Vietnamese stock market continues strong upward trend
Investors watch stock market's movements (Photo: VNA) |
The recent market uptrend has been supported by positive business performance from listed companies. According to broker VNDirect, the estimated net profit of 1,128 companies (accounting for 96% of market capitalisation) in the fourth quarter of 2023 rose by 30% compared to the same period in 2022. This growth is attributed to improved business activities of companies and the low base effect from the fourth quarter of 2022.
The net profit of the banking sector in the fourth quarter of 2023 increased by 22.5% compared to the same period, driven by accelerated credit growth, strong non-interest income (fee income, foreign exchange activities), industry-wide income growth of 20%, and a 5% reduction in provisioning expenses. The banking sector has played a leading role in the recent market surge.
The net profit of the real estate sector in the fourth quarter of 2023 declined by 19.6% compared to the fourth quarter of 2022, and 24% compared to the third quarter of 2023. However, the decline is primarily due to Vinhomes (VHM). Excluding VHM from the calculations, the net profit of the real estate sector still grew by 132% compared to the fourth quarter of 2022.
The positive performance in business activities of the two largest sectors, banking and real estate, has facilitated a smooth start to the year 2024 for the market. Many investors are expecting improved stock market performance this year after a challenging 2023. In fact, large organisations also hold high expectations for this prospect.
In 2024, Dragon Capital forecasts that the global landscape still poses challenges as global economic growth slows down. However, the domestic market will experience significant recovery as the low-interest rate environment has enough time to permeate the economy, stimulating consumer demand and igniting investment intentions of businesses and investors.
The government's commitment to continue flexible monetary and fiscal policies is crucial to reinforce the confidence of private enterprises. Analysts predict that the profit growth of the 80 largest companies will range from 16-18%, providing a solid foundation for the stock market to be the most attractive investment channel in 2024.
Individual investors account for over 88% of the market. The 12-month deposit interest rate at banks is only around 4.7%, which is not attractive compared to the expected market profit of 10.9% (based on a projected P/E ratio of 9.1 for 2024).
Other investment channels such as real estate have certain limitations, including the need for large capital, low liquidity, and investor concerns about the legal aspects of real estate projects. Therefore, there is a likelihood that significant amount of capital will shift to the stock market.
Moreover, foreign capital flows may improve with any positive market information, such as the untangling of pre-funding or new progress in the process of upgrading to emerging market status. Overall, Dragon Capital considers 2024 an attractive time to participate in the stock market.
Similarly, Pyn Elite Fund also expresses optimism about the market's prospects in the near future. The growth rate of Vietnam’s economy is showing signs of recovery, and there are positive profit prospects in the coming years.
Currently, the stock market has yet to reflect the pace of earnings growth of companies and the story of interest rate reduction. If domestic interest rates decrease, market liquidity will increase, and the expected strong growth in corporate profits will contribute to the overall profitability of the market.
See also
Việt Nam's stock market moves closer to emerging market status amid key policy changes
18:05 | 06/11/2024 Stock Market
Asian shares are at their lowest in three weeks
16:18 | 19/10/2024 Stock Market
Stock market sees notable recovery amid ongoing uncertainties
09:11 | 15/10/2024 Stock Market
SSI: Masan to benefit from Vietnamese stock market upgrade
17:11 | 02/10/2024 Stock Market
Japan helps Vietnam improve stock market’s transparency
15:40 | 23/09/2024 Stock Market
Market expected to pass psychological 1,300 mark
15:10 | 26/08/2024 Stock Market
See more news
Market soars above 1,260 points
10:43 | 20/08/2024 Stock Market
Stock market expected to continue recovery in the remainder of the year
17:56 | 18/08/2024 Stock Market
Surge in new individual securities accounts in July
08:21 | 10/08/2024 Stock Market
The market requires a prolonged period to reach stability
14:55 | 05/08/2024 Stock Market
Vietnamese stock market sees remarkable 24-year transformation
09:30 | 31/07/2024 Stock Market
Bank stocks surge on dividend payouts and profit growth
07:00 | 29/05/2024 Stock Market
Stock market upgrade to help Vietnam lure another 10 bln USD in investment
09:23 | 03/05/2024 Stock Market
Over 163,000 new stock trader accounts created during March
08:48 | 09/04/2024 Stock Market
PM urges efforts to upgrade stock market to emerging status
08:50 | 29/02/2024 Stock Market
Experts suggest measures to lure investment in securities market
08:46 | 19/12/2023 Stock Market
VAT tax reduction should continue until mid-2025: Ministry
17:15 | 21/11/2024 Policy
Top legislator starts official visit to Cambodia
17:09 | 21/11/2024 News and Events
Việt Nam and Malaysia upgrade relationship to Comprehensive Strategic Partnership level
17:01 | 21/11/2024 Cooperation
Hà Nội prepares for temperature drop as cold front approaches
16:56 | 21/11/2024 Environment
First Vietnam Dialogue opens new avenues for Vietnam-Germany financial cooperation
16:18 | 21/11/2024 Cooperation
Multimedia
Vietnam - Malaysia Strategic Partnership
10:54 | 21/11/2024 Infographic
Vietnam, Dominican Republic strengthening cooperation
08:45 | 20/11/2024 Infographic
Vietnam - Brazil strategic partnership
10:26 | 19/11/2024 Infographic
Nhon - Hanoi Station elevated urban railway comes into operation
09:04 | 18/11/2024 Infographic
Key facts on G20 and Vietnam's participation
09:42 | 17/11/2024 Infographic
VAT tax reduction should continue until mid-2025: Ministry
17:15 | 21/11/2024 Policy
NA deputies scrutinise investment policy for North-South high-speed railway project
08:54 | 21/11/2024 Policy
Developing relations with China is Vietnam’s top priority: Deputy PM
08:40 | 20/11/2024 Policy
Vietnam pledges to make more contributions to APEC cooperation
09:46 | 17/11/2024 Policy
Tra fish sector aiming for production, processing greening for sustainable development
15:38 | 20/11/2024 Industry
Solutions discussed to ensure coal supply for electricity generation in 2025
16:24 | 19/11/2024 Energy
Garment industry targets 47-48 billion USD in export turnover next year
16:16 | 19/11/2024 Industry
Residents support restarting Ninh Thuận Nuclear Project, call for clear roadmap
14:46 | 18/11/2024 Energy
Workshop seeks ways to attract Japan’s green investment to Vietnam
09:43 | 20/11/2024 Investment
Government approves investment policy to build Cam Lien Industrial Park in Quang Binh
16:57 | 18/11/2024 Investment
Disbursement of public investment must be accelerated: Deputy PM
12:17 | 17/11/2024 Investment
LG plans to pour further US$1 billion investment into Vietnam
10:42 | 16/11/2024 Investment
HDBank wins three awards at Vietnam Listed Company Awards 2024
10:53 | 21/11/2024 Finance-Banking
VIB, Flywire partner to streamline cross-border payments for students from Vietnam
16:46 | 18/11/2024 Finance-Banking
Vietcombank issues 2 trillion VND worth of green bonds for first time
18:55 | 16/11/2024 Finance-Banking
UK stands ready to help Vietnam build international financial hub
17:13 | 13/11/2024 Finance-Banking
Hà Nội prepares for temperature drop as cold front approaches
16:56 | 21/11/2024 Environment
Hundreds of damaged irrigation reservoirs need repairing
09:02 | 20/11/2024 Environment
Greening e-commerce crucial for sustainable development
10:47 | 18/11/2024 Environment
National Environmental Protection Plan ensures high quality living environment
08:59 | 18/11/2024 Environment
People, community at heart of digital transformation: Deputy PM
09:26 | 21/11/2024 Science - Technology
AI is core technology of 4th Industrial Revolution: Minister
11:19 | 20/11/2024 Science - Technology
Global scientific luminaries to gather at VinFuture sci-tech week
11:08 | 19/11/2024 Science - Technology
Hà Nội to host 2024 e-commerce and digital economy forum on November 21
17:23 | 17/11/2024 Science - Technology
Việt Nam-UK Institute plans for an international university
09:14 | 21/11/2024 Society
Hanoi aims to become a smart city by 2030
09:13 | 21/11/2024 Metropolis
Huế Central Hospital boosts international cooperation to become global health hub
16:30 | 20/11/2024 Society
Hà Nội hospital partners with UK charity to provide surgeries for children with facial deformities
16:03 | 20/11/2024 Society
VN takes part in food and beverage fair in Chicago
09:45 | 20/11/2024 Vietnamese Brands
Hòa Bình honey awaits reactions from UK
10:41 | 19/11/2024 Vietnamese Brands
Post-Typhoon Yagi trade networking event starts in Hải Dương
10:04 | 19/11/2024 Vietnamese Brands
Hòa Bình exports honey and pearl onions to UK
10:17 | 16/11/2024 Vietnamese Brands
Bac Ninh Province: Dong Ho folk painting needs urgent safeguarding
15:04 | 20/11/2024 Culture
Vietnamese designers tell stories of culture at Fashion Week
10:14 | 20/11/2024 Culture
Creative City promotes socio-economic development, says expert
09:59 | 20/11/2024 Lifestyle
Five Vietnamese creations listed among the world’s 100 best-rated dishes with coconut
10:54 | 19/11/2024 Culture
Blooming buckwheat flowers on Ha Giang roads
14:54 | 21/11/2024 Tourism
Folk cultural festival on Côn Đảo Island attracts tourists
10:07 | 20/11/2024 Tourism
Tra Que named among world’s best tourism villages in 2024
11:20 | 18/11/2024 Tourism
Quảng Ninh to attract more foreign tourists by year-end
16:52 | 14/11/2024 Tourism