Vietnam stocks in top 3 attractive investments in Asia

Vietnam is in the top 3 stock markets with good performance prospects in Asia - Pacific to invest in this year, according to CNBC.

Vietnam was named alongside Japan and India, after CNBC surveyed analysts. Like those two markets, Vietnam is benefiting from the "China + 1" strategy as multinational companies diversify their investments.

Andy Ho, investment director at VinaCapital Group, believes that this is the right time to invest in Vietnamese stocks. "In the next 6 to 12 months, Vietnam will be a good market because the stock prices are cheap, with P/E of only 11-12, 20-25% lower than the regional average," he told CNBC .

Average daily trading volume in Vietnam has increased from $500 million a year ago to about $1 billion a day today. Investment opportunities lie in consumer, healthcare and real estate stocks, according to Andy Ho.

Trading at Yuanta Stock Exchange, District 1, February 2022. Photo: Quynh Tran — Trading at Yuanta Stock Exchange, District 1, February 2022. Photo: *Quynh Tran*

With improved liquidity, investors are choosing stocks as an attractive investment channel, instead of depositing money in banks when interest rates decrease.

Vietnam aims to upgrade its stock market by 2025. Mr. Tyler Nguyen, Vice President of Maybank Securities Vietnam, assessed that the frontier market here is still very young but "can see good news by 2025".

In terms of macroeconomic conditions, Vietnam's economy is forecast to grow by 6-6.5% this year. Optimism in this market also caused foreign direct investment last year to reach more than 36.6 billion USD, up 32% compared to 2022, according to data from the Foreign Investment Agency (Ministry of Planning and Investment).

China accounted for about half of new FDI inflows into Vietnam last year, reflecting the Southeast Asian nation’s appeal as a rising manufacturing hub, according to HSBC ASEAN economist Yun Liu.

The Business Confidence Index (BCI) released by the European Chamber of Commerce in Vietnam (EuroCham) on January 8 called Vietnam a “rising star” in global investment. 62% of European businesses surveyed ranked Vietnam among the top 10 global investment destinations, with 17% ranking it the highest.

Faced with increasing competition in the region, Gabor Fluit, Chairman of Eurocham, said that Vietnam needs to improve policies and strategies to attract and maintain foreign direct investment.

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