Vietnam Enterprise Investments asset value falls as MidEast war weighs

Vietnam Enterprise Investments Ltd on Monday said its first-half performance was hurt by rising fuel prices linked to the conflict between the US and Iran, with net asset value falling during the period.

The investor in listed Vietnamese equities said net asset value per share fell 3.7% to USD11.66 on June 30 from USD12.11 at December 31, underperforming the Vietnam stock market index, which had a positive 5.2% total return in the same period.

The investment company explained that the decline occurred during the first quarter, when NAV fell 6.5% amid a war-driven equity sell-off. It said the weaker performance was driven by a small number of positions rather than weakness across the portfolio.

Vietnam Enterprise said total net assets stood at USD1.60 billion at June 30, down 18% from USD1.95 billion at December 31.

Pretax loss for the period was USD71.1 million, widening from USD5.5 million a year earlier.

The company recorded a fair value loss of USD126.5 million, widening from a loss of USD5.9 million a year earlier.

Chair Charles Cade said the first six months was a "challenging period for active investors in Vietnamese equities due to concerns over the impact of the war in the Middle East on energy prices and global growth, as well as the degree to which the performance of the Vietnam Index was driven by Vingroup and its subsidiary companies."

Vietnam is particularly susceptible to global fuel prices as the country is a significant importer of energy, Cade explained.

Another primary driver of the investment trust's weak first-half performance was the 40% share-price drop at Phu Nhuan Jewellery, Vietnam's largest listed jewellery retailer, following allegations of involvement in a diamond-smuggling ring.

Looking ahead, Cade said the board remains optimistic about the company's future "and has continued to take steps to narrow the share price discount to NAV through a programme of tenders and share buybacks".

"Investors in an early-stage equity market such as Vietnam will inevitably face some volatile periods," the chair said.

"However, the board believes that Vietnam's core long-term drivers of economic growth remain compelling, with healthy foreign direct investment, rising urbanisation and the emergence of the middle-class consumer. The government is also highly supportive of growth, with an ambitious plan for infrastructure investment and business friendly policies. As a result, Vietnam's GDP is forecast to reach 9.3% in 2026, up from 8.0% in 2025."

Vietnam Enterprise Investments shares were down 0.1% to 728.00 pence on Monday morning in London.

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