 of the SFA, (b)relevant persons (as defined in the SFA) pursuant to and in accordance with the conditions specified in
Section 305(1) of the SFA and (c) persons who acquires the Shares as principal on terms that the Shares may only be acquired at a consideration of not less than S$200,000 (or its
equivalent in a foreign currency) for each transaction pursuant to and in accordance with the conditions specified in Section 305(2) of the SFA. Pursuant to Section 305 of the SFA read in
conjunction with Regulation 32 and the Sixth Schedule to the Securities and Futures (Offers of Investments) (Collective Investment Schemes) Regulations 2005 (the “SFR”), the MAS has
been notified in relation to the offer of the Shares. In accordance with the SFA and the SFR, the Scheme has been entered into the list of restricted schemes maintained by the MAS for the
purposes of the offer of Shares made or intended to be made pursuant to Section 305 of the SFA.
It is the responsibility of every person reading this document to satisfy himself as to the full observance of laws of any relevant country, including obtaining any government or other
consent which may be required or observing any other formality which needs to be observed in that country.
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.
Nothing contained herein should be relied upon as a promise or representation as to the future. There is no obligation or responsibility to advise any person of changes in the information
set forth herein after the date hereof. None of the 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, there is no 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 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 Qualified Investors. This presentation is strictly confidential and may not be copied or distributed or passed on by any recipient. None of the company or person acting on its
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.
By 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.
39