VFMVF4 – 04/2016
In April, VF4 has its NAV grown by 3.9% with the main contribution from the recovery of the blue-chips in Food & Beverage, Banking, Utilities and Insurance. These industries have got impressive growth in stock price in April: Insurance grow by 14.6%, Utilities +12.7%, Energy +12.2%, Bank +7.2%.
VN-Index has appreciated higher than VF4 return due to the fact that the weight of some big-caps like VCB and GAS in VN-Index is more than double the weight of those stocks in VF4 while these two have increased strongly in April, by 12.2% and 24.4% respectively. This abnormal return in these two stocks resulted from the foreign fund flowing into high weighting stocks as well as the market sentiment of oil price recovery. The abnormal return is considered to be short-term nature in comparison with companies’ fundamental change. In terms of year-to-date return, VF4 is still higher than VN-Index by 0.4%.
In April, VF4 has realized profits, as well as decrease the allocation in the industries such as Insurance, Real Estate and increase cash balance to 17% NAV, which is planned to be allocated in new investment opportunities. At the end of April, the largest holding of VF4 is still in Food & Beverage industry with VNM accounted for 18% of NAV. VNM has just announced its first quarter earnings result in 2016 with impressive profit growth rate of 38% compared to the same period last year and propose a 60% cash dividend together with a 40% advance payment of next year dividend in this year 2016. Besides, VNM has updated its AGM materials with a proposal of 20% stock bonus and un-restricting the room of foreign ownership. We believe that the stocks with decent business growth and healthy financial condition will attract the foreign investment as well as having its market price appreciate in the future.