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Bargain prices greet potential stock-buyers
Following its relentless fall, the stock market has become cheap and offers good buying opportunities, fund managers told a meeting held at the HCM City Stock Exchange last Sunday to discuss the market situation.
The VN-Index, after falling for so long, was now available at an average PE (price to earning ratio) of around 15, managers from 11 local and foreign fund management companies, including the Viet Fund Management Company (VFM), VinaCapital, Indochina Capital, Phanxipang (PXP) and Vietcapital, said.
Tran Thanh Tan, general director of VFM which manages around VND6 trillion (US$375 million), said the opportunity was very promising.
His company was sitting on VND1.4 trillion in cash, including over VND800 billion from a newly closed fund, ready for investment, he said, adding it had invested tens of billions of dong last week.
He said: "This is a rare opportunity because it’s a long and complex process to invest five to 10 billion dong in companies’ public offerings. Putting that amount in listed blue-chip firms is much simpler."
But delegates advised investors to carefully analyse securities before investing since the low index did not mean all shares were cheap.
The HCM City Stock Exchange’s general director Tran Dac Sinh noted that funds had been net buyers in recent days.
Andy Ho, managing director of VinaCapital, said VinaCapital’s funds were trading higher than their NAV (net asset value) on the London Stock Exchange’s Alternative Investment Market, showing foreign investors’ confidence in the Vietnamese market.
Tran Le Khanh, investment director of Prudential Vietnam Fund Management Company, said his company planned to raised a further $500 million to increase the funds under its management to $2 billion.
Other funds, however, did not disclose their investment plans at the meeting.
Participants said the market woes had been caused mainly by its lack of maturity and high inflation, but added the large number of IPOs and fresh issues by listed companies too had contributed. They suggested a slowing of the pace.
VNS
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