20160118_BSC_Vietnam Sector Outlook_EN_2016_Part1_Public

Five notable investment topics in 2015: we gave 5 investment topics in 2015 and they had a strong impact on VN- Index for the year. Moreover, most of our recommended stocks outperforned Vn-index in 2015.

• First, the recovery of macro economy was more evitable and the finance sectors benefited from this trend. At year end, Banking sector increased by 12.1% (VCB, BID), Insurance increased by 51.23% (BIC, BMI)

• Second, real estate recovered with rising liquidity. This led to opportunities for dowstream sectors such as construction, materials, and furnitures. The strongest growth belonged to enterprises located in the South, thanks to the boost in civil investment and the FTAs. At year end 2015, investors who followed this topic may gain profit from the BSC’s recommended stocks or leading stocks of the sectors such as Construction (CTD, HBC), Real estate (VIC, DXG), Materials (BMP, NTP), Ciment (HT1, BCC), Brick (CVT, VSC, VIT)...

• Third, energy price fell and electricity price increased, leading to an improvement in earnings of sectors such as transportation, automobile, fertilizer, thermal, chemical, ... due to the low input prices; In 2015, our recommended stocks also had good growth in the Chemicals sector (PLC), Electricity (NT2), Fertilisers (DPM); transportation (GSP), ...

• Fourth, the expansionary monetary policy of ECB and the JCB caused depreciation in JPY and EUR. BSC’s assessment was relatively accurate for this trend, although enterprises with large EUR loans such as HT1, BCC, BTS and NT2 only recognized exchange rate gain in Q1 / 2015, and recorded losses in the remaining quarters. Considering all of 2015, these businesses have been recorded foreign exchange rate gains (HT1 and NT2 recorded strong growth in 2015)

• Fifth, the Free Trade Agreements (FTAs), in which ACFTA effective in Jan 1st 2015 negatively affected the pharmaceutical and steel sectors, stock price movements for these sectors were not positive in 2015. Meanwhile, our most expected sectors such as Logistics (GMD), ports (VSC, HAH), and industrial (KBC, LHG) offered strong growth. Textile, a sector expected by investors, did not yield significant growth.