Frontier and emerging markets (Vietnam)

Dylan Waller

Nomadic Equity

Thematic (Sector/Industry)

Vietnam officially removed the foreign ownership limitation this September, allowing foreign investors to take 100% ownership of companies.  This legislation is one of the last steps for Vietnam to successfully transition to an emerging market, yet its unclear implementation currently results in Vietnam still being a frontier market.  While the legislation has been passed, foreign investors can expect actual implementation to be an unclear, length process, determined on a case to case basis…

Vietnam officially removed the foreign ownership limitation this September, allowing foreign investors to take 100% ownership of companies.  This legislation is one of the last steps for Vietnam to successfully transition to an emerging market, yet its unclear implementation currently results in Vietnam still being a frontier market.  While the legislation has been passed, foreign investors can expect actual implementation to be an unclear, length process, determined on a case to case basis…

Vietnam's Removal of the Foreign Ownership Limitation: A Future Portfolio for Emerging Vietnam

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>Last October, a global index provider announced that Vietnam would be added to their index in September 2026 as long as progress was made on one key issue.</li>
<li>On 2 February, the Ministry of Finance issued a circular that allows foreign investors to place orders through global brokers, in addition to trading through local brokers.</li>
<li>That should clear the way for inclusion of Vietnam stocks in the global index in September. Inclusion should take place in more than 1 tranche to minimise market impact.</li>
</ul>


Last October, a global index provider announced that Vietnam would be added to their index in September 2026 as long as progress was made on one key issue.
On 2 February, the Ministry of Finance issued a circular that allows foreign investors to place orders through global brokers, in addition to trading through local brokers.
That should clear the way for inclusion of Vietnam stocks in the global index in September. Inclusion should take place in more than 1 tranche to minimise market impact.


Vietnam: Global Index Inclusion Probability Jumps; Updated Names & Flows

External broker reports(aggregated public sources), Vietcap

Vietcap

External broker reports(aggregated public sources)

We specialize in consulting both individual and institutional clients, providing them with effective financial solutions that are tailored to their specific needs.

Equity Bottom-Up

<ul><li>We raise our target price (TP) for GEX by 104% but downgrade our rating from OUTPERFORM to MARKET PERFORM as its share price has rallied 251% over the past four months.</li><li>Our higher valuation is mainly driven by: (1) a 64% increase in electrical equipment valuation (reflecting a 34% higher aggregate 5Y NPAT-MI and a higher target P/E),</li><li>(2) an 81% uplift in hotel &amp; office valuation (higher valuation for the Fairmont Complex launching in Q4 2025, vs our prior equity-only valuation),</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We raise our target price (TP) for GEX by 104% but downgrade our rating from OUTPERFORM to MARKET PERFORM as its share price has rallied 251% over the past four months.Our higher valuation is mainly driven by: (1) a 64% increase in electrical equipment valuation (reflecting a 34% higher aggregate 5Y NPAT-MI and a higher target P/E),(2) an 81% uplift in hotel &amp; office valuation (higher valuation for the Fairmont Complex launching in Q4 2025, vs our prior equity-only valuation),Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

GELEX Group (GEX) - GEE, VGC’s Strong Earnings to Boost GEX’s Valuation

<ul><li>We cut our target price (TP) for GEX by 4% but upgrade our rating from OUTPERFORM to BUY as its share price has dropped 13% over the past three months.</li><li>We cut our TP due to a higher conglomerate discount of 30% (vs 15% previously, details on page 7), which outweighs our 9% higher aggregate 2025-2029F NPAT-MI projections for GEX (respective changes of +10%/+7%/+7%+10%/+11%).</li><li>- Our higher aggregate five-year NPAT-MI is mainly driven by our 18% higher earnings projection for GEE (due to higher revenue growth as well as higher GPM projections following 9M results) and our 1% higher aggregate NPAT-MI projection for VGC.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We cut our target price (TP) for GEX by 4% but upgrade our rating from OUTPERFORM to BUY as its share price has dropped 13% over the past three months.We cut our TP due to a higher conglomerate discount of 30% (vs 15% previously, details on page 7), which outweighs our 9% higher aggregate 2025-2029F NPAT-MI projections for GEX (respective changes of +10%/+7%/+7%+10%/+11%).- Our higher aggregate five-year NPAT-MI is mainly driven by our 18% higher earnings projection for GEE (due to higher revenue growth as well as higher GPM projections following 9M results) and our 1% higher aggregate NPAT-MI projection for VGC.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

GEX [BUY +25.9%] - Core NPAT to double in 2025F - Update

<ul><li>We cut our target price (TP) for GEX by 6% but maintain our OUTPERFORM rating.</li><li>We cut our TP due to a higher conglomerate discount of 15% (vs 10% previously), which outweighs our 4% higher aggregate 2024-2028F NPAT-MI projections for GEX (respective changes of +35%/+1%/-12%/-6%/+9%).</li><li>Our higher aggregate five-year NPAT-MI is mainly driven by our 4% higher earnings projection for GEE (due to higher GPM projections), which outweighs our lower earnings forecast by 2% for VGC (due to higher projected minorities interest) (see page 8). </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We cut our target price (TP) for GEX by 6% but maintain our OUTPERFORM rating.We cut our TP due to a higher conglomerate discount of 15% (vs 10% previously), which outweighs our 4% higher aggregate 2024-2028F NPAT-MI projections for GEX (respective changes of +35%/+1%/-12%/-6%/+9%).Our higher aggregate five-year NPAT-MI is mainly driven by our 4% higher earnings projection for GEE (due to higher GPM projections), which outweighs our lower earnings forecast by 2% for VGC (due to higher projected minorities interest) (see page 8). Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Gex - Strong Core Earnings Projected Across Segments in 2025F

Vietnam

Gelex Group is a leading investment group in Vietnam, primarily engaged in the production and sale of electrical equipment, including power cables, transformers, and electrical measuring equipment. The company also operates in industrial production, real estate, and infrastructure, developing projects in energy, industrial real estate, and building materials. Gelex Group was founded in 1990 and is headquartered in Hanoi, Vietnam.

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Gelex Group (GEX VN)

Vietnam's Removal of the Foreign Ownership Limitation: A Future Portfolio for Emerging Vietnam

Vietnam officially removed the foreign ownership limitation this September, allowing foreign investors to take 100% ownership of companies. This...

Nomadic Equity

Vietnam: Global Index Inclusion Probability Jumps; Updated Names & Flows

The MoF approval for international investors to place orders through global brokers resolves the main hurdle for global index inclusion. Passives...

Brian Freitas

GELEX Group (GEX) - GEE, VGC’s Strong Earnings to Boost GEX’s Valuation

We raise our target price (TP) for GEX by 104% but downgrade our rating from OUTPERFORM to MARKET PERFORM as its share price has rallied 251% over...

Vietcap

GEX [BUY +25.9%] - Core NPAT to double in 2025F - Update

We cut our target price (TP) for GEX by 4% but upgrade our rating from OUTPERFORM to BUY as its share price has dropped 13% over the past three...

Vietcap

Gex - Strong Core Earnings Projected Across Segments in 2025F

We cut our TP due to a higher conglomerate discount of 15% (vs 10% previously), which outweighs our 4% higher aggregate 2024-2028F NPAT-MI...

Vietcap

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