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Vietnam could be region’s ‘brightest star’ in 2022; market growth likely led by banks, retail, energy: Maybank

  • 4 months ago
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VIETNAM’s economy is set for strong growth in 2022, boosted by a steady reopening and sizeable stimulus package, Maybank Securities said on Tuesday (Jan 4).

Analyst Hoang Huy noted that the key areas that would boost the Vietnam economy were a recovering domestic consumption, accelerated infrastructure investment, rising foreign direct investments and exports, and revitalised mergers and acquisitions activity.

Huy said the Vietnam market will likely post 28 per cent year-on-year growth in 2022, making it “the brightest star in the region”, with top performing sectors being banks, retail, energy, real estate and brokerages.

Although earnings growth in the first half will remain moderate as the economy is still recovering and H1 2021 had a high base, H2 earnings will likely be much stronger and valuations should revert to historical averages.

Market liquidity is likely also sustained at around US$1.4 billion by a consistent inflow of domestic retail investors and the return of foreign investors, amid a clearer picture of the economic recovery.

Huy added that the liquidity should flow back to large caps to “propel the VN Index to new highs in 2022”.

The analyst also expects 2022 will be a good time to enter Vietnam, as FTSE will likely upgrade Vietnam to a secondary emerging market in 2023, allowing a portion of more than US$3 trillion of exchange-traded funds tracking FTSE indices to flow into the country.

Huy noted that the brokerage’s 10 stock picks are focused on cyclical sectors, and are well-positioned to capture economic opportunities and deliver considerable returns in 2022.

Among banks, he recommended Vietcombank, Techcombank and Vietnam Prosperity Bank.

Meanwhile, Huy noted Mobile World Investment and Vincom Retail for retail-related counters, and Vinhomes and Hoa Phat Group for property-related counters.

As for energy, he recommended PetroVietnam Gas, and for logistics, his picks were Aviation Corp and Gemadept.

Source : businesstimes.com.sg

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