VietNam Holding (VNH) reported a 7.6% rise in net asset value (NAV) in August, exceeding the 6.6% gain in the Vietnam All Share Index, as Vietnam's stock market recovered from July's sell-off.
The stock market gain was supported by strong corporate earnings, more attractive valuations and growing interest ahead of Vietnam's promotion to FTSE Russell Secondary Emerging Market status.
VNH achieved its outperformance despite having no exposure to Vingroup, which gained 11.2% in August and now represents around 20% of the VN Index.
Banks were among the strongest contributors to performance, with Techcombank (TCB) rising 16.4%, MB Bank (MBB) gaining 13.9% and VPBank (VPB) advancing 13.1%. Retail holdings also performed strongly, led by FPT Retail (FRT), up 18.3%, and Digiworld (DGW), up 16.3%, while Mobile World Group (MWG) also advanced.
VNH said August marked a narrowing of the gap between share prices and underlying company performance after several months in which the two had appeared disconnected.
Vietnam's economic momentum also remained strong, with exports increasing 26% year-on-year, retail sales rising 14.9% and manufacturing PMI strengthening to 53.3. Public investment disbursement reached US$21bn in the first eight months of 2026, as the government continued its infrastructure programme.
Market earnings grew 36.6% in the second quarter and are still expected to increase by around 20% for 2026 as a whole.
The investment manager highlighted funding as an increasingly important consideration for the banking sector, with credit continuing to expand considerably faster than deposits. This is putting pressure on liquidity and increasing competition for funding.
VNH said banks with the ability to secure and diversify funding, protect margins and maintain asset quality should be best placed to benefit from continued credit demand. MBB, TCB and VPB were identified as among the private banks well positioned for the environment.
Together with VietinBank (CTG) and Asia Commercial Bank (ACB), banks accounted for close to 40% of the VNH portfolio at the end of August.
The manager also pointed to the capital requirements associated with Vietnam's infrastructure and investment ambitions, arguing that banks alone cannot finance the country's next stage of development. Deeper bond and equity markets will therefore be increasingly important.
Vietnam's promotion to FTSE Russell Secondary Emerging Market status takes effect on 21 September, following years of reforms aimed at improving access for international investors.
VNH said the upgrade would not transform the market overnight, with further progress on market access, liquidity and foreign ownership still required, but described it as another significant step in the development of Vietnam's capital markets.
The portfolio remained focused on earnings growth, governance, company fundamentals and valuation. At the end of August, it traded at 9.3 times forecast 2026 earnings, compared with 12 times for the Vietnam All Share Index.
The manager noted that the broader market's valuation has become increasingly influenced by a small number of outliers, most notably Vingroup, which trades on a P/E ratio of 85x.
View from Vox
August's rebound provides a useful reminder of the importance of fundamentals in a market where index performance is increasingly concentrated. VNH's 7.6% NAV gain, achieved without exposure to Vingroup, highlights the contribution from banks and retail names as earnings growth remains strong. The FTSE upgrade should provide another catalyst, although funding conditions, market concentration and continued reforms remain key factors to watch.