Annual Report - 2022
LSE-listed investment company focused solely on Vietnam:
the fastest-growing economy in South East Asia. Invests in
high-growth companies, focusing on domestic consumption,
industrialisation and urbanisation.
Capturing the growth of Vietnam through an actively managed, high-conviction
portfolio of companies.
Our Purpose
Our Vision
Owning a portfolio of companies with the potential to double their underlying
between high-growth small-and-medium companies and best-in-class blue
following a trajectory of better Environmental, Social, Governance practices.
Highlights
Company Overview
Summary Information
Chairman’s Statement
Investment Manager’s Report
Top Five Portfolio Companies
Sustainability Report
Principal Risks and Risk Management
1
2
3
5
7
16
21
28
Strategic ReportContents
Independent Auditor’s Report
Statement of Financial Position
Statement of Comprehensive Income
Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Alternative Performance Measures
Corporate Information
47
52
53
54
55
56
70
71
Financial Statements
Director Proles and Disclosure of Directorships
Corporate Governance Report
Audit and Risk Committee Report
Directors’ Remuneration Policy and Report
Directors’ Report
Statement of Directors’ Responsibilities
31
32
37
39
41
45
Governance
Strategic ReportAnnual Report 2022
Average NAV
Operating expenses*
Ongoing charges
Operational Highlights
Financial Highlights
Successful tender oer in September 2021 returned USD
56.7m to participating shareholders
Including tender oer, Net Asset Value (“NAV”) decreased
during the period by USD 67.3m to USD 128.8m
NAV per share (USD) fell by 4.2% and NAV per share
(GBP) rose by 9.0%
Share price rose 16.7% during the year and the discount to
NAV narrowed from 20.4% to 14.7%
Fund is invested in 24 positions
Top-ten positions account for 67.5% of the NAV
Outperformed VNAS index on 1, 3, 5 and 10 years basis
Estimated average carbon footprint of the portfolio is
67.5% lower than the VNAS index
As at 29 September 2022 (the latest available date before approval of the accounts), the discount to NAV had moved to
12.3%. The estimated NAV per share and mid-market share price at 29 September 2022 was 354.8p and 311.0p respectively.
Ongoing Charges
Ongoing charges for the year ended 30 June 2022 have been calculated in accordance with the Association of Investment
Companies (the “AIC”) recommended methodology. The ongoing charges for the year ended 30 June 2022 were 2.74%. Refer
to page 70 for the denitions of Alternative Performance Measures (“APMs”) together with how they have been calculated.
Year end 30 June 2022 USD
155,041,007
4,242,306
2.74%
a
b
b/a
*Operating expenses per the nancial statements less non-recurring expenses of USD 9,788.
Net Asset Value
per share (GBP)
Share
Price
Net Asset Value
per share (USD)
Discount to Net
Asset Value
128.8m
196.1m
‘22 ‘21
128.8m 4.408 363.0p
309.5p
14.7%
4.408
4.600
‘22 ‘21
363.0p
333.0p
‘22 ‘21
309.5p
265.0p
‘22 ‘21
14.7%
20.4%
‘22 ‘21
Total Net
Assets (USD)
Highlights
Strategic ReportAnnual Report 2022
1
Strategic ReportAnnual Report 2022
Vietnam specialist, regulated by the
Guernsey Financial Services Commission.
Partner-owned business whose sole
focus is asset management. Appointed
Investment Manager on 16 July 2018.
Premium Listed London Investment
Company established in 2006. Seeks to
achieve long-term capital appreciation
by investing in a diversied portfolio
of companies in Vietnam that have
high growth potential at an attractive
valuation.
Big enough to be an active and engaged shareholder in portfolio companies, nimble
enough to nd and fund less- known emerging champions.
The Company is able to invest in best-in-class names across the spectrum of rm size
with the exibility to include pre-IPO, small-mid caps and large caps in the portfolio.
High conviction, o-index positions managed by the Investment Manager’s active
ownership capabilities.
Since its early days the Company has been an active adherent to best practice
in Environmental, Social and Governance issues, believing that better-managed
companies on these dimensions will be worth more in the longer-term. The Company
has been a signatory of the United Nations Principles for Responsible Investing
(“UNPRI”) for over a decade and received ve-star scores in the recent UNPRI report.
The Company
Investment Manager
Top-down & bottom-up research
driven fundamental analysis.
Active engagement with portfolio
companies on ESG.
Long-term investment horizon.
Capturing the growth of Vietnam
through long term investment in an
actively managed, high-conviction
portfolio of companies.
Protect shareholder interests by aspiring
to the highest standards of corporate
governance at both fund & portfolio level.
What Dynam Does:Dynam Capital Ltd
Vietnam Holding
Right Size for the
Vietnam Equity Market
ESG in the DNA
Nimble Access
Across Spectrum
Actively Managed
Portfolio
What Vietnam Holding Does:
Company Overview
Focused Investment
Portfolio of 24 positions with 67.5% in top-ten
positions. The portfolio has a Price-to-earnings
valuation of circa 10x and an Earnings growth
forecast of circa 20% for 2023.
2
Strategic ReportAnnual Report 2022
The Company
VietNam Holding Limited (the “Company” or “VNH”) is a
closed-end investment company that was incorporated
in the Cayman Islands on 20 April 2006 as an exempted
company with limited liability under registration number
166182. On 25 February 2019, the Company, via a process
of cross-border continuance, transferred its legal domicile
from the Cayman Islands to Guernsey and was registered
as a closed-ended company limited by shares incorporated
in Guernsey with registered number 66090. The Shares
were admitted to trading on AIM in June 2006 and changed
to a Premium Listing on the Ocial List of the UK Listing
Authority and admitted to trading on the Main Market of
the London Stock Exchange on 8 March 2019. The Company
also listed on the Ocial List of The International Stock
Exchange on 8 March 2019. The Company has an unlimited
life with a continuation vote in 2023.
Investment Objective
The Company’s investment objective is to achieve long-
term capital appreciation by investing in a diversied
portfolio of companies that have high growth potential at
an attractive valuation.
Investment Policy
The Company attempts to achieve its investment objective
by investing in the securities of publicly traded companies
in Vietnam, and in the securities of foreign companies if
a majority of their assets and/or operations are based in
Vietnam. The Company may invest in equity securities or
securities that have equity features, such as bonds that
are convertible into equity.
The Company may invest in listed or unlisted securities,
either on the Vietnamese stock exchanges, through
purchases on the OTC Market, or through privately
negotiated deals.
The Company may invest its available cash in the Vietnamese
domestic bond market as well as in international bonds
issued by Vietnamese entities.
The Company may utilise derivatives contracts for hedging
purposes and for ecient portfolio management but will
not utilise derivatives for investment purposes.
The Company does not intend to take control of any
company or entity in which it has directly or indirectly
invested (the “investee company”) or to take an active
management role in any such company. However Dynam
Capital, Ltd. (“Dynam Capital”), (the “Investment
Manager”) may appoint one of its directors, employees or
Borrowing Policy
The Company is permitted to borrow money and to grant
security over its assets provided that such borrowings
do not exceed 25% of the latest available NAV of the
Company at the time of the borrowing unless the
Shareholders in general meeting otherwise determine by
ordinary resolution.
Investment Restrictions and Diversication
The Company will adhere to the general principle of risk
diversication in respect of its investments and will observe
the following investment restrictions:
up to 25% of its Net Asset Value (“NAV”) (at the
time of investment) in companies with shares traded
outside of Vietnam if a majority of their assets and/or
operations are based in Vietnam;
up to 20% of its NAV (at the time of investment) in
direct private equity investments; and
up to 20% of its NAV (at the time of investment) in
other listed investment funds and holding companies
which have the majority of their assets in Vietnam.
the Company will not invest more than 10% of its NAV
(at the time of investment) in the shares of a single
Investee Company;
the Company will not invest more than 30% of its
NAV (at the time of investment) in any one sector;
the Company will not invest directly in real estate or
real estate development projects, but may invest in
companies which have a large real estate component,
if their shares are listed or are traded on the OTC
Market; and
the Company will not invest in any closed-ended
investment fund unless the price of such investment
fund is at a discount of at least 10% to such investment
fund’s NAV (at the time of investment).
other appointees to join the board of an Investee Company
and/or may provide certain forms of assistance to such
company, subject to prior approval by the VNH Board.
The Company integrates environmental, social and
corporate governance (“ESG”) factors into its investment
analysis and decision-making process. Through its
Investment Manager, the Company actively incorporates
ESG considerations into its ownership policies and
practices and engages investee companies in pursuit of
appropriate disclosure and the improvement of material
issues.
The Company may invest:
Summary Information
3
Strategic ReportAnnual Report 2022
Furthermore, based on the guidelines established by the
United Nations Principles for Responsible Investment
(“UNPRI”), of which the Company is a signatory:
Any material change to the investment policy will only
be made with the approval of Shareholders by ordinary
resolution.
Shareholder Information
Sanne Group (Guernsey) Limited (the “Administrator”) is
responsible for calculating the NAV per share and delegates
this function under a legal contractual arrangement to
Standard Chartered Bank (Singapore) Limited (the “Sub-
Administrator”), previously Standard Chartered Bank,
Singapore Branch until its transference under the Banking
Act on 13 May 2019. The estimated NAV per ordinary share
is calculated as at the close of business each business
day by the Investment Manager and published at close
of business in Vietnam the same day. The monthly NAV is
calculated by the Sub-Administrator on the last business
day of every month and announced by a Regulatory News
Service within 10 business days.
the Company will not invest in companies known to be
signicantly involved in the manufacturing or trading
of distilled alcoholic beverages, tobacco, armaments
or in casino operations or other gambling businesses;
the Company will not invest in companies known to
be subject to material violations of Vietnamese laws
on labour and employment, including child labour
regulations or racial or gender discriminations; and
the Company will not invest in companies that do not
commit to reducing in a measurable way pollution
and environmental problems caused by their business
activities.
4
Strategic ReportAnnual Report 2022
Dear Shareholder,
I am pleased to present the Annual Report for VietNam
Holding Limited in yet another extraordinary twelve-
month period ending 30 June 2022.
The Company’s Total Assets were USD 129,177,449 at 30
June 2022, a decrease of 35.6% from USD 200,418,206 at
30 June 2021. This is partly due to the successful tender
oer for 30% of the Company’s shares in September 2021.
Total Comprehensive loss was USD 7,719,310 compared with
income of USD 100,153,888 in the corresponding period in
2021. Although the Company’s Net Asset Value (“NAV”)
has declined in absolute numbers to USD 129m, the focus,
active management, and nimble performance of the
Investment Manager have led to a signicant relative
outperformance of 12.2% against the market as a whole.
The Company also has outperformed most of its peers.
Vietnam’s handling of the vaccination rollout in the rst
half of the nancial year – July to December 2021 – was
nothing short of remarkable. It went from a low-level
number of vaccinations due to the lack of supply in April
to a smooth distribution by December when some cities
were almost 100% double vaccinated and by early 2022
more than 50% of the population were triple vaccinated.
This was a direct eect of the ‘living with COVID-19’
approach taken by the government, in contrast with the
‘zero-COVID-19’ policies of China, which meant that strict
quarantine restrictions could be lifted.
So, as two years of COVID-19 restrictions nally faded,
Vietnam opened up its borders to international travellers
in April this year. Later in June the Board met in person in
Vietnam to meet with the research team of the Investment
Manager, as well as visit a number of portfolio companies
and other investors and market participants. It was good
to be back in the exciting market of Vietnam and see rst-
hand the early signs of its strong post-COVID-19 recovery.
Hiroshi Funaki
Chairman
Although Russia’s invasion of Ukraine on 24 February has
disrupted the world signicantly and added inationary
fuel to the re in Europe and North America, the direct
impact on Vietnam appears to be much less evident. To
start, Vietnam’s direct trade with Russia is less than 1% of
total trade. That said, there are deep historical linkages with
many Vietnamese entrepreneurs having ‘cut their teeth’ on
business in Russia and Ukraine. There are also military ties,
and the former USSR was a key supporter to Vietnam in the
1980s.
Ination has been less of a direct issue for Vietnam especially
since the country is only a modest importer of oil and gas
and has a more diversied energy mix than many other
Asian countries, for example, with hydropower, wind, and
solar energy supplying close to 50% of the country’s needs.
The macro-economy of Vietnam is also robust compared
to many other Emerging and Frontier markets and its GDP
growth levels reported in June surprised on the upside as
many other economies around the world shrank. Several
banks have recently increased their full year GDP growth
forecasts for Vietnam at close to 7%. With ination forecast
to reach 3.5% to 4.0% by year-end, there is real growth.
Retail consumers are buying, and retail investors are waiting
for better global news to return to the market. So, after
almost two years of net-selling of public equities by foreign
portfolio investors, there are signs signalling that the tide
may be turning. The
Investment Manager’s Report
includes
more details on the outlook for both the market and the
portfolio, explaining further how Vietnam certainly appears
to be a market that can still deliver high earnings growth at
reasonable valuations.
Discount
In the Interim Report issued six months ago we wrote about
the narrowing discount between the Fund’s share price
and prevailing NAV. This time last year the discount hit
25% and has narrowed considerably since with the tender
oer last September and the ongoing eorts of the Board
in managing the discount through regular share buybacks,
but also with the Investment Manager in delivering strong
relative performance and an active investor relations
program. In February 2022 it touched a low of 4.43%, and
although that has widened to 14.7% at 30 June 2022, the
discount has been the narrowest of three London listed
investment trusts focussed on Vietnam for much of the last
six months. At 29 September 2022, the discount was 12.3%.
Marketing
With the help of the Investment Manager, Dynam Capital
– and despite travel restrictions imposed for much of the
rst half of the year – the Board has further developed the
Company’s marketing activity throughout the year to help
narrow the discount, improve liquidity in the Company’s
shares, and widen our Shareholder base.
Chairman’s Statement
5
Strategic ReportAnnual Report 2022
The Investment Manager has been actively promoting the
Company and along with our broker and sales partners
has organised roadshows, topical seminars, podcasts, and
several webinars. It also presented at the Mello Event in
May 2022 (returning after a two-year hiatus) where it was
a delight to meet many investors in the Company face-to-
face.
Our analysis shows that the marketing and communications
eorts continue to bear fruit. We are delighted to see a
greater number of wealth management platforms on the
share register having also seen the overall mix of investors
broaden considerably over recent years. The Company
has also been proactively promoted through a wide range
of media outlets, including video, audio, and online print
media, and has been featured several times in publications,
such as
Investors Chronicle
. The Investment Manager has
maintained a strong social media presence for the Company
as well. We welcome all Shareholders who may be reading
this Annual Report for the rst time and thank all existing
holders for their ongoing support.
Share Buybacks
The Board has a mandate to authorise the purchase up
to 14.99% of the Company’s shares each year in the open
market at prices below NAV per share, and this was renewed
at the Annual General Meeting (“AGM”) on 1 November
2021. In the year from 1 July 2021 to 30 June 2022, the
Company bought back 661,084 shares (representing 2.3% of
the shares outstanding at 1 July 2021) at a weighted average
discount of 15.9%. This resulted in a 0.25% accretion to NAV
per share. From September 2017, when the current Board
was appointed, through until 30 June 2022, the Company
has bought back 13.32 m shares at a weighted average
discount of 15.4%. This represents a 2.8% accretion to NAV
per share.
Tender Oers
From time to time the Board uses tender oers to provide
a liquidity opportunity for investors in the Company.
Last September Shareholders approved the Board’s
recommended tender oer for 30% of the Company’s
shares at a 2% discount to the prevailing NAV per share as
at 31 August 2021.
Performance
In the twelve months to 30 June 2022 the Company’s NAV
per share declined by 4.36%, while the market as a whole,
as measured by the Vietnam All Share Index, declined by
16.5%. In the rst six months of the nancial year the NAV
per share rose by 14.1%, against an index rise of 10.6%, and
in the second six months the Company’s NAV declined by
16% versus the index, which fell by more than 24%. At 30
June the Company has outperformed the VNAS on 1, 3, 5
and 10-year measures.
6
Hiroshi Funaki
Chairman
VietNam Holding Limited
30 September 2022
Performance monitoring remains a key focus of the Board
and we engage closely with our Investment Manager in
this respect through monthly conference calls attended
by members of the Board in addition to quarterly
presentations. A more detailed account of the Company’s
annual performance is also provided in the Investment
Manager’s Report.
Responsible Investing and Sustainability Reporting
The Investment Manager and the Board have been
committed to responsible investing and a joined-up
approach to environmental, social and governance
(“ESG”) years before the mainstream global investing
community took up the challenge. The Company has
been a signatory to the United Nations’ Principles on
Responsible Investing (“UNPRI”) since 2009. Although the
UNPRI itself has been restructuring its reporting platform,
the Company received ve-star scores for its 2021 UNPRI
report and we continue to contribute to responsible
investing in Vietnam in a meaningful way. We have been
measuring the carbon footprint of both the Company and
the portfolio for several years, and this year’s ndings are
in the
Sustainability Report
. The highlights are that the
Company has a lower estimated carbon footprint than the
index while continuing to out-perform the index. During
the year the Investment Manager hosted a webinar for 50
companies in Vietnam about the steps needed to increase
the accuracy of carbon-footprint reporting, and we have
been encouraging our portfolio companies to raise the bar
in their own ESG initiatives.
On behalf of the Board, I would like to extend a further
thank-you to Shareholders for your ongoing support
throughout the past year. Although the global mood is
gloomy, we believe Vietnam remains a bright spot – an
attractive investment destination with good prospects for
further growth over the years to come.
Strategic ReportAnnual Report 2022
Investment Manager’s Report
This year marks the 16th anniversary of the Company
and its listing in London
1
- the Company is just four years
younger than Vietnam’s stock market.
Strong Outperformance
The interim report as of 31 December 2021 characterised
the last six months of the year as a period of resilience
and divergence. During the rst six months of the nancial
year to 31 December 2021, the NAV per share rose by 14.1%,
ahead of the Vietnam All Share Index (“VNAS”) gain of
10.6%. Throughout the second half of the nancial year,
the equity markets themselves were divergent from
the resilient macro-economic position and we saw the
Vietnam market fell by 24.5% in line with the sell-o in
global markets while the Company’s NAV per share fell by
16.0%. As at 30 June 2022, the NAV per share declined by
4.2% for the full nancial year, in contrast with the 99%
increase in NAV per share we reported for the previous
nancial year. Nevertheless, the Company continues
to outperform its peers, and has also outperformed the
VNAS on a 1, 3, 5 and 10-year basis. During the nancial
year the Company’s share price rose 16.8%, signicantly
ahead of its much larger peers: Vietnam Opportunity
Fund, VOF, which rose by 1.1% and Vietnam Enterprise and
Investment Limited, VEIL, which fell by 3.4%. This is due to
a combination of higher NAV per share performance and
narrower discount between the share price and the NAV.
High Conviction Portfolio
The Company maintains a high-conviction portfolio
concentrated in 24 positions, with its top-ten positions
making up 67.5% of NAV. The largest position, FPT
Corporation, FPT, which is 11.5% of NAV, is the country’s
leading IT and telecoms services company. It rose by 19.9%
as it continues to see signicant traction in its domestic
and overseas business. Mobile World, MWG, which is 9.2%
of NAV, is a leading omni-channel retailer. It rose by 42.7%
as it strengthened its position as one of the country’s
largest e-commerce players and started to reposition
and streamline its grocery business. Gemadept (“GMD”),
Vu Quang Thinh Craig Martin
CIO and Managing Director Chairman and Managing Director
1
The Company was initially admitted to AIM in July 2006 and then moved
to the premium segment of the main board of the London Stock Exchange
in March 2019.
2
Source: OECD Report
which is 8.5% of NAV and the largest port operator in
Vietnam rose by 23.9% as it experienced strong growth
in volumes and prot from its new deep-water container
port. Phu Nhuan Jewelry, PNJ, is 8.1% of NAV and the
leading branded jewellery retailer and gold wholesaler
in Vietnam. It rose 30.5% and delivered 56.5% revenue
growth and 48.0% prot growth in the second half of
the nancial year, as people resumed their retail lives
with renewed vigour after the tough lockdown of 2021.
Although we pivoted to an underweight position in banks
in this nancial year, taking prot after last year’s stellar
performance, there are still four banks in our top-ten, and
the largest, Sacombank, STB, 5.6% of NAV, was down
29.7% but continues to deliver strong core prot growth
on a very undemanding valuation of 1.1x price to book. See
Top Five Portfolio Companies
on pages 16 to 20 for more
information. Overall, 14 of our 24 positions increased in
value and 10 decreased.
Post-COVID-19 Recovery
During the rst part of the nancial year Vietnam
experienced strict lockdowns and quarantine measures
in the battle against the COVID-19 Delta variant. From
a near-standing start last year, Vietnam succeeded in
rolling out a rapid vaccination program that saw close
to 100% of some city dwellers and 90% of the entire
adult population receive two vaccinations. This enabled
the government to relax COVID-19 restrictions in April
2022 and then remove them entirely in May, which led to
a resurgence in the economy. In the last quarter of the
Company’s nancial year, April to June, Vietnam posted a
staggering 7.7% YoY GDP growth, exceeding expectations
and ranking signicantly higher than other nations around
the world including in the G20 area which rose by only
0.7%
2
. Vietnam’s continued ‘broad-based recovery’ post-
7
Strategic ReportAnnual Report 2022
Investment Portfolio Average Portfolio Value Decreasing
The portfolio value of investors shows a declining trend after 4 rounds of survey, with the proportion of ‘Less than 50M’
portfolio increasing, while shares of portfolio over 100M, especially over 500M value drop quickly in latter waves.
COVID-19 has led some international nancial institutions
to upgrade their growth forecasts for it for the rest of 2022
as dierent sectors in the country regain pre-pandemic
momentum. Both HSBC and Singapore-based United
Overseas Bank, for example, recently raised their Vietnam
growth forecasts for 2022 to 6.9% from 6.6% and 7.0%
from 6.5%, respectively, according to the banks’ market
reports
3
.
Vietnam’s growth this year is noteworthy given record
rising ination and other unprecedented disruptions
aecting trade and investment worldwide. Despite today’s
intense global risk landscape, the country’s manufacturing
sector managed to expand for the ninth consecutive
month in June. In addition, new orders rose further and
production capacity continued to improve. Disbursed FDI
also hit record highs during the rst half of 2022 reaching
USD 2.9bn in June, the highest monthly amount this year.
Looking ahead, as Vietnam’s handling of the pandemic
pays o, we expect the full reopening of economic
activities to continue to boost investment initiatives and
feasibility assessments for new projects in the second half
of 2022.
Rise of the Retail Investor
As we reported in the Interim Report, as part of our rigorous
market analysis, in 2021 we commissioned an independent
8
What’s the approximate value of your actual stock investment?
Less than 50m 50-100m 100-500m More than 500m
3
Source: https://en.baochinhphu.vn/hsbc-upgrades-viet-nams-gdp-
forecast-to-69-in-2022-111220706162459626.htm
https://www.uobgroup.com/web-resources/uobgroup/pdf/research/
QGO-3Q2022.pdf
research rm to conduct a rst of its kind survey on the
sentiment and behaviour of the growing retail investment
base in Vietnam. This emerged as the driving force of
the equity market in Vietnam over the pandemic years,
as digitalisation of the onboarding process for domestic
investors, ‘e-KYC’, enabled close to 1.2 million Vietnamese
to open trading accounts during the calendar year. In the
rst half of 2022 a further 1.8 million domestic accounts
have been opened. In May alone 476,000 accounts were
opened, the highest number in the stock market’s 20-year
history.
In May 2022, we launched the fourth and nal phase of the
survey. 70% of the survey’s fourth phase respondents in
May 2022 were F1+ investors – investors who started trading
a year before the survey’s launch. The remaining 30% were
F0 investors, those who started trading within the past 12
months. Most respondents throughout the four phases were
white-collar oce workers based in Hanoi or Ho Chi Minh
City with an average individual monthly income of roughly
USD 1,000. Interestingly, in the fourth part of the survey we
found that the average amount invested in stocks dropped
by USD 2,000 lower than the USD 9,900 average recorded
over the previous 10 months, and about 30% lower than the
start of 2022. This corresponds to the 30% drop in average
daily trading volumes seen across the Ho Chi Minh City
(“HOSE”) stock exchange over the last six months.
12%
28%
24%
35%
Total
$US 9,900
Aug 2021
17%
20%
35%
28%
$US 18,000
Nov 2021
11%
21%
40%
28%
$US 9,100
Jan 2022
21%
19%
15%
46%
$US 10,400
5%
28%
31%
36%
$US 7,200
May 2022
Strategic ReportAnnual Report 2022
Market Trends
During the rst three surveys, 70-80% of investors had recorded gains; in the last survey most were nursing losses.
Rise of the Retail Investor (continued)
In general, how much of your portfolio changed since Jan 2021 / 2022?
Loss
Stable
Gain
The global and local decline in equity prices over the last
six months has muted investor condence in several
sectors, including banking, insurance, building materials,
logistics, transportation, petroleum and oil, real estate,
and securities. The retail investors’ view of securities is
particularly gloomy with just 7% of respondents considering
investment in securities, compared to a much higher 47%
in August 2021. This trend can be linked to a string of recent
high-prole scandals involving real estate corporations and
stock market manipulation, along with tightened capital
controls on the real estate sector.
Many of the new investors are possibly waiting on the side-
lines, and perhaps waiting for clearer direction signals from
the global economy with 42% of recent respondents sharing
that they are waiting to invest further compared to just 19%
in the rst survey back in August 2021.
Nevertheless, despite these uctuations, investors remain
upbeat about their returns after one year of investing.
Across the four surveys, more than 40% of respondents
expect returns of between 11% - 20% and close to 40%
expect returns of 20% -50%. When it comes to deciding
whether to invest, estimation from market value and market
index trends were the two most important sources across
the surveys, with analysis from securities companies and
company nancial statements also frequently used. One
constant across the four surveys is the high frequency with
which investors check the stock market index. Over 80% of
respondents said they check the market at least daily and
many check it several times per day.
Investment Manager’s Report (continued)
What is clear from these surveys is that regardless of the
market uctuations in Vietnam’s stock market, retail
investors will remain a key source of market movement.
Liquidity
Eighteen months ago, the HOSE infrastructure struggled to
cope with orders beyond USD 700m a day. Quick xes to
the system and some interim software upgrades expanded
the capacity, and due to the rise of the retail investor (see
“
Rise of the Retail investor
”) above daily volumes surged
to more than USD 1.3bn, ve times the levels of 2019. The
HOSE infrastructure is now in the process of being totally
revamped, with faster settlement and greater capacity
coming ever closer.
Increased market liquidity in 2021 facilitated swift funding
for last year’s tender oer for 30% of the Company’s shares.
Despite a 30% reduction in daily liquidity over the last few
months of the nancial year, the portfolio liquidity remains
robust and 90% of the portfolio could be liquidated in less
than 30 days.
The portfolio’s size and nimbleness as per our style of
investment management means that we can navigate
across the spectrum of company sizes, and we believe this
has contributed to the outperformance of the Company
versus the index and peers. We have been able to take prot
in sectors that surged last year and move swiftly as market
forces and economic mood changes.
The Fund is 70% invested in Large Cap stocks, above USD
Total
35%
20%
46%
Nov 2021
4%
17%
79%
7%
15%
79%
Aug 2021
6%
24%
70%
Jan 2022
22%
68%
10%
May 2022
9
Strategic ReportAnnual Report 2022
10
1bn in market capitalisation, and these have outperformed
the small and mid-cap stocks for much of the year. Last year
we noted an interesting inversion in the relative valuations
of smaller stocks, driven in part by increased attention from
the growing domestic retail investor base. Three years ago,
the smaller cap stocks, as measured by the VN70 index,
traded at a P/E ratio level around 30% lower than the larger
cap stocks, as measured by the VN30 index. During 2021
the ratio inverted with the VN70 stocks trading at a 30%
premium to the VN30 index in March 2021. In the year ended
30 June 2022, the ratio has inverted once more, with the
mid and small-caps sold o and now trading at a discount
to the larger-caps.
As of 30 June, the portfolio has about 6% in cash, which
is slightly higher than the usual 2%-3%, but provides
some exibility in taking advantage of what we see as
undemanding valuations for companies that we know well.
Although the Fund’s investment policy does allow up to 20%
of the assets to be invested in unlisted or pre-IPO ‘Private
Equity’ type deals, the Fund is currently only invested in listed
securities and all are valued as ‘Level 1’ refer to the
Fair Value
Information
in note 12 of the nancial statements pages
67 to 68. We see this as a reection of the opportunity set
now and believe liquidity has a premium that is not always
reected in the pricing of private deals. Lastly, we are aware
that the Fund has a formal continuation vote in 2023, and
we wouldn’t want to set false expectations in the minds of
potential investee companies, nor do Board or shareholders
in the Company wish the disservice by tying their hands to
a signicant illiquid position should the continuation vote
not pass.
Resilient Macro
Resilience in the face of adverse conditions is an ongoing
theme in Vietnam. Not only did Vietnam maintain an
enviable level of economic GDP growth of approximately 3%
per annum through the pandemic years, but also economic
growth has resumed to pre-pandemic levels quickly.
Vietnam has seen resilient Foreign Direct Investment (“FDI”)
disbursement, USD 19.7bn in 2021 and USD 10.6bn for the
rst six months of 2022. Vietnam has remained a very
open economy, and its overall trade reached more than
USD 668bn in 2021, representing more than 200% of GDP –
levels seen by only a few countries globally. The country has
maintained its strong export growth during the rst half of
2022, increasing by 17% year-on-year, and although import
growth was 16% year-on-year, the country managed to
generate a Trade Surplus of USD 710m. Retail sales also have
recovered strongly from the lows of the pandemic period,
and in June 2022 were 27% higher than the previous year.
The country now has foreign reserves of more than USD
100bn. This is down 10% in the rst half of 2022 as the State
Bank of Vietnam has intervened in the foreign-exchange
market to provide some stability. It is worth noting that
the Vietnam Dong has been relatively stable against the
USD over the last ve years, particularly when contrasted
against some other regional currencies (see “
Figure 1.1”
below). However, in the rst half of 2022 as the USD
strengthened, the Vietnam Dong weakened by 2.6%. This
should be looked at in the light of much sharper declines
in several global currencies including the ‘safe-haven’ Yen,
which has fallen by 20%, and the Euro and Sterling, which
are both down by about 10%. Often, a weakening currency
can have inationary pressures, however, Vietnam runs
a USD 40bn trade surplus with the US (a strengthening
currency), a USD 28bn trade decit with China (whose
currency has weakened by 3.3% against the USD) and a USD
18bn trade decit with South Korea (whose currency has
weakened by 7% against the USD), so in this regard there
is some natural hedging. On a broader front, ination is
increasing in Vietnam and Core CPI rose to 2% year-on-year
in June 2022 (see “
Figure 1.2”
below). That said, ination is
not at the worrying levels seen in the US, UK and Europe,
in part due to the dierent driving forces in the economy
(see “
Figure 1.3”
below). An important dierentiating factor
between Vietnam and some other emerging economies is
in the energy mix. Vietnam’s domestic renewable sources
of energy – hydropower, solar and wind – account for about
43% of its energy generation. It also has some domestic
sources of Oil, Gas and Coal, however it is a net importer of
each of these sources of hydrocarbon.
Figure 1.1: The Vietnam Dong has been relatively stable against the US Dollar over the past 5 years
20%
15%
10%
5%
-5%
-10%
0%
Jun 17 Aug 19Mar 18 May 20Dec 18 Jan 21 Oct 21 Jun 22
Thailand MSCI EM
Vietnam
China
Philippines
Strategic ReportAnnual Report 2022
Investment Manager’s Report (continued)
Figure 1.2: Ination is picking up in Vietnam, but is still at manageable levels
Figure 1.3: Vietnam is still an emerging economy, with dierent components to its consumer price index
Responsible Investing
The Company is rmly focused on sustainability and has
placed environmental, social and governance (“ESG”)
principles at the heart of its investment criteria for over a
decade, having become an early signatory to the United
Nations Principles for Responsible Investing (“PRI”) in 2009.
The Company received top grades in the report in 2020, the
most recent year for which scores have been published by
PRI.
Each part of ESG is equally important. For Vietnam, the ‘S’
has been at work in its society for many decades and the
pandemic has further focused the eorts of several of our
portfolio companies on harmonising sta, shareholders
and society at large. ‘G’ has been a key pillar for VNH’s
investment approach and we have been at the forefront
of advocacy and training for corporate governance at our
investee companies since we were formed 16 years ago.
Our CEO, Vu Quang Thinh, is a co-founder and member of
the board of the Vietnam Institute of Directors (“VIOD”),
working as a lecturer for VIOD courses and at other
institutions about how to improve corporate governance
standards in Vietnam. We actively encourage our portfolio
companies to give more attention to investor relations and
transparent reporting and have also been advising some
of them specically on how to get the balance right in
aligning interests between sta and shareholders through
the structure and implementation of employee share option
plans. The ‘E’ aspect of ESG has rightly so taken centre
stage in many investors’ minds as well as those of many
Vietnamese. On the climate front, the Investment Manager
and the Company have both armed the Paris Agreement
and our commitment to the Task Force for Climate-related
Financial Disclosure. Dynam Capital has also joined the Asia
Investor Group on Climate Change (“AIGCC”) and intends to
contribute more to the advocacy of climate risk reporting.
More details of this can be found in the
Sustainability Report
.
Positioning and Core Themes
During the year, we sold 11 positions and added new
12 positions. We exited a few smaller companies and
selectively added to our positions in larger companies,
Resilient Macro (continued)
4%
3%
2%
1%
0%
Jun 21
Jul 21
Aug 21
Sep 21 Oct 21 Nov 21 Dec 21 Jan 22 Feb 22 Mar 22 Apr 22 May 22 Jun22
CPI (YoY)
Core CPI (YoY)
3.37%
1.98%
US Vietnam
Transport & Energy
Food away from home
Housing, energy services
& construction materials
Food at home
Beverages & tobacco
Others
30.3% 35.2%
19.5% 9.7%
7.3% 25%
35.4% 18.8%
5.1% 8.6%
2.3% 2.7%
11
Strategic ReportAnnual Report 2022
12
have written in previous reports about the multiplier eect
of investments in domestic infrastructure. In May 2022,
a new bridge across Ho Chi Minh City’s Saigon River was
opened, and a short drive or walk across it connects down-
town District 1 to the Thu Thiem peninsular, a region already
demarcated to be a new ‘metropolis’. Developments like
this can lead to a dramatic growth in the build-out of
commercial and residential real-estate. The Company has
14.9% exposure to the dynamic real-estate market through
its real-estate portfolio that includes 5.4% of NAV in Khang
Dien House.
Domestic Consumerism
Vietnam’s ‘middle income’ population is projected to
expand at a rate of 18%
2
annually, adding a further
35 million people to this group of consumers by 2030.
The nature of the consumer continues to evolve. In the
1990s, for a brand to be really successful it had to be
foreign and manufactured overseas. By the 2000s, locally
manufactured global brands continue to dominate,
however, several niche local brands developed locally and
owned by Vietnamese businesses in sectors ranging from
shampoos, soft drinks, sauces and condiments to baked
goods and coee started to garner strong local appeal. In
a recent survey, it appears that in the 2020s Vietnamese
consumers now prefer and trust home-grown brands over
foreign brands.
The portfolio has approximately 17.8% exposure to the
domestic retail sector, including PNJ, 8.1% of NAV, and
Mobile World Group (“MWG”), 9.2% of NAV. The physical
retail components of both these companies will be
impacted by prolonged lockdowns, however, the digital
online portions of these businesses are performing
extremely well. These well-managed businesses have
emerged from the pandemic with greater market share,
and in the case of PNJ are seeing same store growth and
new store growth at levels higher than pre-pandemic.
Banks
VNH’s allocation to banks was reduced from 31% at 30 June
2021 to 22% at 30 June 2022. Our underweight position,
the index is at 33%, was due to prot-taking in the sector
in the second half of 2021 following the signicant gains
booked in the previous nancial year. Vietnamese Banks
are still benetting from resilient Net Interest Margins
(“NIM”), though they face controls on credit growth by the
State Bank of Vietnam (“SBV”) which issues a ‘quota’. Key
portfolio names in the portfolio include Sacombank, 5.3%
of NAV; MBB, 5.3% of NAV; VP Bank, 4.6% of NAV; ACB,
2.8% of NAV; and Vietin Bank (“CTG”), 2.4% of NAV.
1
https://population.un.org/wup/Publications/Files/WUP2018-Highlights.pdf
2
http://vids.mpi.gov.vn/Includes/NewsDetail/12_2016
dt_11220161027_9781464808241.pdf
taking prot from a portion of our portfolio of banks,
which had risen by close to 100% in the previous year, and
taking prot from Hoa Phat Group, a leading steel maker
which had also doubled in value the previous year.
Our main investment approach remains focused
on: industrialisation (best-in-class manufacturers,
international logistics); urbanisation (purposeful real
estate, transportation, clean energy and clean water);
and domestic consumption and its enablers (sustainable
retail, domestic logistics, products and finance).
These themes are inter-linked, as industrialisation and
urbanisation foster further robust growth in GDP and
domestic consumption, and are all underpinned by the
banking sector.
Industrialisation
Vietnam’s pace of industrialisation continues to
progress as it has done dramatically over the past three
decades. Last year, Vietnam overtook Bangladesh to
become the second largest garment producer in the
world. It is also very well-known as a major producer of
footwear, furniture, agriculture, and aquaculture, and
less well-known but an increasingly key supplier of hi-
tech hardware and software to customers around the
world. Recently on a visit to the US, the Vietnamese
Prime Minister met with the CEOs of several large
global technology companies, including Apple and
Intel, who re-affirmed their plans to produce more
goods in Vietnam. Although Apple does not have its
own facilities in the country, it is umbilically linked to 35
key manufacturers who are present. Following the PM’s
visit, Apple announced it was moving more production,
including the assembly of iPads, to Vietnam.
Although in the past we have invested in manufacturers,
including garment companies and seafood producers,
we have chosen to obtain most of the exposure to these
themes during the past year through the business-to-
business ‘linkages’, mainly through industrial parks
and logistic companies. These typically have a higher
quality of earnings and higher return on equity than
the individual exporters. A core holding in this area is
the leading shipping company Gemadept (“GMD”),
which at 8.5% NAV is the third largest position.
Urbanisation
Despite delays in domestic infrastructure expenditure
(the 2022 disbursement level is behind plan) and delays
to Vietnam’s metro systems becoming operational (the
HCMC metro is likely delayed by a further year until
2023) – the pace of urbanisation is a fast one. Vietnam’s
urbanisation level in 2018 was about 36%, the level of
Western Europe in 1945. According to a forecast
1
, its
urban population is expected to reach 44% by 2030. We
Strategic ReportAnnual Report 2022
Investment Manager’s Report (continued)
1
Source: https://www.imf.org/en/News/Articles/2021/03/09/
na031021-vietnam-successfully-navigating-the-pandemic.
2
Source: https://vietnamtourism.gov.vn/en/post/17504
3
Source: https://www.economist.com/emerging-market-
indicators/2004/02/12/country-risk
Outlook
As we move into the second half of 2022, the global mood
remains weak. Although recessionary risks remain less
severe for Asia than the West, a global recession would hit
Vietnam’s export growth in 2023 and we will be watching
the implications closely, including how policy directions
and actions unfold. Trade is key to Vietnam’s economy,
especially given its more prominent place on the global
supply chain map – the country posted a trade surplus
of over USD 700m in the rst six months of 2022. A
global recession would not only weigh in on the country’s
impressive exports and production growth but could
also impact its banking sector. On the positive front, the
domestic economy may benet from an increased amount
of government spending on infrastructure, which has
been under-budget in the rst half of 2022. Infrastructure
expenditure has a multiplier eect on economic growth,
including accelerating the pace of urbanisation, and
leading to a growth in real-estate development and the
growth in modern trade. Agile policy making will be as
important as ever. As the IMF recently reported
1
Vietnam’s
handling of the pandemic and associated risks helped the
country get through the last two years, particularly its
remarkable vaccination rollout, so with rising retail sales,
improving industrial production, and increasing foreign
investment, there’s a lot to consider when it comes to
Vietnam’s monetary policy and economic growth as the
world evolves.
There are encouraging signs in the rebound and growth of
domestic tourism in Vietnam, with 60 million trips made
in the rst half of 2022, 40% higher than the number
made pre-pandemic
2
. In May the remaining restrictions
and protocols put in place because of COVID-19 were
lifted, and international visitors started to return. As the
Chairman mentioned in his Statement, the Board of the
Company were able to visit the team in Vietnam in June
and see the post-COVID-19 recovery for themselves.
North Asia has historically been a key source of
international tourism for Vietnam, and many of those
countries are still imposing restrictions on travel for their
residents, particularly China, Taiwan, and Japan. We
expect people in the region would like their travel habits to
normalise, though increased costs of international ights,
disruptions at airports, and rapid growth in demand will
bring about their own issues on the industry.
Many emerging and frontier markets are facing extremely
testing times, mostly because of imported ination and
supply chain disruptions. This can ow into the lives of
populations in other ways as unrest forces changes in
governments, although developing countries do not have
a monopoly on this behaviour.
The Economist
3
listed the
countries that are most at risk, and Vietnam was not
among them. Vietnam is still growing at high levels –
back on its 30-year trend of 6.5 to 7% GDP growth. While
ination will increase, the forecast levels of approximately
4% do not look likely to cause nancial distress.
The war in Ukraine has obviously had a horric direct
impact in the lives of millions of its citizens through
loss of life, loss of home and livelihood. The shadows
of war have stretched further as the loss of Ukraine’s
grains and fertiliser exports stress global food supply,
and curtailment of Russian gas could threaten Europe’s
energy security, particularly once the 40-degree Celsius
summer fades into memory. One consequence of this is
the possibility that European countries will reduce their
energy consumption, leading perhaps to a change in
consumer and industrial demand and possibly favouring
importing nished products with cheaper overseas energy
cost ‘baked-in’ rather than intermediate goods that need
energy-intensive processing. Another consequence is that
countries, such as Germany that have typically favoured
renewable energy sources, will be forced to turn on more
coal red power stations. This will add fossil-fuel to the
re smouldering in some people’s minds that COP-26’s
pledges of ‘Net-Zero by 2050’ were unrealistic.
There is also an undercurrent of backlash against the
emergence of ESG themed investments and sustainability-
linked investment policies. This began as some concerns
were raised on ‘Green-Washing’ by certain global asset
managers but may also have found resonance with certain
industry leaders who question whether a CEO should ‘play
God’ in relation to moral and ethical considerations related
to nance. There is a danger that the baby is thrown out
with the bathwater, even at such an early stage of greater
awareness of ESG, and particularly the climate aspects, as
parts of the world face unprecedented and dangerously
high daily temperatures. The Investment Manager is of
the opinion that responsible investing matters even more
during these times of global uncertainty. The Company
has been a signatory to the United Nations Principles for
Responsible Investing for over 12 years, three quarters of
its life so far, and has set itself the task of ‘Doing More,
Measuring More and Reporting More’ on ESG issues. In 2021
the Fund’s Board pledged its own allegiance to the Paris
Agreement and commitment to the TCFD in addition to
becoming a member of the Asia Investor Group for Climate
Change (“AIGCC”). The portfolio’s carbon footprint is also
60% lower than the VNAS index. This has been a result of
the Fund’s active management style in sector allocation
13
Strategic ReportAnnual Report 2022
14
and selection of best-in-class companies. We report on
our enhanced work related to the climate aspects of the
portfolio in the
Sustainability Report
.
As mentioned in last year’s annual report, while our focus
remains on industrialisation, urbanisation, and domestic
consumption, we also will be eyeing emerging themes
coming out of the pandemic. We are seeing, rapid moves
in digital transformation in Vietnam and are adding to
our ‘category killer’ stocks with ‘rising stars’ that may
be beneciaries of further digital initiatives. Some of
these include retailers focussing on digital consumer
electronic lifestyle products and services, and some are
part of the infrastructure for 5G and other technological
developments. Our aim is to position the portfolio for
growth within a three to ve-year investment horizon.
As always, this means looking through short-term noises
and volatility in search of longer-term value derived from
robust compounding growth of well-managed companies
with proven sustainable business strategies.
Strategic ReportAnnual Report 2022
FPT Corporation
Vietin Bank
Hoa Phat Group JSC
VP Bank
Military Commercial Bank JSC
Vinhomes
Mobile World Investment Corp
Phu Nhuan Jewelry JSC
Khang Dien House
Sacombank
Total
FPT Corporation
Mobile World Investment Corp
Gemadept Corp
Phu Nhuan Jewelry JSC
Sacombank
Khang Dien House
Hai An Transport & Stevedori
Military Commercial Bank JSC
Vietnam Prosperity JSC Bank
Vietnam JS Commercial Bank F
Total
Top 10 companies as at 30 June 2022
Top 10 companies as at 30 June 2021
Sector
Sector
% NAV
% NAV
Ten Companies by NAV as at 30 June 2022 (and as at 30 June 2021)
Telecommunications
Retail
Industrial Goods and Services
Retail
Banks
Real Estate
Industrial Goods and Services
Banks
Banks
Banks
11.5%
9.2%
8.5%
8.1%
5.6%
5.4%
5.4%
5.2%
4.6%
4.0%
67. 5%
Telecommunications
Banks
Industrial Goods & Services
Banks
Banks
Real Estate
Retail
Retail
Real Estate
Banks
11.0%
9.6%
9.4%
7.3%
6.4%
6.1%
5.0%
4.9%
4.6%
4.5%
68.8%
Dynam Capital, Ltd
30 September 2022
Investment Manager’s Report (continued)
15
Strategic ReportAnnual Report 2022
About the Company
Founded in 1988, FPT is a software developer that provides of a
range of IT and telecom services, including broadband internet.
As it is also a brand-name distributor and retailer of IT and
communication products, the company has held the leading
position in the local IT industry in Vietnam since 1996 and has
been applauded for its educational programs, which oer learning
activities spanning various levels for more than 74,313 people.
With 178 oces and branches across 26 countries, as of the end
of 2021, FPT has transformed itself from an IT services company to
an end-to-end digital transformation service provider. Its digital
transformation services’ revenue reached a record USD 237m
in 2021. The company also owns telecoms infrastructure with a
main North-South link, which has recently been upgraded from
copper wires to ber-optic cables, and today continues to focus on
expanding its overseas markets.
As of 31 December 2021, FPT was managing seven subsidiaries
and 37,180 employees, including 24,068 engineers and technology
experts.
Financial indicators
(as at 31 December)
VietNam Holding’s investment
Share information
20202021
Capital (USD million)
Revenue (USD million)
EBIT (USD million)
NPAT (USD million)
Diluted EPS (VND)
Revenue growth
NPAT grow th
Gross margin
EBIT margin
ROE
D/E
Date of rst investment
Ownership
Percentage of NAV
Internal rate of return (annualised)
Stock Exchange
Date of listing
Market capitalisation (USD million)
Free oat
Foreign ownership
10 December 2012
0.4%
11.5%
26.6%
HOSE
13 December 2006
4,062
84.4%
49%
339.6
1,292.3
199.5
191.6
4,120
7.6%
13.1%
39.6%
15.4%
25.0%
0.68
390.1
1,533.2
232.8
229.9
4,349
18.6%
20.0%
38.2%
15.2%
26.7%
0.94
FPT Corp (“FPT”)
As at 30 June 2022
16
Recent Developments
Despite Vietnam’s 2021 Covid-19 lockdown, FPT still managed to
post a strong nancial performance with revenue and prot after
tax of USD 1,533.2m and USD 229.9m, a growth of 18.6% and
20.0% YoY, respectively.
Technology sectors are the main contributor to its revenue and
prot before tax with the share of 58% and 44%, respectively.
Specically, the global IT services segment remains the key
driver of FPT’s performance, and the US market has shown a
particularly strong result with revenue growth reaching 52%
in 2021. Additionally, the newer revenue stream from Digital
Transformation services increased by 72% in 2021 – the highest rise
in the last four years.
Sustainability Strategy
FPT has developed a sustainable development orientation strategy
to ensure the balance of three factors: economic development,
community support, and environmental protection. In terms of
objectives and activities, FPT referred to Vietnam’s action plan to
implement the 2030 commitments for sustainable development
and GRI Sustainability Reporting Standards. In 2021, FPT deployed
the digital vaccination program – FPT eCovax – helping enterprises
ensure business continuity during the pandemic. FPT also spent
VND 69.5bn on activities to support Covid-19 prevention.
ESG Achievements
FPT places a strong focus on sustainability and has identied
eight of the UN’s Sustainable Development Goals (“SDGs”) that
the company can most directly engage with: Quality Education;
Gender Equality; Aordable And Clean Energy; Decent Work
And Economic Growth; Industry, Innovation, and Infrastructure;
Responsible Consumption And Production; Climate Action And
Partnerships For The Goals.
In 2022, FPT published its very rst environmental, social and
governance (“ESG”) report for the year 2021, further arming the
company’s commitment to help investors, shareholders and other
stakeholders access transparent information on its activities. FPT
has improved its gender equality in the workplace by increasing
the number of female managers and employees by 17.5% and
21.4% respectively. The company was also highly recognised for
its contribution to Covid-19 relief in Vietnam by opening the Hope
Boarding School for children orphaned during the pandemic.
ESG Challenges
FPT has set targets for building green oce buildings but has not
yet started measuring its total carbon emissions. In addition, as
human resources is a key success factor for IT companies today,
FPT will need to nd ways to attract and retain talent in the face
of industry competition.
Top Five Portfolio Companies
Strategic ReportAnnual Report 2022
About the Company
Established in 2004 with only one mobile phone store in Ho
Chi Minh City, MWG grew rapidly on the back of private equity
involvement prior to its listing in the middle of 2014.
As of December 2021, MWG owned 5,306, stores under six brand
names. These include: The Gioi Di Dong, mobile phone retail chain;
Dien May Xanh, consumer electronics retail chain; Bach Hoa Xanh,
grocery retail chain; Topzone, an Apple Authorized Reseller model;
Bluetronics, consumer electronics retail chain in Cambodia; and
An Khang, pharmaceutical retail chain. In 2021, MWG upheld
its position as the largest retailer in Vietnam with USD 5.3bn
in revenue and USD 210.7m in net prot. As of May 2022 per its
management, MWG had a 60% share of the domestic mobile
phone market, a 50% share in the consumer electronics market,
and a vision to occupy a 10% share in the USD 60bn grocery market
over the next few years.
As of 31 December 2021, MWG owned ten subsidiaries and employed
74,111 people.
Financial indicators
(as at 31 December)
VietNam Holding’s investment
Share information
20202021
Capital (USD million)
Revenue (USD million)
EBIT (USD million)
NPAT (USD million)
Diluted EPS (VND)
Revenue growth
NPAT grow th
Gross margin
EBIT margin
ROE
D/E
Date of rst investment
Ownership
Percentage of NAV
Internal rate of return (annualised)
Stock Exchange
Date of listing
Market capitalisation (USD million)
Free oat
Foreign ownership
11 September 2017
0.3%
9.2%
13.5%
HOSE
14 July 2014
4,495
76.5%
49%
196.3
4,702.5
226.0
169.8
5,676
6.7%
2.6%
22.1%
4.8%
28.4%
1.08
306.5
5,285.1
253.4
210.7
6,897
12.4%
24.1%
22.5%
4.8%
27. 3%
1.21
MWG JSC (“MWG”)
As at 30 June 2022
Recent Developments
In 2021, MWG posted net revenue of USD 5,285m and net prot after
tax of USD 210.7m, a growth of 12.4% and 24.1% YoY, respectively.
Despite the Delta outbreak, which led to the lockdown of Ho Chi
Minh City in the third quarter 2021, the Dien May Xanh chain
continued on as the key growth engine of the Company.
In addition, grocery chain Bach Hoa Xanh witnessed a 33% growth
in revenue, thanks largely to the opening of 233 stores in 2H2020
and 387 in 2021. However, as the same-store sales growth is at for
2021 it remains loss-making for the year as a whole. Nonetheless,
the company has been remodeling its store layout and operational
structure, and there are early signs of improvement in the rst
six months of 2022 with an expectation of a break-even point by
December 2022.
Sustainability Strategy
MWG’s sustainable development strategy puts its employees as
the rst priority, followed by customers and then shareholders.
The performance-linked ESOP programs of MWG has helped
retain talented people in the company for several years and has
motivated some of the company’s ambitious top managers to seek
penetration into new market segments. The company has a strong
focus on internal training and has 44 trainers conducting monthly
courses for its sta. In 2021, the average training time per MWG
employee reached 29.5 hours with an average satisfaction level of
an impressive 97.4% for these internal training courses.
ESG Achievements
MWG has made signicant progress in its ESG activities by
improving its Board structure, estimating and reporting its total
carbon emissions, and applying relevant energy-saving solutions
across its chain of stores. The company also disclosed more social
and environmental indicators in its 2021 annual report. In addition,
MWG received an HR award from Anphabe for best working places.
ESG Challenges
As many retailers in Vietnam are starting to build their brands
around sustainability concepts, MWG needs to be more receptive
to this trend and operate their store chains in a more eco-friendly
manner, including encouraging customers to reduce the volume of
single-use plastic bags. The company also needs to apply the GRI
standards in its sustainability report.
Top Five Portfolio Companies (continued)
17
Strategic ReportAnnual Report 2022
About the Company
Established in 1993 by the privatisation of a state-owned company,
Gemadept (“GMD”) operated as a maritime agent and freight
forwarder in its early days. After 29 years of operation, the
company has become one of the largest seaport operators in
Vietnam, owning a seaport system that includes dry bulk ports,
ICDs, river ports and now a deep-water port.
GMD’s seaports are in two main locations: the Hai Phong port zone
in the North and the Cai Mep- Thi Vai port zone in the South. In the
North, GMD owns Nam Hai port, Nam Hai Dinh Vu port, and Nam
Dinh Vu port – the latter of which is the biggest port with a designed
capacity of 1,000,000 TEUs per annum. Furthermore, in the South,
GMD now owns its rst deep-water port, Gemalink, with a design
capacity of 1,500,000 TEUs for Phase 1. The commencement of
Gemalink in 2021 marked a turning point for GMD to transform
itself into a deep-water port operator, which is expected to play a
more important role in the regional trade ows in Southeast Asia.
Recent Developments
Despite the Delta wave, GMD still recorded strong revenue and
prot growth of 22.1% and 62.3%, respectively, in 2021 thanks to
Financial indicators
(as at 31 December)
VietNam Holding’s investment
Share information
20202021
Capital (USD million)
Revenue (USD million)
EBIT (USD million)
NPAT (USD million)
Diluted EPS (VND)
Revenue growth
NPAT grow th
Gross margin
EBIT margin
ROE
D/E
Date of rst investment
Ownership
Percentage of NAV
Internal rate of return (annualised)
Stock Exchange
Date of listing
Market capitalisation (USD million)
Free oat
Foreign ownership
16 August 2019
1.6%
8.5%
35.2%
HOSE
06 May 2002
673
95.9%
46%
130.6
112.9
20.4
19.1
1,149
-1.0%
-27.9%
36.4%
18.1%
6.7%
0.29
129.5
137. 8
29.8
31.0
1,869
22.1%
62.3%
35.6%
21.6%
10.6%
0.27
GMD JSC (“GMD”)
As at 30 June 2022
18
the improvement of ports in Hai Phong. According to Hai Phong’s
port authority, GMD’s ports recorded a double-digit growth in
container throughput volume, mainly driven by Nam Dinh Vu port
in 2021. In 1H2022, they accounted for an 18% market share in
terms of container throughput volume in the Hai Phong port zone.
Gemalink port, the biggest deep-water port in its zone, is expected
to be the key growth driver for GMD over the next four years.
According to the Vietnam Seaports Association, Gemalink port
accounted for 25.3% of the market share in terms of container
throughput volume in the Cai Mep- Thi Vai port zone in the rst
ve months of 2022. This has been the fastest growing region in
Vietnam in terms of container throughput volume over the past
ve years.
Sustainability Strategy
GMD denes its mission as to promote economic ows and create
added value for the country, customers and partners through
a chain of outstanding services and solutions, in which ESG
factors are the core foundation for long-term development. The
management team has shown determination in developing a
feasible ESG strategy and roadmap for the company.
ESG Achievements
GMD outperforms its peers in Vietnam’s logistics sector when it
comes to ESG activities. The company has made a lot of eorts to
align its business with the UN’s 17 SDGs, especially SDG number 9
– Build Resilient Infrastructure: Promote Inclusive and Sustainable
Industrialisation, and Foster Innovation – with its extensive ‘green’
smart port ecosystem, as well as SDG number 13 – Climate Action
– with its many initiatives aimed at contributing to Vietnam’s
net-zero commitment. The company has a strong organisational
culture and an extensive training program for its employees.
ESG Challenges
GMD has not yet disclosed its total carbon emissions. Also, it
will take time and signicant expenditure for GMD to receive
international certicates for its entire ports and logistics system.
GMD also owns a non-core rubber plantation project in Cambodia
that is a potential ESG concern, however, in recent meetings with
the company, its senior management have re-conrmed their
intention to divest this project in 2023.
Strategic ReportAnnual Report 2022
About the Company
Established in 1988, PNJ is now the leading jewelry producer and
retailer in Vietnam with an estimated 56.5% market share in the
branded jewelry retail segment. Its vision is “to become a leading
jewelry manufacturer and retailer in Asia, to honour beauty and
reach a global market”.
In 2021, PNJ owned 342 stores across Vietnam under the brand
names of PNJ, CAO, PNJ Silver, and PNJ Style. In addition to its
nationwide distribution network, PNJ also operates two factories
in Ho Chi Minh City and Long An with a capacity of six million
jewelry items per year.
As of 31 December 2021, PNJ employed 6,473 people, of which
61.7% are female.
Recent Developments
2021 was a dicult year for PNJ due to the full-edged lockdown in
HCMC from June to October, which forced its shops to close. As a
result, the revenue ‘only’ increased by 10% while the NPAT dropped
by 4.5%. Nevertheless, PNJ demonstrated a remarkable recovery in
Financial indicators
(as at 31 December)
VietNam Holding’s investment
Share information
20202021
Capital (USD million)
Revenue (USD million)
EBIT (USD million)
NPAT (USD million)
Diluted EPS (VND)
Revenue growth
NPAT grow th
Gross margin
EBIT margin
ROE
D/E
Date of rst investment
Ownership
Percentage of NAV
Internal rate of return (annualised)
Stock Exchange
Date of listing
Market capitalisation (USD million)
Free oat
Foreign ownership
8 December 2009
0.8%
8.1%
30.8%
HOSE
23 March 2009
1,338
83.4%
49%
98.6
766.0
53.9
46.3
4,308
3.5%
-10.1%
19.4%
7.0%
21.8%
0.35
97.8
848.3
71.9
44.2
4,197
10.7%
-4.5%
18.2%
8.5%
18.3%
0.45
Phu Nhuan Jewelry JSC (“PNJ”)
As at 30 June 2022
the rst six months of 2022 with record-breaking revenues and net
prot of USD 782m and USD 46m, respectively. Retail jewelry is the
key driver of this stellar performance with a contribution of 58.6%
and an excellent growth rate of 61.9%.
Sustainability Strategy
Sustainable development is integrated in PNJ’s culture, activities
and business strategy, not least given its business philosophy of
“Integrate the customer and society benets into the company’s
interests”. In addition, PNJ’s focus on ‘green’ technologies
and projects – for example, by maximising its fuel economy
and participating in reforestation projects and clean water
development – has helped it become one of the top-10 sustainable
development businesses in Vietnam both in 2020 and 2021.
ESG Achievements
PNJ is the company with the highest ESG rating score in VNH’s
portfolio and is widely recognised for its eorts in improving its
ESG performance over the years. In 2021, the company created
an ESG committee as a sub-committee of its Board of Directors
and continues to demonstrate its ambition to be a leading ESG
advocate among public companies in Vietnam. The company also
won the top 100 Sustainable Companies in Vietnam awarded by
the Vietnam Council for Business Development in recognition of its
eorts to promote gender equality in the workplace.
ESG Challenges
PNJ has not yet disclosed its total carbon emissions. The company
also needs to further improve and disclose its material sourcing
material sourcing policy and develop a roadmap for becoming
certied as a member of the Responsible Jewelry Council.
Top Five Portfolio Companies (continued)
19
Strategic ReportAnnual Report 2022
About the Company
In 1991, STB became the rst commercial joint-stock bank to be
established in Ho Chi Minh City and in 1996 it became the rst bank
to issue shares to the public. By 2006 it was the rst commercial
joint-stock bank to be listed on the Ho Chi Minh Stock Exchange.
During the ve-year period from 2006 to 2011, the bank recorded
a compound annual growth rate (“CAGR”) of 34.5% in its net
prot and became one of leading private banks in the Southern
Vietnam. In 2012, however, it was subject to hostile changes in
the shareholders and management, followed by a merger with a
weak bank in 2015, which put the brakes on its rapid growth. After
six years of restructuring, STB has eectively dealt with most of
the consequent legacy issues and is accelerating the restructuring
process. In 2022, STB became the tenth largest bank by assets in
the industry and today runs the most extensive branch network
among private banks in the country with 566 branches and
transaction points. The bank’s net prots grew by a CAGR of 30.4%
from 2017 to 2021 and it is expected to enjoy signicant growth
over the coming years by which stage it is should have completely
resolved all its legacy issues. Despite many headwinds, STB
successfully implemented Basel II from January 1, 2020, showing
its commitment towards prudent risk management practices.
Financial indicators
(as at 31 December)
VietNam Holding’s investment
Share information
20202021
Capital (USD million)
Revenue (USD million)
EBIT (USD million)
NPAT (USD million)
Diluted EPS (VND)
Revenue growth
NPAT grow th
Gross margin
EBIT margin
ROE
D/E
Date of rst investment
Ownership
Percentage of NAV
Internal rate of return (annualised)
Stock Exchange
Date of listing
Market capitalisation (USD million)
Free oat
Foreign ownership
24 July 2020
0.4%
5.6%
1.6%
HOSE
13 July 2006
1,741
93.1%
22%
816.7
748.2
116.2
1,248
18.5%
9.7%
0.6%
9.6%
9.5%
1.6%
17.0
810.3
761.0
146.6
1,630
1.7%
26.2%
0.7%
10.8%
9.9%
1.5%
15.2
Sacombank (“STB”)
As at 30 June 2022
20
STB has won many accolades, including “
Best bank with foreign
currency service
” from Global Banking & Finance Review (UK),
“
Vietnam’s best bank for medium and small sized enterprises
” from
Asia Money, “
Vietnam’s bank with initiative in digital banking
”
from The Asian Banking & Finance, as well as “
Best Workplaces in
Asia in 2021
” from HR Asia.
Recent Developments
In 2021, STB’s consolidated NPAT increased 26.2% YoY to USD
146.6m, with total credit growing 14% YoY. Non-performing loan
(“NPL”) ratio improved to 1.5% of total credit from 1.6% a year
before, while the loan-loss-buer enhanced to 121% of NPLs from
94% in 2020. It has continued to prioritise bad debt handling, thus
the proportion of the legacy assets to total assets declined to 6.7%
in 2021 from 29.3% in 2016.
Sustainability Strategy
STB has pursued a sustainability-oriented corporate governance
model. This objective has helped the bank face diculties and
challenges in the past. In 2021, it continued to meet all the criteria
of the Corporate Sustainability Index (“CSI”) and was honored as
the Top 3 of the “most favorite public companies” of investors in
2021. STB has implemented environmental and social management
system (“ESMS”) in compliance with international standards.
According to Directive No 03/CT-NHNN on promoting green
credit growth, which was rst piloted for small and medium size
enterprises, STB was the rst private bank to implement this
program alongside three of Vietnam’s state-owned commercial
banks, including Vietcombank, BIDV and Agribank.
STB has been arranging loans with preferential interest rate
for individuals and enterprises whose business and production
activities either ‘cause no harm’ or ‘protect natural resource,
environment and society’. It has also coordinated with several
business associations to participate in specialised seminars (for
corporate customers accessing green credits) as well as more
modern bank products and services.
ESG Achievements
STB has improved its sustainability report by following the GRI
standards. In addition, the company’s Board of Directors has
created committees and councils in compliance with the law and in
reference to best practices on corporate governance. Furthermore,
the bank has documented its environmental and social risk
appetite and based on that developed a rigorous environmental
and social impact assessment process. The bank also has carried
out an employee satisfaction survey.
ESG Challenges
STB is aware of the national net-zero commitment and reports its
key environmental performance indicators in its annual report,
however, it could do better by estimating and disclosing its total
carbon emissions and consider the application of the Task Force
on Climate-related Financial Disclosures (“TCFD”) framework
to integrate climate into its governance and risk management
framework.
Strategic ReportAnnual Report 2022
2021 witnessed signicant changes in Vietnam’s policy
commitments towards a “clean, green and beautiful”
Vietnam. At the United Nations’ Climate Change
Conference in November 2021 (“COP26”), Vietnam’s Prime
Minister Pham Minh Chinh announced that the country
would pledge to achieve net zero carbon emissions by 2050
and phase out coal power generation by 2040. This strong
commitment could be seen as a milestone for Vietnam
paving a way for the transformational interventions
needed to address climate change challenges, including the
development of cleaner transportation and energy systems.
Since COP26, the government has taken rm steps in building
a legal corridor for responding to climate change issues
and implementing the commitments made. In particular,
is the government’s issuance of Decree No. 06/2022/ND-
CP on January 07, 2022, which includes regulations on the
reduction of greenhouse gas emissions and protection of the
ozone layer. This new legislation species how companies
will be given guidance on the scheme and undergo a pilot
operation that is followed by a carbon credit trading market
due to be formally launched in 2028.
Additionally, in June 2022, the government approved the
circular economy development scheme and set several
ambitious targets for the period ahead. The scheme aims
to reduce the intensity of greenhouse gas emissions per
GDP by at least 15% by 2030 and supports the net-zero
emissions target by 2050. By 2025, the country also aims to
reuse, recycle, and treat 85% of plastic waste generated,
thereby reducing 50% of the plastic waste in the seas and
oceans as well as that of the volume of non-biodegradable
plastic bags and disposable plastic products that are used
in daily life.
In regards to clean energy development, the draft National
Power Development Plan (draft PDP VIII) for the period
2021 to 2030, with a vision to 2045, has been revised
signicantly in terms of the mix of energy sources needed
to align with Vietnam’s commitment to be net-zero by
2050. The proposed structure includes 50.7% share of wind
and solar power and only 9.6% from coal power by 2045. If
Vietnam achieves the goal, it will reclaim its crown as Asia’s
renewable energy powerhouse.
As the fourth COVID-19 wave spread across Vietnam in
2021, we were able to witness how Vietnamese enterprises
made tremendous eorts to survive through the most
committed to do more, measure
more and report more.
Sustainability Report
dicult time of the pandemic. From quickly digitalising their
business operations to implementing the “3 on-site” model
at factories, as well as collaborating with the authorities by
organising mass vaccination programs for their employees
and making substantial donations to COVID-19 relief
activities. We consider these actions to be a great reection
of the “S” in environmental, social and governance (“ESG”)
activities in Vietnam. Indeed, it also shows how Vietnam is
regaining its reputation as a pandemic “success story” as it
climbed to second place in the Nikkei’s COVID-19 Recovery
Index in July 2022. The country has now fully reopened its
borders and we immediately saw increased trade and tourist
ows, as well as rising levels of foreign direct investments,
manufacturing outputs, and the rate of new construction.
In the second quarter of 2022, Vietnam’s GDP expanded
7.72% year-on-year, exceeding market expectations and
ranking signicantly higher than other nations around the
world, many of which saw their economies shrink due to the
war in Ukraine and all its implications.
VNH is a long-term, responsible investor, and ESG
integration lies at the heart of our investment philosophy.
We have been able to see the tremendous evolution of
ESG in the past ten years with a wide variety of metrics,
methodologies and approaches being tested and revised.
While earlier approaches used exclusionary screening and
value judgments to shape their investment decisions, ESG
investing has been changed over time by shifts in demand
from the nance ecosystem, driven by both the search for
better long-term nancial value and a pursuit of better
alignment with values and current socio- environmental
challenges
1
.
Also, we see particular interest in ESG coming from
millennials – the investors and decision makers of
the future who account for over a third of the global
population. According to a 2020 report on millennials
and ESG investing by MSCI, millennial investors have
contributed USD 51.1bn to sustainable funds in 2020,
compared with less than USD 5bn ve years earlier. This
momentum is expected to continue over the next decade
as 75m millennials inherit an estimated USD 30tn to USD
68tn from their parents.
Over the past year, we have navigated ourselves along the
ESG journey by looking at what we have achieved and what
we can do better, especially in terms of ESG assessments
and engagement with companies. We rened our ESG
policy and exclusion screening list and added more climate
change commitments. We also applied the Task Force
on Climate-related Financial Disclosures (“TCFD”) in our
reporting, developed our own ESG rating framework, and
engaged more with companies on ESG topics.
1
OECD, 2020
21
Strategic ReportAnnual Report 2022
ESG integration: Continuously improving the
quality of our in-house ESG research with a more
holistic assessment framework and ESG rating by
companies, with reference to specific industry and
sector guidelines;
Company engagement: Continue to make progress
in our engagement with companies on ESG
topics, tracking their achievements and initiating
collaborative engagement with other investors; and
Advocating the adoption of ESG standards and
best practices among the Vietnamese business
community, with a strong focus on improving
corporate governance, ESG reporting and identifying
appropriate decarbonisation strategies.
integrate ESG issues into every step of the investment
process: initial screening, due diligence, investment
decision making and monitoring;
provide a framework for monitoring and reporting on
ESG aspects to stakeholders; and
work in partnership with our portfolio companies to
help them identify and implement ESG opportunities,
creating sustainable enhancement to their overall
nancial performance.
Investors not only have the power but also a responsibility
as stewards to drive and help create change;
ESG research can provide unique insights not available
in pure fundamental approaches;
ESG integration leads to better-informed investment
decisions; and
Active ownership, advocacy, and engagement on ESG
issues can reduce the risk of value destruction.
ESG Management System
Our ESG Management System is a customised set of
policies, procedures, tools and reporting criteria designed
to identify, assess, manage and disclose information
on ESG matters. We use this to help us both choose the
right risks and take advantage of the opportunities that
they present. Furthermore, in considering the activities of
portfolio companies, we seek to ensure that our decisions
lead to more positive impacts.
The ESG Management System has been developed by our
Investment Manager to:
Climate Change and the ESG Agenda
According to the most recent report by the World Bank,
Vietnam’s 100m people are among the most vulnerable
in the world to climate impacts, facing hazards along the
country’s 3,260-km long coastline and extensive low-lying
regions. The country was estimated by the World Bank to
lose about USD 10bn in 2020, or 3.2% of its GDP to climate
impacts. By 2050, the costs to the economy generated
by climate change could total as much as USD 523bn;
therefore, investments to address climate impacts are a
priority.
At COP26, Vietnam made a strong commitment to
achieve the net-zero target by 2050, and since then the
government’s eorts in changing its energy strategies and
relevant policies have shown the country’s willingness to
address climate change issues. As a long-term investor
focusing solely on the Vietnamese market, we strongly
support the country’s government and business community
in addressing climate change and the socio-economic
eects. During the nancial year, our Investment Manager
has been actively contributing to the national and regional
dialogue on driving forward the net-zero transition. The
Investment Manager provided insights related to Vietnam’s
power sector for the report “
Power of ASEAN: Accelerating
clean energy in Vietnam and Indonesia
” published by
the Asia Investor Group on Climate Change, as we are a
member.
Through the Investor Climate Action Plans (“ICAPs”)’
Expectation Ladder and Guidance, which was co-created
with Asia Investor Group on Climate Change (“AIGCC”), we
were able to position ourselves in the race to net-zero for
investors and develop a pathway to progress in the mid to
long-term. Based on the ICAPs, in late 2021 we identied
ourselves to be between Tier 4 and Tier 3, as:
Our approach to ESG integration is based on the following
principles:
22
To advance our commitment to responsible investment,
we have identied key areas that we need to continue to
progress in the next year:
We have integrated climate risks into the overall
risk assessment framework and regularly monitored
portfolio climate risks;
We do not invest in companies with more than 25% of
revenues from fossil fuel; and
Our Investment Manager is a member of AIGCC
and has sent its sta on climate change training. By
June 2022, we have been able to move to Tier 3 by
conducting detailed scenario analysis for the portfolio
and assessing the physical and transition risks, using
these results to assist with for current and future
investment decisions. We believe VNH is now heading
towards Tier 2.
(i)
(ii)
(iii)
Strategic ReportAnnual Report 2022
Measure portfolio carbon
emissions.
Establish a formal policy on
integrating climate change into:
investment analysis
decision-making
investment manager
selection and appointment
Undertake portfolio climate risk
assessment.
Regularly monitor portfolio
climate risks including physical
risks.
Invest part of the portfolio in
2ºC aligned products.
N/A
Align portfolio emissions
reduction target with domestic
policy goals or NDCs.
Commit to increasing
investments in appropriate
clean energy and low carbon
opportunities.
Conduct a 1.5ºC and 2ºC
scenario analysis including
transition and physical
risks, using a recognised
methodology.
Revise and update this analysis
annually.
Invest part of the portfolio
in 1.5ºC aligned companies,
products, and projects.
Set Scope 1 and 2
decarbonization targets for your
own operational emissions.
Align portfolio emissions
reduction target with 1.5ºC and
global net-zero emissions by
2050.
Establish a formal investment
policy on fossil fuels and other
high impact activities, such as
deforestation and biodiversity
loss, that: aligns with a net-zero
target; includes an explicit
commitment to phase out
exposure to fossil fuels (either
through engagement or
divestment) in line with science-
based net-zero pathways; aligns
with just transition principles.
Develop and start implementing
a recognized option strategy for
at least one portfolio or asset
class.
Use scenario analysis and stress
testing to:
assess the impacts of physical
and transition risks on the
portfolio
inform current and future
investment decisions
Incorporate climate change
into strategic asset allocation
and invest in 1.5ºC-aligned
companies, products, and
projects in multiple asset
classes.
Implement explicit net-zero
aligned targets for clean energy
and low carbon investments in
each asset class.
Set Scope 3 decarbonization
targets if they are material i.e.
>40% of emissions of underlying
assets.
Align portfolio emissions
reduction target with 1.5ºC and
global net-zero emissions by
2050 or sooner. Set intermediate
targets covering all assets
every 5 years using recognised
methodologies and frameworks
for setting, assessing, reporting,
and verifying performance.
Eliminate all investments in
thermal coal, tar sands and
Arctic drilling.
Dene a strategy for all high
emitting sectors.
Explicitly incorporate net-zero
scenario analysis.
Invest (and grow the proportion
annually) in 1.5ºC aligned
companies, products, and
projects in all asset classes.
Set 1.5ºC targets in all assets
classes where recognised
methodologies exist. Establish
net-zero-aligned targets for high
impact sectors. Set intermediate
targets that enable progression
and assessment of portfolio
emissions reduction in line with
achieving net-zero emissions.
VNH is now moving from Tier 3 to Tier 2
Investor Climate Action Plans (ICAPs) Expectation Ladder
1
1
AIGCC, 2021
Climate Change and the ESG Agenda (continued)
Tier 4 Tier 3 Tier 2 Tier 1
Strategy
Risk Management
Asset Allocation
Additional Target Setting
Sustainability Report (continued)
23
Strategic ReportAnnual Report 2022
Continue to measure and track the portfolio’s carbon
footprint to identify carbon-intensive sectors and
integrate climate risks and opportunities into the
Company’s broader risk management framework;
Improve upon best-practice for climate related
disclosures for investment companies by following the
guidelines of the TCFD disclosures, even though VNH is
technically out-of-scope for this; and
Encourage more companies in the portfolio to
measure their total carbon emissions and consider a
decarbonisation roadmap.
24
Climate change is also a main topic for engagement with
companies in our portfolio. In support of the Government’s
Decree No. 06/2022/ND-CP on regulating GHG mitigation
and ozone layer protection, the Investment Manager
successfully hosted the webinar “
Heading Towards Net-
zero Targets and Corporate Strategies
” in March 2022 with
representatives from 70 companies and organisations in
Vietnam in attendance. Through the timely webinar, the
Investment Manager was able to keep portfolio companies
updated about the new legislations relevant to climate
change in Vietnam and provide them with technical
expertise to develop their own decarbonisation roadmaps.
The webinar received wide attention from both the
business and non-prot sectors, and in addition to its initial
objectives, was able to broaden the discussion to explore
how the Vietnamese business sector can contribute to the
national commitment of reaching net zero by 2050.
As we transition to a net-zero world, VNH has identied
three focus points for climate change over the next two
years:
VNH’s TCFD Report
This year we analysed the portfolio in greater depth in terms
of the physical and transition risks, and employed VNEEC,
a Vietnamese environmental consultant, to estimate total
carbon emissions of all listed investee companies as of 31
December 2021. This was followed by an assessment of the
portfolio’s climate risks including its alignment with the
Paris Agreement goals, which was based on a scenario
approach with implied temperature rise metrics. This
analysis provides a greater understanding of our portfolio
risk from a climate perspective, and is also useful for our
company engagement program. Our response to the core
elements of the TCFD recommendations are summarised
in the following sections.
Governance
In 2021, VNH’s Board announced its commitment to both
the Paris Agreement and the TCFD’s risk, governance
and reporting recommendations. During the Annual
General Meeting in 2021, the Board also endorsed a belief
statement for climate, which was later published through
media releases and via the Company’s website.
The Company’s ESG Committee has been working closely
with the Investment Manager to further develop its
investment strategy and incorporate climate-related risks
and opportunities into the investment process and risk
management.
Sustainability matters are incorporated in its reports to
investors. In addition, the Chairman of the ESG Committee
and the Managing Directors of the Investment Manager
have attended cross-industry seminars and training in
both UK and Asia on climate and sustainability issues,
where we have been advocating for greater adherence
and involvement from peers. The Investment Manager also
promotes and supports climate initiatives through industry
bodies such as, the AIC, the Vietnam Institute of Directors
(“VIOD”), the Singapore Institute of Directors and the
AIGCC.
Strategy
As Vietnam companies are at a very early stage to
incorporate climate change into their business strategies,
in the short to medium-term (2021 to 2025), we continue
to prioritise our engagement strategy to raise portfolio
companies’ awareness of climate risks and the energy
transition, as well as provide them with guidelines on how
to measure their total carbon emissions and adopt low-
carbon technology.
We identify the physical risks, for example, acute weather
events and transition risks, including policy, legal and market
risks, for the sectors and industries that surround our core
target investment themes. These include industrialisation,
urbanisation, and the domestic consumer. Within the
sectors and industries, we research, analyse, and prioritise
the best-in-class companies in terms of their adoption of
technology solutions to lower carbon emissions and the
provision of disclosures on carbon footprint in their annual
reports. We consistently favour companies exhibiting or
developing strong climate-resilient strategies.
As Vietnam companies are at a very early stage to
incorporate climate change into their business strategies,
in the short to medium-term (2021 to 2025), we continue
to prioritise our engagement strategy to raise portfolio
companies’ awareness of climate risks and the energy
transition, as well as provide them with guidelines on how
to measure their total carbon emissions and adopt low-
carbon technology.
Based on the heat map developed by the United Nations’
Environment Program Finance Initiative’s TCFD banking
Strategic ReportAnnual Report 2022
Strategy (continued)
program, which assesses the sector transition risk exposure in terms of direct and indirect emission costs, low carbon
capital expenditure and change in revenue of the majority of VNH’s portfolio in 2021 (59.1% of the NAV) is in sectors with
the “Moderate” impact rating. Additionally, 37.5 % of the portfolio in 2021 is allocated to financial services companies,
which fall under the Services and Technology category with the “Low” impact rating. In 2021, VNH did not allocate
any investment in the Oil and Gas and Power Generation companies, and thus was not exposed to any “High” impact
sectors.
In terms of implied temperature rise, based on the calculation of VNEEC, the 2021 portfolio of VNH is consistent with a
1.81°C temperature rise scenario and aligned with the fair share emission budget by the Climate Action Tracker. However,
the portfolio is not yet fully aligned with the domestic pathway in the net-zero by 2050 scenario that Vietnam is now
committed to.
Risk Management
The ESG Committee reports to the Board of the Company, and liaises with the Audit and Risk Committee and the
Investment Manager to incorporate climate risks into the overall risk management framework (see pages 28 to 30).
Climate risk assessment is integrated by the Investment Manager into all stages of investment processes: initial
screening, due diligence, investment decision and monitoring. The risks are regularly discussed during meetings of the
Investment Committee and the Investment Manager’s Board and are also regularly reported to the Company’s Board.
Risks are continuously identified and managed at the portfolio level.
Metrics and Targets
Portfolio carbon footprint
The portfolio companies’ attributable carbon footprints are analysed against the attributable footprint of an identical
invested amount in the companies of the VNAS. In 2021, the VNH portfolio had an estimated total annual emission of
9,059 tonnes carbon dioxide equivalents (“tCO
2
e”) from Scope 1 and 2. The carbon footprint of the portfolio in 2021 is
significantly lower when compared against the benchmark of an equivalent investment size in VNAS, with 67.5% or
18,803 tCO
2
e less total carbon emissions. The total carbon emissions of the Portfolio in 2021 is also much lower than that
of Portfolio in 2020 (9,059 and 21,045 tonnes of CO
2
equivalents, respectively). This positive performance was resulted
mostly from effective sector allocation, with a small contribution from stock selection.
Sustainability Report (continued)
The Portfolio carbon footprint is the key metric used to measure and track progress towards reducing carbon emissions.
Our target is to keep the portfolio carbon footprint 20% below the Vietnam All share Index (“VNAS”).
We will join in collaborative engagement initiatives to hold the rise in global average temperature to below 2 degrees
Celsius above pre-industrial levels. The target is measured by the number of climate initiatives that we support through
communications, policy dialogue, company engagement, and networking.
In 2022, we have conducted deeper quantitative analysis to assess the climate risk exposure of the portfolio, using a
scenario approach for implied temperature increases to estimate the nancial impacts and estimate how these risks
are translated into nancial impacts, for example, the potential nancial loss from physical risks, carbon pricing and
the impacts on corporate prots.
We will also identify businesses and investment opportunities that may benet from the transition risk process.
In the longer-term (from 2025 onwards), and with shareholder approval, we will set a rm target percentage in our
portfolio for low-carbon investments.
Total Emissions Scope 1 and 2 (tCO
2
e)
Total Emissions Scope 1, 2 and 3 (tCO
2
e)
Carbon footprint (tCO
2
e/ $M Invested)
Dierence between
VNH Portfolio vs.
VNAS benchmark
VNAS benchmark
VNH Portfolio
9,059 27,8 61 -18,803
21,042 57,0 50 -36,008
58.21 179.03 -67. 5%
25
Strategic ReportAnnual Report 2022
Sustainable Development Goals
The 17 Sustainable Development Goals (“SDGs”), also known as the Global Goals, were adopted by the United Nations in
2015 as a universal call for action to end poverty, protect the planet, and ensure that by 2030 all people enjoy peace and
prosperity. With only less than a decade left to meet the SDGs by 2030, it is crucial to accelerate actions to achieve the
Goals. It is increasingly clear that the way forward is one that must be paved by both businesses and governments. The
growing power of the business sector should be leveraged to grow a stable, sustainable global economy and society.
We consider the 17 SDGs to be a useful framework that companies can use to start to develop their sustainability and ESG
strategies. We are pleased to see that the SDGs have been incorporated in many of our portfolio companies’ annual reports,
with detailed illustrations of how the SDGs are embedded in their vision, business strategies and operational conduct. FPT,
the largest holding in VNH’s portfolio is contributing greatly to SDG 4 – Quality Education – with their extensive education
programs. In its 2021 annual report, FPT also pointed out the eight SDG goals that the company most directly contributes to:
Quality Education; Gender Equality; Aordable and Clean Energy; Decent Work and Economic Growth; Industry, Innovation,
and Infrastructure; Responsible Consumption and Production; Climate Action, and Partnerships for the Goals.
Gemadept (“GMD”), another of the Top 5 portfolio companies, has also made considerable eorts to align its business
with SDGs, especially SDG 9 – Build Resilient Infrastructure, Promote Inclusive and Sustainable Industrialisation and Foster
Innovation – with its extensive “green, smart port” ecosystem. It also is focusing on SDG 13 – Climate Action – and is working
on many initiatives aimed at contributing to Vietnam’s net-zero commitment.
VP Bank, arguably the “greenest” bank in our portfolio, has made signicant eorts to improve its environmental and social
management strategy by following international standards and starting to apply the TCFD framework to its processes. In
2021, VP Bank helped 422 customers to integrate sustainability into their business or invest in a “green” project involving
renewable energy, waste treatment, or clean transportation, for example. It ended the year with a total Green Loan
balance of VND4,066bn, equivalent to around USD170m. Meanwhile, Phu Nhuan Jewelry (“PNJ”) is making much progress
in integrating SDG 5 – Gender Equality – into its management approach by raising awareness about the role of women in
families and the workplace.
Among our portfolio companies, CTG, FPT, MBB, PNJ, and VPB are included in the Vietnam Sustainability Index (“VNSI”)
2022, which features the top 20 sustainable listed companies on HOSE measured in terms of their ESG contributions.
VCS, DGW, PNJ and CTG are the companies in the top 100 sustainable companies in Vietnam based on the Corporate
Sustainability Index developed by the Vietnam Business Council for Sustainable Development (“VBCSD”) under the Vietnam
Chamber of Commerce and Industry (“VCCI”).
Corporate Governance
During the past two decades, the Law on Enterprises and the Law on Securities has been updated several times, with
the latest versions being passed during 2019 and 2020 and eective from 1 January 2021. Decree 155, covering corporate
governance of public companies, and Circular 96 on the disclosure of information of public companies, are the two key
implementing regulations of those laws, and were issued around the same time. These laws and regulations form the main
part of the prevailing Vietnamese corporate governance regulatory framework. In addition to mandatory rules provided in
the laws and regulations, the State Securities Commission (“SSC”), with support from the International Finance Corporation
(“IFC”), and with inputs from the Investment Manager’s CIO, issued in summer 2019 the Vietnam Corporate Governance
Code of Best Practices for public companies (the “CG Code”), which recommends standards that go beyond the minimum
legal and regulatory requirements. The CG Code will also help Vietnam align with its ASEAN peers, which have already
instituted similar codes.
In anticipation of Vietnam’s equities being upgraded in the future and included in the MSCI Emerging Market Index (as
opposed to the current Frontier Market Index), many companies have applied international guidelines, including those of
the IFC, to improve their corporate governance framework. Many companies in our portfolio have set up audit committees
under the board of directors. This board structure, with the support of the audit committee, helps set a strong ‘tone-at-
the-top’, overseeing the eectiveness and integrity of internal controls. In addition, many companies have made eorts in
improving the independence of their board by appointing more independent directors with work experiences from dierent
sectors. We have also observed a signicant improvement in investor relations activities and information disclosure of our
portfolio companies, with monthly performance updates and quarterly reports sent to investors, more content available in
English, and better dedicated investor relations support to address questions from investors.
26
Strategic ReportAnnual Report 2022
Sustainability Report (continued)
Dedicated Company Engagement Program
The Investment Manager assigns a high priority to the
engagement mandate entrusted by shareholders and
has established a Company Engagement Program,
emphasising the necessity to systematically implement
ESG factors for investee companies. By providing
knowledge on specic issues, the Investment Manager
supports companies in their own relevant nancial and ESG
matters and encourages positive changes by helping to
inuence improvements in sustainability policies, practices
and performance, and making recommendations where
appropriate. Furthermore, the engagement program helps
the Investment Manager in its portfolio decision-making
and risk management strategy.
As we have been evolving into a post-pandemic period,
the Investment Manager has been able to set up face-
to-face meetings with several portfolio companies under
the Company Engagement Program to discuss both the
company’s business strategy and ESG issues. During the
nancial year, the team had in-depth meetings with
FPT, GMD, and PNJ to help improve their ESG practices
with practical solutions in the short and medium-term.
Over several meetings, we have seen the eagerness,
willingness and strong commitment from the Board and
management of these companies in driving forward
ESG and sustainability actions for their businesses. For
example, FPT published its very rst ESG report in early
2022. PNJ established an ESG committee within its Board
of Directors and recruited a Senior ESG Manager to support
the company in developing its ESG strategy in the medium,
short, and long-term. GMD, with the strong determination
of its CEO, put a clear focus on improving the company’s
work culture and developing a decarbonisation roadmap.
Shareholder Voting
This year the Annual General Meetings of portfolio
companies (“AGM”s) were held in both online and oine
formats.
The Investment Manager considers each agenda issue
proposed by a company based on its merits related to
the strategic objectives of the investee company and
its potential impact on long-term performance. As part
of its usual ongoing practice, the Investment Manager
discusses the proposed agenda items with each of the
investee companies’ board of directors ahead of the actual
meetings.
During the nancial year, the Company, through the
Investment Manager, attended and voted at the Annual
General Meetings (“AGM”) of every portfolio company in
which it held an equity position, 27 in total. In all cases
during the past year, the Company voted in favour for
every agenda item proposed by each company’s boards
of directors.
Membership and Partnership to Promote ESG Practices
UNPRI
As noted above, the Company’s investment policy is aligned
with the UNPRI and the Company has been a UNPRI signatory
since 2009. Each year, the Company reports on its responsible
investment activities through the UNPRI Transparency
Report. In its most recent report, the Company received two
‘A’ scores and one ‘A+’ score, all higher than the median and
higher than its last year’s score. The improvement in active
ownership activities was noted, particularly in some of the
criteria, such as the engagement approach, escalation
strategy, number of companies engaged with, the topics
covered, and the way we share insights from engagements
with our stakeholders.
VIOD
Mr. Vu Quang Thinh – the CEO of Dynam Capital – is
a founding member of VIOD, the Vietnam Institute of
Directors, which is a professional organisation that promotes
corporate governance standards and best practices in the
Vietnamese corporate sector. VIOD was legally formed in
2018 with technical support from the International Finance
Corporation (“IFC”), a member of the World Bank Group
and Switzerland’s State Secretariat for Economic Aairs
(“SECO”). Governed by a Board of Directors comprised
of various private sector representatives, VIOD has close
collaboration with the State Securities Commission of
Vietnam (“SSC”), HOSE and HNX under the Vietnam
Corporate Governance Initiative (“VCGI”). With the
support of SSC, VIOD will continue to represent Vietnam
to participate in the 2021 ASEAN Corporate Governance
Scorecard. Our close collaboration with VIOD will continue
to play a key role in fostering good corporate governance
not only in our investee companies but across Vietnam’s
business community over the coming years.
AIGCC
As mentioned above, Dynam Capital, our Investment
Manager, is a member of the Asia Investor Group on Climate
Change (“AIGCC”). At the end of this nancial year, Dynam
Capital signed on the 2021 Global Investor Statement to
Governments on the Climate Crisis with more than 450
investors to call for governments to raise their climate
ambition and implement more eective policies to address
the climate crisis.
Others
In the nancial year, the Investment Manager also contributed
to the newly-established Vietnam Business Integrity Network,
VBIN, an initiative initiated by the Vietnam Chamber of
Commerce and Industry with the generous support from the
UK Prosperity Fund through the Regional Project “Promoting
Fair Business Environment in ASEAN – FairBiz” of the United
Nations Development Program – UNDP. VBIN is a new
initiative, a business-led and business-oriented network with
a focus on promoting business integrity, purpose and vision
for companies in Vietnam.
27
Strategic ReportAnnual Report 2022
Vietnam is an increasingly open trading nation, and the
changes in terms of international trade, disruption to
supply chains and impositions of taris could impact
directly and indirectly the Vietnamese economy and
the companies in which the Company is invested.
The Vietnamese economy can also be impacted by
the global-macro economic conditions, and also
geopolitical tensions. The Vietnamese capital markets
are relatively young, and liquidity levels can change
abruptly responding to changes in the behaviour of
domestic and international investors.
Parts of the portfolio may be prone to enhanced
liquidity and price risk.
Vietnam is currently classied as a Frontier Market
by MSCI, and the timetable for any inclusion as an
Emerging Market is unsure. Investor attitudes to Frontier
and Emerging Markets can change, leading to reduced
demand for the Company’s shares, and an increase in
the discount to NAV per share.
The Board is regularly briefed on political and economic
developments by the Investment Manager. The
Investment Manager publishes a monthly report on the
Company which includes information and commentary
on the macroeconomic developments in Vietnam.
The inherent liquidity levels in the portfolio have been
considered explicitly in the viability of the Company and
the Board is reasonably satised that even in periods of
distress and low liquidity there would be an adequate
level of assets that could be realised to meet the
liabilities of the Company as they fall due.
The Board has noted that the underlying market
liquidity in Vietnam has increased dramatically during
the last year, and the portfolio composition has also
included a higher percentage of larger and more liquid
companies.
The Investment Manager keeps shareholders and other
potential investors regularly informed on Vietnam in
general and the Company’s portfolio in particular. At
each Board meeting the Board receives reports from
the Investment Manager, from nnCap Ltd, its broker,
and is updated on the composition of the shareholder
register. In 2019 the Company migrated its domicile
from Cayman Islands to Guernsey and moved its
trading from AIM to a premium listing on the Main
Market of the LSE in order to make the shares attractive
to a wider audience of potential investors. In seeking to
narrow the discount, the Board has also implemented
an on-going share buy-back programme.
Market Risk
Investor
Sentiment
Key risk Description Mitigating action
The Board has carried out a robust assessment of the Company’s emerging and principal risks and considers with the
assistance of the Investment Manager the risks and uncertainties faced by the Company in the form of a risk matrix and
heat map. The investment management of the Company has been delegated to the Company’s Investment Manager. The
Investment Manager’s investment process takes into account the material risks associated with the Company’s portfolio
and the holdings in which the Company is invested. The Board monitors the portfolio and the performance of the Investment
Manager at regular Board meetings. The principal risks and the descriptions of the mitigating actions taken by the Board
are summarised in the table below.
Principal Risks and Risk Management
28
Strategic ReportAnnual Report 2022
The performance of the Company’s investment
portfolio could be poor, either absolutely or in relation
to the Company’s peers, or to the market as a whole.
The fund management activities are outsourced to
the Investment Manager. If the Investment Manager
became unable to carry out these activities or if the
Investment Management Agreement was terminated,
there could be disruptions to the management of the
portfolio until a suitable replacement is found.
The Company has no employees and is dependent
on a number of third parties for the provision of
services (including Investment Management, Fund
Administration and Custody). Any control failures or
gaps in the services provided could result in damage or
loss to the Company.
Failure to comply with relevant regulation and
legislation in relevant jurisdictions may have an impact
on the Company. Although there are compliance
policies (including anti-bribery policies) in place at
the Company, the Investment Manager and all service
providers, the Company could be damaged or suer
losses if any of these polices were breached.
The risks associated with the fair valuation of the
portfolio could result in the NAV of the Company being
misstated. The quoted companies in the portfolio
are valued at market price, but it may be dicult to
liquidate, where large positions are held, at these prices
in an orderly fashion in the ordinary course of market
activity. The values of the Company’s underlying
investments are denominated in Vietnamese Dong,
whereas the Company’s accounts are prepared in US
Dollars. The Company does not hedge its Vietnamese
Dong exposures so exchange rate uctuations could
have a material eect on the NAV.
The Board receives regular reports on the performance
of the portfolio and its underlying assets. The
Investment Manager reports to the Board at each Board
meeting, and the Board monitors the performance of
the Investment Manager.
The Board maintains a close contact with the
Investment Manager and reviews the performance of
the Investment Manager on a regular basis.
The Board receives regular reports from the Investment
Manager and Fund Administrator on their policies,
controls and risk management.
The Company is administered in Guernsey by a Fund
Administrator which reports to the Board at each Board
meeting on compliance matters. The Board receives
training and updates on compliance matters. The
Investment Manager is regulated in Guernsey and has
extensive compliance and risk management policies in
place.
The Board reviews the valuation of the portfolio with
the Investment Manager regularly.
The daily estimated NAV is calculated by the Investment
Manager.
The monthly NAV is calculated by the Fund
Administrator.
Investment
Performance
Investment
Management
Agreement
Operational
Legal and
Regulatory
Fair Valuation
Key risk Description Mitigating action
Principal Risks and Risk Management (continued)
29
Strategic ReportAnnual Report 2022
Climate change is happening faster than models earlier
predicted, threatening the safety of billions of people
on the planet. Vietnam is one of the ve countries most
vulnerable to climate change. The country’s diverse
geography means it is hit by sea level rise, typhoons,
landslides, ooding and droughts, and weather events
are expected to worsen in coming years. Two types of
climate-related risks have been identied. (1) Physical
risks: sea level rise, oods and typhoons that put
infrastructure or real estate companies with projects
in coastal areas or low-lying levels at higher risk from
physical impacts of climate change.
(2) Transition risks: climate policy and rising carbon
prices may cause higher prices and impact the viability
of companies that rely on fossil fuels or those in carbon
intensive activities and may necessitate a signicant,
and costly, technology shift.
Outbreaks of variants of coronavirus (“COVID-19”)
as part of a global pandemic pose a health concern
through fast person-to-person spread, resulting in an
illness that can lead to death. Lockdowns, quarantine
measures and restrictions on travel can cause sustained
global economic disruption and slowdown in growth,
and can cause some industries and companies to face
severe nancial pressures that can lead to job losses
and in extreme cases bankruptcies, impacting the
value of the investments held by the Company, and
weakening investor condence. Key service providers to
the Company could face loss of personnel, diminution
in service capability and could impact the ongoing
operations of the Company. Travel restrictions can
prevent the Directors of the Company from meeting in
person. Delays in rolling out vaccinations may prolong
the economic impact on Vietnam and its population as
other countries begin to re-open their borders to travel.
The Board, through the Investment Manager, has
engaged a specialist consulting rm in Vietnam to help
estimate the portfolio’s carbon footprint and identify the
carbon-intensive sectors. The Investment Manager has
undertaken to analyse the physical and transition risks
of climate-sensitive industries to develop an appropriate
investment and engagement strategy and to encourage
investee companies to do more on climate-related risk
assessment and disclosures. The Investment Manager
monitors investee companies that are identied to be at
high climate risks.
The Investment Manager is a member of the Asia
Investor Group on Climate Change and keeps abreast
of the changes in policies that may impact transition
and other climate-related risks. The Board is in regular
contact with the Investment Manager, and receives
reports through the ESG Committee and the Audit and
Risk Committee.
The Board is in regular contact with the Investment
Manager, receiving regular updates on the development
and the spread of COVID-19, mitigating actions in
Vietnam, including the roll-out of vaccinations, and the
impact on the performance of the investment portfolio.
The Board has veried that the key service providers all
have functional Business Continuity Plans.
The Investment Manager and its wholly owned subsidiary
in Vietnam has a BCP that includes dividing sta into two
separate teams and enabling all sta to work from home
as necessary. The BCP has been tested and implemented
several times without loss of service to the Company.
The key activities of the Company and its service
providers can be conducted virtually through online calls,
electronic mail and video-calls.
The Investment Manager, on behalf of the Company
uses Regulatory News Services, monthly newsletters,
webinars and ad-hoc updates through social media to
keep the investors updated on the impact of COVID-19
on the portfolio.
Climate Risk
COVID-19
Key risk Description Mitigating action
New risks beyond those identied as Principal Risks can
develop. These Emerging Risks may have a detrimental
or existential impact on the Company.
The Board reviews the risk matrix and risk register that
captures and tracks emerging risks as part of its overall
risk management practices. Emerging Risks are identied
and recorded with a description of their root cause, a
risk assessment, a description of mitigating actions, a
monitoring plan, and a net risk rating. Changes in risk
ratings are presented to the Board on a quarterly basis.
There are no emerging risks to bring to the attention of
the shareholders at the date of the Annual Report.
Emerging Risks
30
Name Stock Exchange
Disclosure of Directorships in Public Companies Listed on Recognised Stock Exchanges
All of the Directors are Non-executive Directors and are independent of the Investment Manager.
Hiroshi Funaki (Chairman)
Mr Funaki has been actively involved in raising, researching and trading Vietnam funds since 1995. He worked at Edmond de
Rothschild Securities from 2000 to 2015 where he led the Investment Companies team, focusing on Emerging Markets and
Alternative Assets. Prior to that he was Head of Research at Robert Fleming Securities, also specialising in closed-end funds.
He currently acts as an investment adviser to a Family Oce. He has a MA in Mathematics and Philosophy from Oxford
University and is a UK resident.
Philip Scales (Audit and Risk Committee Chairman)
Mr Scales has over 40 years’ experience working in oshore corporate, trust, and third-party fund administration. For 18
years, he was managing director of Barings Isle of Man (subsequently to become Northern Trust) where he specialised
in establishing oshore fund structures, mainly in the closed-ended arena (both listed and unlisted entities). Mr Scales
subsequently co-founded FIM Capital Limited where he is Deputy Chairman. He is a Fellow of the Institute of Chartered
Secretaries and Administrators and holds a number of directorships of listed companies and collective investment schemes.
He is an Isle of Man resident.
Sean Hurst (Senior Independent Director and Environmental, Social and Governance Committee Chairman)
Mr Hurst was co-founder, director and chief investment ocer of Albion Asset Management, a French regulated asset
management company, from 2005 to 2009. He is an experienced multi-jurisdictional director including roles at Main Market
and AIM traded funds and numerous oshore and UCITS funds. In addition to advising companies on launching both
oshore and onshore investment funds, he is currently non-executive chairman of JPEL Private Equity Ltd and non-executive
director at CIAM Opportunities Fund. Mr Hurst was formerly a non-executive director of AIM listed ARC Capital Holdings Ltd.
He holds an MBA in Finance from CASS Business School in London and is a resident of France.
Damien Pierron (Management Engagement Committee Chairman)
Mr Pierron is currently Managing Partner at Ankaa Ventures, a Venture Capital rm active in Seed stage in Europe. In his
last position, he was a managing director in Societe Generale. Mr Pierron has 20 years’ experience in M&A and Private
equity gained at, among others, Lafarge Holcim, OC&C Strategy Consultants, Natixis and Societe Generale. He is a CFA
charterholder and holds an Engineering Degree in Mathematics, Physics and Economy from Ecole Polytechnique in Paris and
a Master’s Degree in Quantitative Innovation from Ecole Nationale Superieure des Mines de Paris. He is a Dubai resident.
Saiko Tajima (Remuneration and Nomination Committee Chairman)
Ms Tajima has over 20 years’ experience in nance, of which 8 years have been spent in Asian real estate asset management
and structured nance. Working for Aozora Bank and group companies of Lehman Brothers and Capmark, she focused on
nancial analysis, monitoring and reporting to lenders, borrowers, auditors, regulators and rating agencies. Over the last 8
years, she has invested in and helped develop tech start-ups in Tokyo, Seoul and Sydney. She is a Certied Public Accountant
in the US and is a UK resident.
Sean Hurst London
Philip Scales Channel Islands
Company Name
JPEL Private Equity Ltd
First World Hybrid Real Estate plc
GovernanceAnnual Report 2022
31
GovernanceAnnual Report 2022
The Directors are responsible for the determination of
the overall management of the Company including its
investment policy and strategy. This includes the review
of investment activity, performance and control and
supervision of the Investment Manager and other advisers.
All of the Directors are non-executive and are independent
of the Investment Manager.
The Board is also responsible for its own composition,
capital raising, meeting statutory obligations and public
disclosure, nancial reporting and entering into any
material contracts by the Company.
The Directors have access to the advice and services of the
Administrator and Secretary, who are responsible to the
Board for ensuring that Board procedures are followed and
that it complies with Company Law, applicable rules and
regulations of the Guernsey Financial Services Commission,
the London Stock Exchange and The International Stock
Exchange.
Where necessary, in carrying out their duties, the Directors
may seek independent professional advice at the expense
of the Company.
The Board of the Company has considered the Principles
and Provisions of the Association of Investment Companies
Code of Corporate Governance issued in February 2019
(“AIC Code”). The AIC Code addresses the Principles and
Provisions set out in the UK Corporate Governance Code
(the “UK Code”), as well as setting out additional Provisions
on issues that are of specic relevance to the Company.
The Board considers that reporting against the Principles
and Provisions of the AIC Code, which has been endorsed by
the Financial Reporting Council and the Guernsey Financial
Services Commission provides more relevant information
to Shareholders. The Board considers by reporting against
the AIC Code, they are meeting their obligations under the
UK Code, the 2011 GFSC Finance Sector Code of Corporate
Governance and associated disclosure requirements under
paragraph 9.8.6 of the Listing Rules.
The AIC Code is available on the AIC website (www.theaic.
co.uk). It includes an explanation of how the AIC Code
adapts the Principles and Provisions set out in the UK Code
to make them relevant for investment companies.
Except as disclosed within this report, the Board is of the view
that the Company complied with the recommendations of
32
Corporate Governance Report
the AIC Code and the relevant provisions of the AIC Code
during the year ended 30 June 2022. Key issues aecting
the Company’s corporate governance responsibilities, how
they are addressed by the Board and application of the AIC
Code are presented below.
The AIC Code includes a provision relating to the
appointment of a Senior Independent Director and the
Board conrms that Sean Hurst is the appointed Senior
Independent Director of the Company. Liaison with
Shareholders is dealt with mainly by the Chairman of the
Company and the Senior Independent Director working
closely with the Company’s Advisors.
Directors’ Responsibilities to Stakeholders
Section 172 of the UK Companies Act 2006 applies directly
to UK domiciled companies, however the AIC Code requires
that the matters set out in Section 172 are reported by all
companies, irrespective of domicile. This requirement does
not conict with the Companies Law in Guernsey.
Section 172 recognises that Directors are responsible for
acting in a way that they consider, in good faith, is most
likely to promote the success of the Company for the
benet of its shareholders as a whole. In doing so, they are
also required to consider the broader implications of their
decisions and operations on other key stakeholders and
their impact on the wider community and the environment.
Key decisions are dened as those that are material to
the Company, but also those that are signicant to any
of the Company’s key stakeholder groups. The Company’s
engagement with its key stakeholders is outlined on page
35 of the corporate governance section of this report.
Board Independence and Composition
The Board consists of ve Non-executive Directors, each
of whom is independent. No member of the Board is
connected to the Investment Manager or any of the
service providers appointed. Four of the Board members
were appointed in September/October 2017 following the
retirement of the previous Board and the fth member was
appointed in May 2019 following the retirement of a Board
member at the 2018 AGM.
Mr Funaki is a Director of Discover Investment Company
which holds 1,405,776 ordinary shares in the Company
representing 4.81% of the issued share capital. The Board
are satised that this does not have any impact on Mr
Funaki’s independence as a Director of the Company.
GovernanceAnnual Report 2022
Hiroshi Funaki
Sean Hurst
Philip Scales
Damien Pierron
Saiko Tajima
Hiroshi Funaki
Sean Hurst
Philip Scales
Damien Pierron
Saiko Tajima
Audit and Risk
Board
Remuneration
and Nomination
Management
Engagement
6 (6)
6 (6)
6 (6)
6 (6)
6 (6)
6 (6)
6 (6)
6 (6)
6 (6)
6 (6)
1 (1)
1 (1)
1 (1)
1 (1)
1 (1)
1 (1)
1 (1)
1 (1)
1 (1)
1 (1)
19,887
5,312
10,077
4,644
5,000
In addition there were 2 meetings of the Buy-Back Sub-Committee held during the year.
Board Independence and Composition (continued)
As detailed in note 8 of the nancial statements, Directors own shares in the Company as follows:
The Board reviews the independence of the Directors regularly and at least annually.
The Company is committed to ensuring that any board appointments are lled by the most suitably qualied candidates.
The Board acknowledges the benets of greater diversity and is committed to ensuring that the Board brings a wide
range of skills, knowledge and experience. No specic diversity parameters have been set as the Board believes that all
appointments should be made on merit and taken in the context of the skills, knowledge and experience required for
an eective Board. The Nomination Committee is responsible for evaluating any new Board appointment and making
appropriate recommendations to the Board.
The Board believes the current board members have the appropriate qualications, experience and expertise to manage the
Company. The Directors’ biographies can be found on page 31.
Board Meetings and Attendance
The Board meets regularly during the year with representatives from the Investment Manager present. In addition,
representatives from the Company’s Broker and Administrator attend Board and committee meetings by invitation. At
each quarterly Board meeting the performance of the portfolio is formally reviewed and during the year, Board members
also attend investment meetings with members of the Manager’s senior team. The Board members have a range of skills
covering investment management, banking, compliance and corporate governance as well as prior experience of acting as
directors of companies listed on the London Stock Exchange.
The Company’s brokers and lawyers are consulted on any matters where external expertise is required, and external advisers
attend board meetings as invited by the Chairman to report on and/or discuss specic matters relevant to the Company.
During the year 6 Board meetings were held and the record of attendance at each Board and committee meeting was as
follows:
Corporate Governance Report (continued)
33
GovernanceAnnual Report 2022
Tenure of Board Members and Succession Planning
The Company has adopted a formal policy that neither the
Chairman nor any other Director shall serve for more than
9 years.
Re-election of Directors
The Board has agreed that all Directors should submit
themselves for annual re-election.
Mr. Hurst, Mr Funaki, Mr Pierron, Mr Scales and Ms Tajima
will all stand for re-election at the 2022 AGM.
The individual performance of each Director standing for
re-election or election has been evaluated by the other
members of the Board and a recommendation will be
made that Shareholders vote in favour of their re-election
at the AGM in November 2022.
Administration
On 7 October 2019 the Board appointed Sanne Group
(Guernsey) Limited to provide corporate governance,
secretarial, compliance and accounting services to the
Company.
Conflicts of Interest
The Directors are reminded at each Board meeting of their
obligations to notify any changes in their statement of
conicts and also to declare any benets received from
third parties in their capacity as a Director.
A register of conicts is maintained by the Administrator
and formally reviewed on a quarterly basis. Each Director
is required to declare any potential conicts of interest on
an ongoing basis.
Performance Evaluation
During the year the Board undertook an evaluation
exercise into the eectiveness of both the Board and the
Committees. The programme was undertaken by the
Administrator and no signicant issues were identied.
The Remuneration and Nomination Committee will again
consider whether for the next evaluation due in 2022, an
external facilitator should be appointed to undertake the
evaluations.
Professional Development and Training
New Directors are provided with all relevant information
regarding the Company’s business and given the
opportunity to meet with key functionaries prior to
appointment. They are also provided with induction
training.
34
It is the responsibility of each Director to ensure that they
maintain sucient knowledge to full their role and so are
encouraged to participate in seminars and training courses
where appropriate.
Committees of the Board
Four Committees have been formed, an Audit and Risk
Committee, a Remuneration and Nomination Committee,
a Management Engagement Committee and an ESG
Committee. Since September/October 2017 the Company
has been through a period of considerable change and
all Board members are members of each committee.
The Chairman of the Company does not Chair any of the
Committees. Details of the Chairman of each committee,
together with the number of meetings held during the year
are shown on pages 33 to 35. A summary of the Terms of
Reference of each committee is detailed below and a copy
of the Terms of Reference are available on the Company’s
website www.vietnamholding.com.
Audit and Risk Committee
The Chairman of the Audit and Risk Committee is Philip
Scales and the Committee meets at least twice per annum.
All members of the Board are members of the Committee.
This includes the Chairman of the Company where, given
the size of the Board, the experience of all members and
the independence of the Company Chairman, it is felt
appropriate that all Board members play a role in the
Audit and Risk Committee. The principal responsibility of
the Committee is to monitor the production of the Interim
and Annual Financial Statements and to present these to
the Board for approval.
Other duties include reviewing the internal nancial
controls and monitoring third party service providers,
review and monitor the external auditor’s independence
and objectivity along with the eectiveness of the audit
process and to make recommendations to the Board
in relation to the appointment of the External Auditor
together with their remuneration.
A report of the Audit and Risk Committee is detailed on
pages 37 to 38.
Remuneration and Nomination Committee
The Remuneration and Nomination Committee is chaired
by Saiko Tajima and all members of the Board are
members of the Committee. The Board considers that all
the Directors are independent and therefore eligible to be
members of the Committee. The Committee meets at
least once in each year and at such other times as may be
considered necessary.
GovernanceAnnual Report 2022
Remuneration and Nomination Committee
(continued)
The principal duties of the Remuneration and Nomination
Committee are to review the fees paid to the Non-executive
Directors, to consider the appointment of external
remuneration consultants, to review the structure, size
and composition of the Board, make recommendations
to the Board for any changes and to consider succession
planning. The Committee also undertakes the evaluation
of the appointment of any additional or replacement
Directors and ensures they are provided with training
and induction. The Committee arranges for an annual
evaluation of all Board and Committee members.
During the year the Committee reviewed the fees paid to
Directors and resolved that no changes be recommended.
The AIC Code includes a provision relating to the
appointment of a Senior Independent Director of which
Sean Hurst occupies this role.
No new Board appointments were considered during the
year but the Committee rearmed the policy that no
Director should serve for more than 9 years.
Management Engagement Committee
The Chairman of the Management Engagement Committee
is Damien Pierron and the Committee shall meet at least
once a year. All members of the Board are members of
the Committee. The principal duties of the Committee
are to review the performance and appointment of the
Investment Manager together with their remuneration
and to review the eectiveness and competitiveness of the
other main service providers and functionaries together
with reviewing their performance.
A share buy-back sub-committee consisting of Hiroshi
Funaki and Sean Hurst has been formed under the
Management Engagement Committee and meets
regularly to review and monitor the share buy-back
programme. Damien Pierron also joins the share buy-back
sub-committee on an ad-hoc basis.
During the year the Committee reviewed the performance
of the Investment Manager, Administrator and Sub-
Administrator, Corporate Broker and Registrar. No changes
were recommended as a result of these reviews.
Environmental, Social and Governance Committee
The ESG Committee was established in the prior year and
is chaired by Sean Hurst with all members of the Board
forming the Committee. The aim of the Committee is to
Corporate Governance Report (continued)
establish a unied view of ESG, increasing understanding
of all three aspects: environmental, social and governance,
and to promote the robust standards of corporate
governance that the Company adopts.
The purpose of the ESG Committee, which shall meet
at least once a year, is to support the Company’s on-
going commitment to environmental, health and safety,
corporate social responsibility, corporate governance,
sustainability, and other public policy matters relevant to
the Company (collectively, “ESG Matters”).
Shareholder Engagement
The Company is committed to listening and communicating
openly with its Shareholders to ensure that its strategy,
business model and performance are clearly understood.
All Board members have responsibility for Shareholder
liaison but Shareholder contact is mainly dealt with by the
Chairman of the Company and the Senior Independent
Director in close liaison with the Company Advisors.
Copies of the Annual Report are sent to all Shareholders
and can be downloaded from the website. Other Company
information including the Interim Report is also available
on the website.
The Company holds an AGM in each year, which gives
investors the opportunity to enter into dialogue with the
Board and for the Board to receive feedback and take action
as necessary. The Investment Manager also participates
in meetings with investors arranged by the Company’s
Broker and has arranged seminars and webinars to update
current and prospective investors on the developments
in the Vietnamese market and the performance of the
Company. The Investment Manager also updates the
Company’s website and sends out monthly factsheets on
the Company to investors who have registered to receive
such updates. The Company has a LinkedIn page which is
administered by the Investment Manager.
The Board reviews proxy voting reports and any signicant
negative response is discussed with relevant Shareholders
and, if necessary, where appropriate or possible, action is
taken to resolve any issues. In the interest of transparency
and best practice, the level of proxy votes (for, against and
vote withheld) lodged on each resolution is declared at all
general meetings and announced.
Corporate Policies
Anti-Bribery and Corruption Policy
The Board is committed to the prevention of bribery
throughout the organisation and will take every step
35
GovernanceAnnual Report 2022
36
necessary to ensure to the best of its ability, that business
is conducted fairly, honestly and openly. It has adopted
a formal policy to combat fraud, bribery and corruption
and will seek annual conrmation from the Investment
Manager and other service providers it engages that they
have similar policies in place. Furthermore, the Board has
zero tolerance to the criminal facilitation of tax evasion.
These policies apply to the Company and to each of its
Directors. Further, the policies are shared with each of the
Company’s service providers, each of which conrms its
compliance annually to the Board.
Criminal Facilitation of Tax Evasion Policy
The Board has taken steps to ensure there is no criminal
facilitation of tax evasion. This applies to the Company
and to each of its Directors, as well as service providers. A
policy has been adopted by the Board.
General Data Protection Regulation
The Company abides by general data protection
regulation. As it is established in the Bailiwick of Guernsey,
under The Data Protection (Bailiwick of Guernsey) Law,
2017, the Company has registered with the Oce of the
Data Protection Authority.
The Company
Global Greenhouse Gas Emissions
The Company has no signicant greenhouse gas emissions
to report from its operations for the year to 30 June 2022,
nor does it have responsibility for any other emission
producing sources. The Company is very conscious of
its own carbon footprint in carrying out its business
activities. The main source of this for the Company is in
the international and domestic air travel of the Board of
Directors and members of the Investment Manager in
conducting the business of the Company and meeting
with Shareholders. For the year to 30 June 2022, many
of the board meetings were conducted through video-
conference as a result of restrictions related to COVID-19.
During the year members of the Board travelled to London,
Zurich and Ho Chi Minh City in conducting the business
of the Company. The estimated carbon footprint of travel
activities (that have not already been oset at source)
amounts to approximately 46.61 tonnes of CO
2
e.
The Company engaged a specialist consulting rm to
estimate the carbon footprint of the portfolio, and this is
detailed in the
Sustainability Report
.
Gender Metrics
The Board of the Company recognises the governance
mechanism to ensure there is diversity amongst the
Directors and as such a female was appointed to the
Board in May 2019. In addition, the Board is reviewing
the Policy Statement issued by the FCA in April 2022 on
Diversity and inclusion on company boards and executive
management and consequential changes to the Listing
Rules. These changes apply to accounting periods starting
on or after 1 April 2022 and will be reported on more fully in
the 2023 nancial statements of the Company. The Board
notes also that 40% of the team members employed by
the Investment Manager and its subsidiary in Vietnam are
female.
GovernanceAnnual Report 2022
The main items that the Audit and Risk Committee (the
“Committee”) has reviewed during the year ended 30 June
2022 were:
Internal Control
As a company with a Board consisting entirely of Non-
executive Directors and which outsources the day-to-
day activities of portfolio management, administration,
accounting and company secretarial to external service
providers, the Board considers the provision of an internal
audit function is not relevant to the position of the
Company.
The Committee reviews the internal nancial control
systems for their eectiveness and through the
Management Engagement Committee, monitors the
performance of the external service providers. The Board
recognises its ultimate responsibility for the Company’s
system of internal controls to ensure the maintenance of
proper accounting records, the reliability of the nancial
information upon which business decisions are made and
that the assets of the Company are safeguarded. Through
these procedures, the Directors have kept under review the
eectiveness of the internal control system throughout the
year and up to the date of this report. There were no issues
arising from this review.
Membership and Attendance
The Committee membership currently consists of all
Board members under the Chairmanship of Philip Scales.
This includes the Chairman of the Company where, given
the size of the Board, the experience of all members and
the independence of the Company Chairman, it is felt
appropriate that all Board members play a role in the
Audit and Risk Committee. The Terms of Reference allow
appointments to the Committee for a period of up to 3
years and this may be extended for two further 3-year
periods provided that the Director remains independent.
The Committee holds at least three meetings a year
which are to review the Annual and Half-Year Reports of
the Company and also for audit planning purposes and
a review of risks relevant to the Company. Details of the
Audit and Risk Committee Report
reviewing the content of the Interim Report and the
Annual Report;
reviewing the independence and eectiveness of the
External Auditor;
considering and reviewing the internal control and
risk management systems and the work of the service
providers; and
reviewing the control framework with the assistance of
the Investment Manager and Administrator. to monitor the integrity of the nancial statements of
the Company and any formal announcements relating
to the Company’s nancial performance;
to review the Company’s internal nancial controls
and the internal control and risk management systems
of the Company and its third party service providers;
to make recommendations to the Board in relation
to the appointment of the External Auditor and their
remuneration; and
to review and monitor the External Auditor’s
independence and objectivity and the eectiveness of
the audit process.
A copy of the Terms of Reference of the Committee are
available either from the Company’s website or from the
Company’s Administrator.
Valuation of Investments
The fair value of the Company’s investments at 30 June
2022 was USD 120.9 million which represented 93.9% of the
Company’s NAV (30 June 2021: USD 193.1 million and 98.5%
respectively). The valuation of investments is the most
signicant factor in relation to the accuracy of the nancial
statements.
The Committee reviewed the portfolio valuation as at 30
June 2022 and obtained conrmation from the Investment
Manager that the Company’s policies on the valuation
of investments had been followed. The Committee also
made enquiries of the Sub-Administrator and Custodian,
both of whom are independent of the Company, to check
procedures are in place to ensure the portfolio is valued
correctly.
The Committee agreed the approach to the audit of the
valuation of investments with the External Auditor prior to
the commencement of the audit. The results of the audit in
this area were reported by the External Auditor and there
were no signicant disagreements between the Investment
Manager, the Sub-Administrator and the External Auditor’s
conclusions.
number of committee meetings held during the year
ended 30 June 2022 and the number of those attended by
each committee member are shown on page 33.
The External Auditor is invited to attend committee meetings
where the Annual and Half-Year Reports are considered and
separate meetings are held with the External Auditor where
the Investment Manager is not present.
Principal Duties
The main responsibilities of the Committee include:
37
GovernanceAnnual Report 2022
38
The Board reviews the changes in valuations at each
quarterly Board meeting.
External Audit
KPMG Channel Islands Limited (“KPMG”) has been
the External Auditor since the Company re-domiciled
in Guernsey on 25 February 2019. The Committee held
meetings with KPMG before the start of the audit to discuss
formal planning and to discuss any possible issues along
with the scope of the audit and appropriate timetable.
Informal meetings have also been held with the Chairman
of the Committee in order that the Chairman is kept up to
date with the progress of the audit and formal reporting
required by the Committee.
Annually, the Committee reviews the performance of KPMG
in order to recommend to the Board whether or not the
Auditors should be reappointed for the next year.
Audit fees payable to KPMG for 2022 are GBP 56,000 (2021:
GBP 52,000). Non audit fees payable to KPMG for 2022 were
GBP nil (2021: GBP nil).
The Committee has reviewed KPMG’s report on their
independence and objectivity including their structure for
the audit of the Company and is satised that the services
provided by KPMG do not prejudice its independence. The
Committee will continue to review any non-audit services
that may be provided by KPMG in order to ensure their
continuing independence and integrity.
Risk Management
An outline of the risk management framework and
principal risks is detailed on pages 28 to 30. The Committee
will keep under review nancial and operational risk
including reviewing and obtaining assurances from key
service providers for the controls for which they are
responsible.
Anti-Bribery and Corruption
The Company has a zero-tolerance approach to bribery and
corruption, in line with the UK Bribery Act 2010. An Anti-
Bribery and Corruption Policy has been adopted and is kept
under review.
Audit Quality Review (AQR) Inspection Report
On 26 August 2022, the Company received a copy of an AQR
Inspection Report issued by the Financial Reporting Council
following their completion of a review into the Company’s
30 June 2021 annual audit. The AQR described some other
ndings that were required to be implemented by KPMG
Channel Islands Limited in the following year’s audit of the
Annual Report.
Annual Report
The Committee has reviewed the Annual Report along with
reports and explanations from the Company’s Investment
Manager, Administrator, and other service providers.
The Committee is satised that the Annual Report is fair,
balanced, and understandable and that it provides the
necessary information for Shareholders to assess the
Company’s performance, business model, and strategy.
The Committee is satised that KPMG has fullled its
responsibilities in respect of the annual audit and has
recommended that KPMG be re-appointed for the
forthcoming nancial year.
Philip Scales
Audit and Risk Committee Chairman
30 September 2022
GovernanceAnnual Report 2022
Remuneration Policy
The Directors are entitled to receive fees for their services which reect their experience and the time commitment required.
At the Annual General Meeting to be held in November 2022 an ordinary resolution seeking approval for the Directors’
remuneration report will be put to Shareholders.
Directors’ Remuneration
Directors’ fees are paid within limits established in the Articles of Incorporation which shall not exceed an aggregate of
USD 350,000 in any nancial year (or such sum as the Company shall from time to time determine). The Directors may also
be paid reasonable travelling, hotel and other out-of-pocket expenses properly incurred in attending Board, committee
meetings or general meetings. The Remuneration Committee reviews the Directors’ fees periodically although the review
will not necessarily result in any increase. For the year ended 30 June 2022 annual Directors’ fees remained at USD 50,000
with the Chairman of the Company receiving an additional USD 10,000 per annum or prorated as applicable and, the Senior
Independent Director and the Chairman of the Audit and Risk Committee receiving an additional USD 5,000 per annum or
prorated as applicable.
The Directors are also paid a per diem fee of USD 1,500 for each Board meeting attended and USD 750 for a committee
meeting attended, either in person or by telephone.
The Company has no bonus schemes, pension schemes, share option or other long-term incentive schemes in place for the
Directors.
The single total gure of remuneration for each Director who served during the year ended 30 June 2022 and the previous
year is as follows:
Hiroshi Funaki
(Chairman)
Sean Hurst
(Senior Independent Director)
Philip Scales
(Audit and Risk Committee Chairman)
Damien Pierron
Saiko Tajima
Total
60,000
55,829
55,000
50,000
50,000
270,829
60,000
55,185
55,000
50,000
50,000
270,185
11,250
10,741
6,750
7,873
6,000
42,614
10,125
10,125
9,000
9,424
9,000
47,674
70,125
65,310
64,000
59,424
59,000
314,859
71,250
66,570
61,750
57,873
56,000
313,443
Director
Year ended 30 June 2021
Total
USD
Total
USD
Base Fees
USD
Base Fees
USD
Additional
Ad hoc fees
USD
Additional
Ad hoc fees
USD
Directors’ Remuneration Policy and Report
Year ended 30 June 2022
39
GovernanceAnnual Report 2022
40
GovernanceAnnual Report 2022
The Directors present the Annual Report and Financial
Statements of the Company for the year ended 30 June
2022.
The Company
VietNam Holding Limited (the “Company”) is a closed-
end investment company that was incorporated in the
Cayman Islands on 20 April 2006 as an exempted company
with limited liability under registration number 166182. On
25 February 2019, the Company, via a process of cross-
border continuance, transferred its legal domicile from
the Cayman Islands to Guernsey and was registered as a
closed-ended company limited by shares incorporated in
Guernsey with registered number 66090.
The investment objective of the Company is to achieve
long-term capital appreciation by investing in a diversied
portfolio of companies that have high growth potential at
an attractive valuation.
At the Extraordinary General Meeting held on 31 October
2018 the Shareholders voted in favour of the continuance
resolution, authorising the Company to operate in
its current form through to the 2023 Annual General
Meeting when a similar resolution will be put forward for
Shareholders’ approval.
Dynam Capital, Ltd has been appointed as the Company’s
Investment Manager and is responsible for the day-to-
day management of the Company’s investment portfolio
in accordance with the Company’s investment policies,
objectives and restrictions.
Results
The net loss for the year ended 30 June 2022 amounted
to USD 7,719,310 (2021: net income USD 100,153,888). There
were no dividends declared during the year ended 30 June
2022 (2021: USD nil).
Going Concern
The nancial position of the Company, its cash ows and
liquidity position are described in Financial Statements and
the Notes to Financial Statements. These also contain the
Company’s objectives, policies, processes for managing its
capital, its nancial risks management objectives, details
of its nancial instruments, and its exposures to credit risk
and liquidity risk.
The Company’s forecasts and projections have been stress
tested taking into account the potential for (i) asset value
declines, (ii) declines in cash dividends from equities
held in the portfolio and (iii) share buybacks and tender
oers. The Directors note that the underlying liquidity of
Vietnamese stocks has increased signicantly over the
last twelve months with average daily traded volumes
Directors’ Report
increasing by as much as 5x the level of the prior year. The
Director’s also note that the portfolio is composed of a
higher percentage of larger and more liquid stocks than
in the prior year. Lastly, the Directors note that at year-
end the portfolio is comprised of cash and quoted stocks
only. The Company’s liquidity position, taking into account
cash held and with the ability to sell underlying assets to
meet share buybacks, tenders and to meet the operating
costs of the Company, shows that the Company is able
to operate with appropriate liquidity and be able to meet
its liabilities as they fall due. The Directors therefore have
a reasonable expectation that the Company will have
adequate resources to continue its operations for the
foreseeable future. Thus, they continue to adopt the going
concern basis of accounting in preparing the nancial
statements.
Viability Statement
The Board has considered the viability period for the
Company, using the criteria set out in the UK Corporate
Governance Code. The Board considered the current
position of the Company, and its longer-term prospects,
strategies as well as its principal risks in the current,
medium and long-term, as detailed in the Principal
Risks and Risk Management on pages 28 to 30 and in
the Investment Manager’s Report on pages 7 to 15. The
strategy provides long term direction and is reviewed
annually and further tested in a series of robust downside
nancial scenarios as part of the annual review. These
scenarios included an assessment of those risks that
would threaten its strategic objectives, its business-as-
usual state, its business model and its future performance,
solvency or liquidity. The sensitivity analysis was applied to
the forecasted cash ows. Based on this assessment and
the Investment Objective of the Company, the Board has
determined that a three-year viability period to 30 June
2025 is an appropriate period that the Company will be
able to continue in operation and meet its liabilities as
they fall due over the period of three years. The Board
also travelled to Vietnam in June 2022, meeting with the
research team, of the Investment Manager, meeting with
portfolio companies and market commentators.
In arriving at this conclusion, the Board considered:
- The volatility of global economic conditions, lingering
impacts of COVID-19, the war in Ukraine and ination:
The Board considered the impact and eectiveness of
mitigation strategies being mandated by governments in
impacted countries; the adverse nancial impact already
being experienced by the Company: the disruption to
economic activity and nancial pressures and impact on
investments in the Company’s portfolio. The Board also
engaged with the Investment Manager on the longer-
term impact of climate change, and other societal change
41
GovernanceAnnual Report 2022
The liquidity of the Company’s underlying portfolio
is relatively high: average daily trading volumes on
Vietnam’s stock markets have reached three to four
times the levels of previous years. All new invested
stocks in this year are listed which have relatively
high liquidity. At year end there were no unquoted
investments and all securities are ‘Level 1’. Recent
stress testing has conrmed that the underlying
holdings can be easily liquidated, despite the more
uncertain and volatile economic environment. In
August and September 2021, 30% of the portfolio
was readily liquidated to provide funding for a Tender
Oer, without any issues. It is estimated that up to
93% of the portfolio can be readily liquidated in less
than ten trading days and 99% of the portfolio in
less than 30 days. The portfolio is un-geared and, as
it holds all listed securities, has sucient liquidity to
meet the Company’s liabilities.
The current portfolio is low to medium risk based on
assessments both individually and in combination of
liquidity risk, credit risk, interest rate risk and currency
risk. The Investment Manager and the Board review
and evaluate the portfolio on a monthly basis.
The Company has a portfolio that generates
investment income through dividends payments.
The cash dividends received can be used to partially
oset the Company’s on-going expenses. In the year
under review, total on-going expenses were covered
0.43 times by investment income. In the following
year, the current investment income is forecast to
cover 0.48 times the amount of on-going expenses. In
the stress-tested scenario with signicant declines in
cash dividends forecasted, the investment income is
forecast to cover 0.39 times on-going expenses.
The Company maintains a cash buer of approximately
3.4% of NAV to help meet on-going expenses.
- Principal risks:
The Board’s review considered the Company’s cash
ows and income ows, with reference to operational,
business, market, currency, liquidity, interest rate and
credit risk associated in nancial instruments set out in
note 3 (Financial Instruments and Associated Risks) and
note 4 (Operating Segments) of the nancial statements
on pages 60 to 64. The statistical modelling is used to
quantify these risks, which ensures that the Company
holds sucient nancial assets and capital to mitigate the
impact of these risks.
- Incomes and expenses:
42
factors, to the portfolio. Additionally, the Board took into
consideration the impact on the capital markets in Vietnam;
the existence and eectiveness of business continuity plans
of the Company and its service providers; and the impact on
our stakeholders caused by COVID-19. The Board reviewed
macro-reports and updates from the Investment Manager
detailing the impacts of rising ination in the US and Europe
on Vietnam, and also the direct impacts of the war in
Ukraine.
- Business environment:
Whilst the impact of COVID-19 on the global business
environment may linger, there are visible signs of post-
COVID-19 recovery which the Board were able to see rst-
hand on their visit to Vietnam in June 2022. There has
been an increase in consumer demand, return to greater
travel freedoms and signs of a return to stronger economic
growth. The Company’s strategy for investing in a portfolio
of equities in Vietnam and targeting growth in the value
of the portfolio over the medium term is unchanged. The
combination of potential structural opportunities that may
benet Vietnam as a destination for manufacturing, and the
opportunities within the growing domestic market provide
attractive investment opportunities. The direct impact of
the war in Ukraine on Vietnam appears to be manageable,
with less than 1% of trade to Russia and Ukraine. The levels
of ination in Vietnam are less pronounced than those in
Europe and the US, and the macro-economic position
appears to be stronger than in many other frontier and
emerging economies.
- Continuation vote in 2023:
The Fund has a formal continuation vote in 2023 and it is
the current intention of the Board to table a continuation
resolution at the 2023 Annual General meeting.
- Operations:
2021 was another year of signicant operational change
caused by the COVID-19 pandemic. During parts of 2021
there were strict lockdowns enforced in Vietnam, disruption
to travel domestically and internationally, and Directors of
the Investment Manager and sta of the Market Research
subsidiary of the Investment Manager being infected
with the virus. The Board ensured that the Investment
Manager and other service providers had eective Business
Continuity protocols and plans in place. The smooth
operation of the Company through the various restrictions
and lockdowns brought about by COVID-19 have reassured
the Board that operationally speaking the Company is very
robust and can, if necessary, operate eectively without
the need for physical meetings or an oce presence. The
Board, Investment Manager, Administrator, and other
service providers have all demonstrated that they can work
eectively and eciently despite, in many cases, working
remotely for parts of the year.
- Investment:
GovernanceAnnual Report 2022
Viability Statement (continued)
Given the adequate levels of cover set out above, the cash buffer, the liquidity levels and the overall portfolio risk, the
Board has reasonable expectation that the Company can continue in operation and meet its liabilities over the forecast
period.
The Company’s viability depends on the global economy and markets continuing to function. The Board has also
considered the possibility of a wide-ranging collapse in corporate earnings and/or the market value of listed securities.
To the latter point, it should be borne in mind that a significant proportion of the Company’s expenses are in investment
management fees linked to the level of net assets of the Company, which are therefore variable in nature and would
naturally reduce if the market value of the Company’s assets were to fall.
In order to maintain viability, the Company has robust risk controls as set out in the Directors’ Report and the risk
management and control framework have the objectives of monitoring and reducing the likelihood and impact of
operational risks including poor judgement in decision-making, risk-taking that exceeds the levels agreed by the Board,
human error, or control processes being deliberately ignored.
In this context, the Board considers that the prospects for economic activity will remain such that the investment
objective, policy and strategy of the Company will be viable for the foreseeable future and through a period of at least
three years from 30 June 2022.
Key Performance Indicators (“KPIS”)
To ensure the Company meets its objectives the Board evaluates the performance of the Investment Manager at least
at each quarterly Board meeting and takes into the following performance indicators:
Share Capital and Share Buy-Backs
An active discount control mechanism to address the imbalance between the supply of and demand for ordinary shares
using share buy backs is employed by the Broker and monitored by the Board. At the Annual General Meeting (“AGM”)
of the Company held on 1 November 2021, the Company was granted the general authority to purchase in the market
up to 14.99% of the ordinary shares in issue. This authority will expire at the AGM to be held in November 2022.
In the year ended 30 June 2022 661,084 ordinary shares had been bought back and cancelled under the Company’s share
buyback programme. A further 12,737,184 ordinary shares were bought back following the Company’s tender offer in
September 2021. Since the year-end and up to 29 September 2022, being the latest practicable date prior to publication
of the report, the Company bought back and cancelled 205,195 ordinary shares.
Share Buy-Backs to the Year-Ended 30 June 2022
Directors’ Report (continued)
NAV – reviews the performance of the portfolio
Discount to NAV – and reviews the average discount for the Company’s share price against its peer group.
81,832
-
(1,180)
(20,178)
60,474
Opening balance at 1 July
Share issued during the year
Shares repurchased during the year
Tender Oer
Closing balance at 30 June
Number of
Shares
Number of
Shares
USD’000 USD’000
42,623,935
-
(661,084)
(12,7 37,18 4)
29,225,667
50,814,865
-
(605,681)
(7,585,249)
42,623,935
60,474
-
(2,655)
(56,884)
935
30 June 202130 June 2022
43
GovernanceAnnual Report 2022
Substantial Share Interests
The following shareholders owned 5% or more of the shares in issue of the Company, as stated on the share register as at
30 June 2022.
Since 30 June 2022 the Company has not received DTR 5.1.2 notications of holdings.
Notification of Shareholdings
In the year to 30 June 2022 the Company received notications in accordance with Chapter 5 of the DTR (which covers the
acquisition and disposal of major shareholdings and voting rights), of the following changes to voting rights by shareholders
of the Company. It should be noted that for non-UK issuers, the thresholds prescribed under DTR 5.1.2 for notication of
holdings commence at 5% of total voting rights, however notications received below 5% have been received and are
Number of
ordinary shares
Percentage of
total shares in
issue
Shareholder
Lynchwood Nominees Limited
Citibank Nominees (Ireland) Designated Activity Company
The Bank of New York (Nominees) Limited
Vidacos Nominees Limited
Hargreaves Lansdown (Nominees) Limited
Chase Nominees Limited
Euroclear Nominees Limited
Interactive Investor Services Nominees Limited
5,889,152
5,438,957
2,821,510
2,603,438
1,747, 238
1,650,120
1,605,934
1,451,443
20.2
18.6
9.7
8.9
6.0
5.6
5.5
5.0
Number of
voting rights
Percentage of total
voting rights as at
announcement date
Announcement
date
Shareholder
De Pury Pictet Turrettini & Cie SA
City of London Investment Management Company Limited
Euroclear Nominees Limited
City of London Investment Management Company Limited
EdenTree Investment Management
0
3,225,163
5,198,113
2,963,123
1,489,431
0
10.9
17. 5
10.0
5.1
18 August 2021
15 September 2021
21 September 2021
17 December 2021
01 June 2022
44
GovernanceAnnual Report 2022
The Directors are responsible for preparing the Annual
Report and Financial Statements in accordance with
applicable law and regulations.
Company law requires the Directors to prepare nancial
statements for each nancial year. Under that law they are
required to prepare the nancial statements in accordance
with International Financial Reporting Standards as
adopted by the EU and applicable law. Under company law
the Directors must not approve the nancial statements
unless they are satised that they give a true and fair view
of the state of aairs of the Company and of its prot or
loss for that period.
In preparing these nancial statements, the Directors are
required to:
The Directors are responsible for keeping proper
accounting records that are sucient to show and explain
the Company’s transactions and disclose with reasonable
accuracy at any time the nancial position of the Company
and enable them to ensure that its nancial statements
comply with the Companies (Guernsey) Law, 2008. They
are responsible for such internal control as they determine is
necessary to enable the preparation of nancial statements
that are free from material misstatement, whether due to
fraud or error, and have general responsibility for taking
such steps as are reasonably open to them to safeguard
the assets of the Company and to prevent and detect
fraud and other irregularities.
select suitable accounting policies and then apply them
consistently;
make judgements and estimates that are reasonable,
relevant and reliable;
state whether applicable accounting standards have
been followed, subject to any material departures
disclosed and explained in the nancial statements;
assess the Company’s ability to continue as a going
concern, disclosing, as applicable, matters related to
going concern; and
use the going concern basis of accounting unless they
either intend to liquidate the Company or to cease
operations, or have no realistic alternative but to do so.
the nancial statements, prepared in accordance with
the International Financial Reporting Standards as
adopted by the EU (“IFRS”), give a true and fair view
of the assets, liabilities, nancial position and prot or
loss of the Company; and
the Directors’ Report includes a fair review of the
development and performance of the business and
the position of the issuer, together with a description
of the principal risks and uncertainties that they face.
We consider the Annual Report and Financial Statements
taken as a whole, is fair, balanced and understandable
and provides the information necessary for shareholders to
assess the Company’s position and performance, business
model and strategy.
For and on behalf of the Board
The Directors are responsible for the maintenance and
integrity of the corporate and nancial information
included on the Company’s website. Legislation in
Guernsey governing the preparation and dissemination of
nancial statements may dier from legislation in other
jurisdictions.
The Directors who hold oce at the date of approval
of this Director’s Report conrm that so far as they are
aware, there is no relevant audit information of which the
Company’s auditor is unaware, and that each Director has
taken all the steps he ought to have taken as a Director to
make themselves aware of any relevant audit information
and to establish that the Company’s auditor is aware of
that information.
Compliance with Disclosure and Transparency
Directive
We conrm that to the best of our knowledge:
Statement of Directors’ Responsibilities
Hiroshi Funaki
Chairman
30 September 2022
45
GovernanceAnnual Report 2022
46
Valuation of Investments in
securities at fair value
$120,957,996; (2021: $193,108,385)
Refer to page 37 to 38 of the Audit
and Risk Committee report, note
2d accounting policies and note 12
disclosures
Basis:
The Company’s investment portfolio
consists of listed equity securities
trading on the Vietnamese stock
exchange (the “Investments”). These
Investments, carried at a fair value,
are valued by the Company based on
quoted prices in an active market for
that instrument.
Our audit procedures included:
Internal Controls:
We evaluated the design and
implementation of the key control
over the valuation of Investments.
Use of KPMG Specialists:
We engaged our own valuation
specialist to independently price 100%
of Investments to third party pricing
sources.
The risk Our response
Risk:
The valuation of investments, due
to their magnitude in the context of
the nancial statement as a whole, is
considered to be the area which has
the greatest eect on our overall audit
strategy and allocation of resources in
planning and completing our audit.
Assessing disclosures:
We considered the Company’s
disclosures (see notes 2b and 2d) in
relation to the use of estimates and
judgements regarding the valuation
of investments and the Company’s
investment valuation policies and fair
value disclosures in note 12 “Fair Value
Information” for compliance with IFRS.
Our opinion is unmodied
We have audited the nancial statements of VietNam Holding Limited (the “Company”), which comprise the statement of
nancial position as at 30 June 2022, the statements of comprehensive income, changes in equity and cash ows for the
year then ended, and notes, comprising signicant accounting policies and other explanatory information.
In our opinion, the accompanying nancial statements:
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our
responsibilities are described below. We have fullled our ethical responsibilities under, and are independent of the Company
in accordance with, UK ethical requirements including the FRC Ethical Standard as applied to public interest entities. We
believe that the audit evidence we have obtained is a sucient and appropriate basis for our opinion.
Key audit matters: our assessment of the risks of material misstatement
Key audit matters are those matters that, in our professional judgment, were of most signicance in the audit of the
nancial statements and include the most signicant assessed risks of material misstatement (whether or not due to fraud)
identied by us, including those which had the greatest eect on: the overall audit strategy; the allocation of resources in
the audit; and directing the eorts of the engagement team. These matters were addressed in the context of our audit of
the nancial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these
matters. In arriving at our audit opinion above, the key audit matter was as follows (unchanged from 2021):
give a true and fair view of the nancial position of the Company as at 30 June 2022, and of the Company’s nancial
performance and cash ows for the year then ended;
are prepared in accordance with International Financial Reporting Standards as adopted by the EU (“IFRS”); and
comply with the Companies (Guernsey) Law, 2008.
Independent Auditor’s Report
to the Members of VietNam Holding Limited
Financial StatementsAnnual Report 2022
47
Financial StatementsAnnual Report 2022
Our application of materiality and an overview of the scope of our audit
Materiality for the nancial statements as a whole was set at $2,576,000, determined with reference to a benchmark of net
assets of $128,822,167, of which it represents approximately 2.0% (2021: 2.0%).
In line with our audit methodology, our procedures on individual account balances and disclosures were performed to
a lower threshold, performance materiality, so as to reduce to an acceptable level the risk that individually immaterial
misstatements in individual account balances add up to a material amount across the nancial statements as a whole.
Performance materiality for the Company was set at 75% (2021: 75%) of materiality for the nancial statements as a whole,
which equates to $1,932,000. We applied this percentage in our determination of performance materiality because we did
not identify any factors indicating an elevated level of risk.
We reported to the Audit Committee any corrected or uncorrected identied misstatements exceeding $128,000, in addition
to other identied misstatements that warranted reporting on qualitative grounds.
Our audit of the Company was undertaken to the materiality level specied above, which has informed our identication of
signicant risks of material misstatement and the associated audit procedures performed in those areas as detailed above.
Going concern
The directors have prepared the nancial statements on the going concern basis as they do not intend to liquidate the
Company or to cease its operations, and as they have concluded that the Company’s nancial position means that this is
realistic. They have also concluded that there are no material uncertainties that could have cast signicant doubt over its
ability to continue as a going concern for at least a year from the date of approval of the nancial statements (the “going
concern period”).
In our evaluation of the directors’ conclusions, we considered the inherent risks to the Company’s business model and
analysed how those risks might aect the Company’s nancial resources or ability to continue operations over the going
concern period. The risk that we considered most likely to aect the Company’s nancial resources or ability to continue
operations over this period was availability of capital to meet operating costs and other nancial commitments.
We considered whether this risk could plausibly aect the liquidity in the going concern period by comparing severe, but
plausible downside scenarios that could arise from this risk against the level of available nancial resources indicated by the
Company’s nancial forecasts.
We considered whether the going concern disclosure in note 2(b) to the nancial statements gives a full and accurate
description of the directors’ assessment of going concern.
Our conclusions based on this work:
48
we consider that the directors’ use of the going concern basis of accounting in the preparation of the nancial
statements is appropriate;
we have not identied, and concur with the directors’ assessment that there is not, a material uncertainty related to
events or conditions that, individually or collectively, may cast signicant doubt on the Company’s ability to continue
as a going concern for the going concern period; and
we have nothing material to add or draw attention to in relation to the directors’ statement in the notes to the
nancial statements on the use of the going concern basis of accounting with no material uncertainties that may cast
signicant doubt over the Company’s use of that basis for the going concern period, and that statement is materially
consistent with the nancial statements and our audit knowledge.
However, as we cannot predict all future events or conditions and as subsequent events may result in outcomes that are
inconsistent with judgements that were reasonable at the time they were made, the above conclusions are not a guarantee
that the Company will continue in operation.
Financial StatementsAnnual Report 2022
Fraud and breaches of laws and regulations – ability to detect
Identifying and responding to risks of material misstatement due to fraud
To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could indicate
an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessment procedures
included:
Identifying and responding to risks of material misstatement due to non-compliance with laws and regulations
We identied areas of laws and regulations that could reasonably be expected to have a material eect on the nancial
statements from our sector experience and through discussion with management (as required by auditing standards),
and from inspection of the Company’s regulatory and legal correspondence, if any, and discussed with management the
policies and procedures regarding compliance with laws and regulations. As the Company is regulated, our assessment of
risks involved gaining an understanding of the control environment including the entity’s procedures for complying with
regulatory requirements.
The Company is subject to laws and regulations that directly aect the nancial statements including nancial reporting
legislation and taxation legislation and we assessed the extent of compliance with these laws and regulations as part of our
procedures on the related nancial statement items.
The Company is subject to other laws and regulations where the consequences of non-compliance could have a material
eect on amounts or disclosures in the nancial statements, for instance through the imposition of nes or litigation or
impacts on the Company’s ability to operate. We identied nancial services regulation as being the area most likely to have
such an eect, recognising the regulated nature of the Company’s activities and its legal form. Auditing standards limit
the required audit procedures to identify non-compliance with these laws and regulations to enquiry of management and
inspection of regulatory and legal correspondence, if any. Therefore if a breach of operational regulations is not disclosed
to us or evident from relevant correspondence, an audit will not detect that breach.
Context of the ability of the audit to detect fraud or breaches of law or regulation
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material
misstatements in the nancial statements, even though we have properly planned and performed our audit in accordance
with auditing standards. For example, the further removed non-compliance with laws and regulations is from the events
and transactions reected in the nancial statements, the less likely the inherently limited procedures required by auditing
standards would identify it.
As required by auditing standards, we perform procedures to address the risk of management override of controls, in
particular the risk that management may be in a position to make inappropriate accounting entries. On this audit we do
not believe there is a fraud risk related to revenue recognition because the Company’s revenue streams are simple in nature
with respect to accounting policy choice, and are easily veriable to external data sources or agreements with little or no
requirement for estimation from management. We did not identify any additional fraud risks.
We performed procedures including
enquiring of management as to the Company’s policies and procedures to prevent and detect fraud as well as enquiring
whether management have knowledge of any actual, suspected or alleged fraud;
reading minutes of meetings of those charged with governance; and
using analytical procedures to identify any unusual or unexpected relationships.
Identifying journal entries and other adjustments to test based on risk criteria and comparing any identied entries to
supporting documentation; and
incorporating an element of unpredictability in our audit procedures.
Independent Auditor’s Report
to the Members of VietNam Holding Limited (continued)
49
Financial StatementsAnnual Report 2022
In addition, as with any audit, there remains a higher risk of non-detection of fraud, as this may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are designed to detect
material misstatement. We are not responsible for preventing non-compliance or fraud and cannot be expected to detect
non-compliance with all laws and regulations.
Other information
The directors are responsible for the other information. The other information comprises the information included in the annual
report but does not include the nancial statements and our auditor’s report thereon. Our opinion on the nancial statements
does not cover the other information and we do not express an audit opinion or any form of assurance conclusion thereon.
In connection with our audit of the nancial statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the nancial statements or our knowledge obtained
in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that
there is a material misstatement of this other information, we are required to report that fact. We have nothing to report
in this regard.
Disclosures of emerging and principal risks and longer term viability
We are required to perform procedures to identify whether there is a material inconsistency between the directors’
disclosures in respect of emerging and principal risks and the viability statement, and the nancial statements and our
audit knowledge. we have nothing material to add or draw attention to in relation to:
We are also required to review the Viability Statement, set out on page 41 - 43 under the Listing Rules. Based on the above
procedures, we have concluded that the above disclosures are materially consistent with the nancial statements and our
audit knowledge.
Corporate governance disclosures
We are required to perform procedures to identify whether there is a material inconsistency between the directors’ corporate
governance disclosures and the nancial statements and our audit knowledge.
Based on those procedures, we have concluded that each of the following is materially consistent with the nancial
statements and our audit knowledge:
the directors’ conrmation within the Viability Statement (page 41 - 43) that they have carried out a robust assessment
of the emerging and principal risks facing the Company, including those that would threaten its business model, future
performance, solvency or liquidity;
the emerging and principal risks disclosures describing these risks and explaining how they are being managed or
mitigated;
the directors’ explanation in the Viability Statement (page 41 - 43) as to how they have assessed the prospects of
the Company, over what period they have done so and why they consider that period to be appropriate, and their
statement as to whether they have a reasonable expectation that the Company will be able to continue in operation
and meet its liabilities as they fall due over the period of their assessment, including any related disclosures drawing
attention to any necessary qualications or assumptions.
the directors’ statement that they consider that theannual report and nancial statements taken as a whole is fair,
balanced and understandable, and provides the information necessary for shareholders to assess theCompany’s
position and performance, business model and strategy;
the section of theannual report describing the work of the Audit Committee, including the signicant issues that the
audit committee considered in relation to the nancial statements, and how these issues were addressed; and
the section of theannual report that describes the review of the eectiveness of theCompany’s risk management and
internal control systems.
50
Financial StatementsAnnual Report 2022
Corporate governance disclosures (continued)
We are required to review the part of Corporate Governance Statement relating to the Company’s compliance with the
provisions of the UK Corporate Governance Code specied by the Listing Rules for our review. We have nothing to report in
this respect.
We have nothing to report on other matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies (Guernsey) Law, 2008 requires us to
report to you if, in our opinion:
Respective responsibilities
Directors’ responsibilities
As explained more fully in their statement set out on page 45, the directors are responsible for: the preparation of the
nancial statements including being satised that they give a true and fair view; such internal control as they determine
is necessary to enable the preparation of nancial statements that are free from material misstatement, whether due to
fraud or error; assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to
going concern; and using the going concern basis of accounting unless they either intend to liquidate the Company or to
cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities
Our objectives are to obtain reasonable assurance about whether the nancial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue our opinion in an auditor’s report. Reasonable assurance
is a high level of assurance, but does not guarantee that an audit conducted in accordance with ISAs (UK) will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in aggregate, they could reasonably be expected to inuence the economic decisions of users taken on the
basis of the nancial statements.
A fuller description of our responsibilities is provided on the FRC’s website at www.frc.org.uk/auditorsresponsibilities.
The purpose of this report and restrictions on its use by persons other than the Company’s members as a body
This report is made solely to the Company’s members, as a body, in accordance with section 262 of the Companies
(Guernsey) Law, 2008. Our audit work has been undertaken so that we might state to the Company’s members those
matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by
law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members, as a body,
for our audit work, for this report, or for the opinions we have formed.
the Company has not kept proper accounting records; or
the nancial statements are not in agreement with the accounting records; or
we have not received all the information and explanations, which to the best of our knowledge and belief are necessary
for the purpose of our audit.
Andrew J. Salisbury
For and on behalf of KPMG Channel Islands Limited
Chartered Accountants and Recognised Auditors
Guernsey
30 September 2022
Independent Auditor’s Report
to the Members of VietNam Holding Limited (continued)
51
Financial StatementsAnnual Report 2022
Liabilities
Payables on purchase of investments
Accrued expenses
Assets
Non-current assets
Investments at fair value through prot or loss 193,108,3853
Current assets
Cash and cash equivalents
Prepayments
Accrued dividends and interest
Receivables on sale of investments
6,031,337
9,290
30,153
1,239,041
8,160,681
-
58,772
-
Equity
Share capital
Reserve for own shares
Retained earnings
166,645,041
135,606,219
166,645,041
127,886,909
5
5
3,905,824
431,912
-
355,282
Total non-current assets 193,108,385120,957,996
Total current assets 7,309,8 2 18,219,453
Total assets
200,418,20612 9,177,4 49
Total equity 196,080,470128,822,167
2021
USD
2022
USD
Notes
Statement of Financial Position
The nancial statements on pages 52 to 69 were approved by the Board of Directors on 30 September 2022 and were signed
on its behalf by
The accompanying notes on pages 56 to 69 form an integral part of these nancial statements.
Total liabilities 4,337,7 3 6355,282
Total equity and liabilities 200,418,20612 9,177,4 49
Philip Scales
Chairman of the Audit and Risk Committee
Hiroshi Funaki
Chairman of the Board of Directors
120,957,996
(106,170,790)
(165,709,783)
52
Financial StatementsAnnual Report 2022
Investment management fees
Advisory fees
Directors’ fees and expenses
Custodian fees
Administrative and accounting fees
Audit fees
Other expenses
Dividend income from equity securities at fair value through prot or loss
Net gain/(loss) from investments at fair value through prot or loss
Net foreign exchange (loss)/gain
Interest income from investments at fair value through prot or loss
Other income
2,390,216
100,730,119
694,162
163,128
1,811,555
-
-
7
2,438,087
111,579
328,690
146,875
219,271
78,758
498,581
2,737,8 04
15,715
385,292
152,863
216,939
71,428
672,053
8
8
9
10
Net investment gain/(loss) 103,975,729(3,4 67, 2 16)
Total operating expenses 3,821,8414,252,094
Income/(loss) for the year 100,153,888(7,719,310)
(7,719,310)
Other comprehensive income
Total comprehensive income/(loss) for the year
-
100,153,888
-
2021
USD
2022
USD
Notes
Statement of Comprehensive Income
Basic and diluted earnings per share 2.19(0.24)14
The accompanying notes on pages 56 to 69 form an integral part of these nancial statements.
(1,896)
(5,211,105)
(67,666)
53
Financial StatementsAnnual Report 2022
Balance at 1 July 2020
Total comprehensive income for the year
Change in net assets attributable to shareholders
117, 284,304
100,153,888
35,452,331
100,153,888
(84,813,068)
-
166,645,041
-
Balance at 1 July 2021
Total comprehensive loss for the year
Change in net assets attributable to shareholders
196,080,470135,606,219(106,170,790)
-
166,645,041
-
Transactions in shares
Repurchase of own shares
(21,357,72 2)-(21,357,72 2)-
Transactions in shares
Repurchase of own shares (59,538,993)-(59,538,993)
(59,538,993)
-
Total comprehensive income for the year 100,153,888100,153,888--
Total transactions in shares (21,357,722)-(21, 357,72 2)-
Balance at 30 June 2021 196,080,470135,606,219(106,170,790)166,645,041
Total comprehensive loss for the year --
Total transactions in shares (59,538,993)--
Balance at 30 June 2022 128,822,167127,886,909(165,709,783)166,645,041
Share
capital
USD
Reserve for
own shares
USD
Total
USD
Retained
earnings
USD
The accompanying notes on pages 56 to 69 form an integral part of these nancial statements.
Statement of Changes in Equity
(7,719,310)(7,719,310)
(7,719,310)(7,719,310)
54
Financial StatementsAnnual Report 2022
Cash ows from operating activities
Total comprehensive income/(loss) for the year
Adjustments to reconcile total comprehensive income/(loss)
to net cash from operating activities:
Dividend income
Interest income
Net loss/(gain) from investments at fair value through prot or loss
Net foreign exchange loss
Purchase of investments
Proceeds from sale of investments
Changes in working capital
Decrease/(increase) in receivables on sale of investments
(Decrease)/increase in payables on purchase of investments
(Decrease)/increase in accrued expenses
Decrease/(increase) in prepayments
Dividends received
Interest received
24,829,782
3,472,060
2,561,173
(21,357,72 2)
6,031,337
100,153,888
7
61,736,003
(59,538,993)
2,197,010
6,031,337
(67,666)
(59,538,993)
8,160,681
(7,719,310)
1,896
110,054,346
3,728,278
146,408
2,392,036
786,115
(1,811,555)
-
5,211,105
67,666
(78,323,705)
145,262,989
1,239,041
(3,905,824)
(76,630)
9,290
1,690,983
91,953
Net cash from operating activities
Cash ows used in nancing activities
Repurchase of own shares
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of the year
Eect of exchange rate uctuations on cash held
Net cash used in nancing activities
Cash and cash equivalents at end of the year
2021
USD
2022
USD
Notes
The accompanying notes on pages 56 to 69 form an integral part of these nancial statements.
Statement of Cash Flows
(2,390,216)
(694,162)
(100,730,119)
(87,370,357)
(1,239,041)
(9,290)
(21,357,72 2)
(1,896)
55
Financial StatementsAnnual Report 2022
1. The Company
VietNam Holding Limited (the “Company”) is a closed-end investment company that was incorporated in the Cayman
Islands on 20 April 2006 as an exempted company with limited liability under registration number 166182. On 25 February
2019, the Company, via a process of cross-border continuance, transferred its legal domicile from the Cayman Islands
to Guernsey and was registered as a closed-ended company limited by shares incorporated in Guernsey with registered
number 66090.
On 8 March 2019 the Company’s ordinary shares were cancelled from trading on AIM and admitted to the Premium segment
of the ocial list of the UK Listing Authority (“Ocial List”) and trading on the main market of the London Stock Exchange
(“Main Market”). On the same date the Company’s shares were admitted to listing and trading on the Ocial List of The
International Stock Exchange (“TISE”).
The investment objective of the Company is to achieve long-term capital appreciation by investing in a diversied portfolio
of companies that have high growth potential at an attractive valuation.
At the Extraordinary General Meeting held on 31 October 2018 the Shareholders voted in favour of the continuance
resolution, authorising the Company to operate in its current form through to the 2023 Annual General Meeting when a
similar resolution will be put forward for Shareholders’ approval.
Dynam Capital, Ltd has been appointed as the Company’s Investment Manager and is responsible for the day-to-day
management of the Company’s investment portfolio in accordance with the Company’s investment policies, objectives
and restrictions.
Sanne Group (Guernsey) Limited is the Company’s administrator.
Standard Chartered Bank (Singapore) Limited and Standard Chartered Bank (Vietnam) Limited are the custodian and the
sub-custodian respectively. Standard Chartered Bank (Singapore) Limited is also the sub-administrator.
The registered oce of the Company is De Catapan House, Grange Road, St Peter Port, Guernsey, GY1 2QG.
2. Signicant Accounting Policies
(a) Statement of compliance
These nancial statements, which give a true and fair view, have been prepared in accordance with the International
Financial Reporting Standards (“IFRSs”) as adopted by the European Union and comply with the Companies (Guernsey)
Law, 2008.
(b) Basis of preparation
The nancial statements are presented in United States dollars (“USD”), which is the Company’s functional currency. The
nancial statements have been prepared on a going concern basis, applying the historical cost convention, except for the
measurement of investments at fair value through prot or loss.
Going concern
The Directors have reasonable expectations and are satised that the Company has adequate resources to continue its
operations and meet its commitments for the foreseeable future and they continue to adopt the going concern basis for
the preparation of the nancial statements. In making this statement, the Directors conrm the Company’s forecasts
and projections have been stress tested taking into account the potential for (i) asset value declines, (ii) declines in
cash dividends from equities held in the portfolio and (iii) share buybacks and tender oers. The Directors note that the
underlying liquidity of Vietnamese stocks has increased over the last twelve months with average daily traded volumes
increasing by as much as 5x the level of the prior year. The Directors also note that the portfolio is composed of a higher
percentage of larger and more liquid stocks than in the prior year. Lastly, the Directors note that at year-end the portfolio
56
Notes to the Financial Statements
Financial StatementsAnnual Report 2022
is comprised of cash and quoted stocks only. The Company’s liquidity position, taking into account cash held and with the
ability to sell underlying assets to meet share buybacks, tenders and to meet the operating costs of the Company, shows
that the Company is able to operate with appropriate liquidity and be able to meet its liabilities as they fall due. The fund
has a formal continuation vote in 2023 and it is the current intention of the Board to table a continuation resolution at the
2023 Annual General meeting. The Directors therefore have a reasonable expectation that the Company will have adequate
resources to continue its operations for the foreseeable future. Thus, they continue to adopt the going concern basis of
accounting in preparing the nancial statements.
Critical accounting estimates and judgements
The preparation of nancial statements in accordance with IFRS as adopted by the European Union requires management
to make judgements, estimates and assumptions that aect the application of policies and the reported amounts of assets
and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and
various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of
making judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual
results may dier from these estimates.
The estimated and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimates are revised if the revision aects only that period or in the period of the
revision and future periods if the revision aects both current and future periods.
The estimates and assumptions that have a signicant risk of causing a material adjustment to the carrying amounts of
assets and liabilities within the next nancial year are discussed below.
Functional currency
The Company’s shares were issued in USD and the listing of the shares on the Main Market and TISE is in USD. The performance
of the Company is measured and reported to the investors in USD, although the primary activity of the Company is to invest
in the Vietnamese market. The Board considers the USD as the currency that most faithfully represents the economic eects
of the underlying transactions, events and conditions.
Fair value of financial instruments
The fair value of nancial instruments that are not traded in an active market is determined by using valuation techniques.
The Company uses its judgement to select a variety of methods and make assumptions that are mainly based on market
conditions existing at each reporting date.
(c) Foreign currency translation
Transactions in foreign currencies other than the functional currency are translated at the applicable rates on the dates
of the transactions. Monetary assets and liabilities denominated in foreign currencies are re-translated to USD at the
applicable rates on the year-end date. Foreign currency exchange dierences arising on translation and realised gains
and losses on disposals or settlements of monetary assets and liabilities are included in the Statement of Comprehensive
Income. Foreign currency exchange dierences relating to investments at fair value through prot or loss are included in
the realised and unrealised gains and losses on those investments within “Net gain/(loss) from investments at fair value
through prot or loss” on the Statement of Comprehensive Income. All other foreign currency exchange dierences relating
to other monetary items, including cash and cash equivalents, are included in net foreign exchange gains and losses in the
Statement of Comprehensive Income.
(d) Financial instruments
A nancial instrument is any contract that gives rise to a nancial asset of one entity and a nancial liability or equity
instrument of another entity.
2. Signicant Accounting Policies (continued)
Notes to the Financial Statements
(continued)
57
Financial StatementsAnnual Report 2022
58
(i) Classification
In accordance with IFRS 9, the Company classies its nancial assets and nancial liabilities at initial recognition into the
categories of nancial assets and nancial liabilities discussed below.
Financial assets
The Company classies its nancial assets as subsequently measured at amortised cost or measured at fair value through
prot or loss on the basis of both:
Financial assets measured at amortised cost
A nancial asset is measured at amortised cost if it is held within a business model whose objective is to hold nancial assets
in order to collect contractual cash ows and its contractual terms give rise on specied dates to cash ows that are solely
payments of principal and interest on the principal amount outstanding. The Company includes in this category accrued
income, cash and cash equivalents and receivables on sale of investments.
Financial assets measured at fair value through profit or loss (“FVTPL”)
A nancial asset is measured at fair value through prot or loss if:
The Company measures all its investments at FVTPL.
(ii) Recognition and initial measurement
Financial assets and liabilities at fair value through prot or loss are recognised initially on the trade date, which is the date
that the Company becomes a party to the contractual provisions of the instrument. Other nancial assets and liabilities are
recognised on the date they are originated.
Financial assets and nancial liabilities at fair value through prot or loss are recognised initially at fair value, with transaction
costs recognised in the Statement of Comprehensive Income. Financial assets or nancial liabilities not at fair value through
prot or loss are recognised initially at fair value plus transaction costs that are directly attributable to their acquisition or issue.
(iii) Subsequent measurement
After initial measurement, the Company measures nancial instruments which are classied as FVTPL at fair value.
Subsequent changes in the fair value of those nancial instruments are recorded in net gain or loss on nancial assets and
liabilities at FVTPL in the Statement of Comprehensive Income. Interest and dividends earned or paid on these instruments
are recorded separately in interest income or expense and dividend income in the Statement of Comprehensive Income.
(iv) Derecognition
A nancial asset is derecognised when the Company no longer has control over the contractual rights that comprise that
asset. This occurs when the rights are realised, expire or are surrendered.
The entity’s business model for managing the nancial assets
The contractual cash ow characteristics of the nancial assets
Its contractual terms do not give rise to cash ows on specied dates that are solely payments of principal and interest
(SPPI) on the principal amount outstanding; or
It is not held within a business model whose objective is either to collect contractual cash ows, or to both collect
contractual cash ows and sell; or
At initial recognition, it is irrevocably designated as measured at FVTPL when doing so eliminates or signicantly
reduces a measurement or recognition inconsistency that would otherwise arise from measuring assets or liabilities or
recognising the gains and losses on them on dierent bases.
(a)
(b)
(c)
Financial StatementsAnnual Report 2022
Financial assets that are sold are derecognised, and the corresponding receivables from the buyer for the payment are
recognised on the trade date, being the date the Company commits to sell the assets.
A nancial liability is derecognised when the obligation specied in the contract is discharged, cancelled or expired.
(v) Fair value measurement
‘Fair value’ is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date in the principal or, in its absence, the most advantageous market to which
the Company has access at that date. The fair value of a liability reects its non-performance risk.
When available, the Company measures the fair value of an instrument using the quoted price in an active market for that
instrument. A market is regarded as ‘active’ if transactions for the asset or liability take place with sucient frequency and
volume to provide pricing information on an ongoing basis. The Company measures instruments quoted in an active market
at the last traded price.
If there is no quoted price in an active market, then the Company uses valuation techniques that maximise the use of
relevant observable inputs and minimise the use of unobservable inputs. The chosen valuation technique incorporates all of
the factors that market participants would consider in pricing a transaction.
The Company recognises transfers between levels of the fair value hierarchy as at the end of the reporting period during
which the change has occurred.
Any increases or decreases in fair value are recognised in the Statement of Comprehensive Income as an unrealised gain or
loss from investments at FVTPL.
(vi) Impairment of financial assets
At each reporting date, the Company measures the loss allowance on nancial assets carried at amortised cost at an
amount equal to the lifetime expected credit losses if the credit risk has increased signicantly since initial recognition. If,
at the reporting date, the credit risk has not increased signicantly since initial recognition, the Company measures the
loss allowance at an amount equal to 12-month expected credit losses. The expected credit losses are estimated using
a provision matrix based on the Company’s historical credit loss experience adjusted for factors that are specic to the
accounts receivables, general economic conditions and an assessment of both the current as well as the forecast direction
of conditions at the reporting date, including time value of money where appropriate. The measurement of expected credit
losses is a function of the probability of default, loss given default (i.e. the magnitude of the loss if there is a default) and
exposure at the default. The assessment of the probability of default and loss given default is based on historical data
adjusted by forward-looking information.
(vii) Cash and cash equivalents
Cash comprises current deposits with banks. Cash equivalents are short-term highly liquid investments that are readily
convertible to known amounts of cash, are subject to an insignicant risk of changes in value, and are held for the purpose
of meeting short-term cash commitments rather than for investment or other purposes.
(e) Offsetting
Financial assets and liabilities are oset and the net amount is reported in the Statement of Financial Position when, and
only when, the Company has a legally enforceable right to set o the recognised amounts and the transactions are intended
to be settled on a net basis or simultaneously, e.g. through a market clearing mechanism.
(f) Share capital
Ordinary shares
Ordinary shares are classied as equity. Incremental costs directly attributable to the issue of ordinary shares are recognised
as a deduction from equity, net of any tax eects.
2. Signicant Accounting Policies (continued)
Notes to the Financial Statements
(continued)
59
Financial StatementsAnnual Report 2022
60
Repurchase, disposal and reissue of share capital (treasury shares)
Where the Company purchases its own share capital, the consideration paid, which includes any directly attributable costs,
is recognised as a deduction from equity shareholders’ funds through the Company’s reserves for own shares. The reserves
for own shares represents share capital which can be reissued in the future or subsequently cancelled. When such shares
are subsequently sold or re-issued to the market any consideration received, net of any directly attributable incremental
transaction costs, is recognised as an increase in equity shareholders’ funds through the reserve of own shares account. The
Directors have cancelled all the shares repurchased during the current and the previous year.
(g) Tax
Tax expense comprises current tax. Current tax is recognised in the Statement of Comprehensive Income except to the
extent that it relates to items recognised directly in equity or in other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or
substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
The Company is a tax resident in Guernsey and is subject to the standard rate of 0% on taxable income.
The Company is liable to Vietnamese transactional tax of 0.1% (2021: 0.1%) on the sales proceeds of the onshore sale of
equity investments. The related taxes on onshore sales proceeds are accounted for at net amount in the Statement of
Comprehensive Income.
(h) Interest income and expense
Interest income and expense is recognised in the Statement of Comprehensive Income using the eective rate method. The
eective interest rate method is a method of calculating the amortised cost of a nancial asset or nancial liability and of
allocating the interest income or interest expense over the relevant period. The eective interest rate is the rate that exactly
discounts estimated future cash payments or receipts throughout the expected life of the nancial instrument – or, when
appropriate, a shorter period – to the net carrying amount of the nancial asset or nancial liability.
When calculating the eective interest rate, the Directors estimate cash ows considering all contractual terms of the
nancial instrument but do not consider future credit losses. The calculation includes all fees and points paid or received
between parties to the contract that are an integral part of the eective interest rate, transaction costs and all other
premiums or discounts.
(i) Dividend income
Dividend income is recognised in the Statement of Comprehensive Income on the date on which the right to receive
payment is established. For listed equity securities, this is usually the ex-dividend date. Dividend income from equity
securities designated as at fair value through prot or loss is recognised in the Statement of Comprehensive Income as a
separate line item.
(j) Fee and commission expense
Fees and commission expenses are recognised in the Statement of Comprehensive Income as the related services are
performed.
(k) Earnings per share
The Company presents basic and diluted earnings per share data for its ordinary shares. Basic earnings per share is
calculated by dividing the prot or loss attributable to ordinary shareholders of the Company by the weighted average
number of ordinary shares outstanding during the year, adjusted for own shares held.
3. Financial Instruments and Associated Risks
Financial assets of the Company include investments at fair value through prot or loss, cash and cash equivalents,
receivables on sale of investments, and accrued dividends and interest. Financial liabilities comprise payables on purchase
of investments and accrued expenses. Accounting policies for nancial assets and liabilities are set out in note 2.
Financial StatementsAnnual Report 2022
98.48
-
98.48
Investments in listed securities
Investments in unlisted securities
Fair value
in USD
2021
Fair value
in USD
% of
net assets
% of
net assets
120,957,996
—
120,957,996
193,108,385
-
193,108,385
93.90
—
93.90
The Company’s investment activities expose it to various types of risk that are associated with the nancial instruments
and the markets in which it invests. The most important types of nancial risk to which the Company is exposed are market
risk (which includes price risk, currency risk, and interest rate risk), credit risk and liquidity risk.
Asset allocation is determined by the Company’s Investment Manager who manages the distribution of the assets to
achieve the investment objectives. Divergence from target asset allocations and the composition of the portfolio is
monitored by the Investment Manager.
Market risk
Market risk is the risk that the value of a nancial asset will uctuate as a result of changes in market prices (e.g. interest
rates, foreign exchange rates, equity prices and credit spreads) whether or not those changes are caused by factors
specic to the individual asset or factors aecting all assets in the market. The Company is exposed to market risk within
its investments purchased in the Vietnamese market.
The overall market positions are monitored continuously by the Investment Manager and at least quarterly by the Board.
The Company’s investments in securities are exposed to market risk and are disclosed by the following generic investment
types:
At 30 June 2022, a 5% reduction in the market value of the portfolio would have led to a reduction in NAV and prot or
loss of USD 6,047,900 (2021: USD 9,655,419). A 5% increase in market value would have led to an equal and opposite eect
on NAV and prot or loss.
Currency risk
The Company may invest in nancial instruments and enter into transactions denominated in currencies other than its
functional currency. Consequently, the Company is exposed to risks that the exchange rate of its currency relative to
other currencies may change and have an adverse eect on the value of the Company’s nancial assets or liabilities
denominated in currencies other than USD.
The Company’s net assets are calculated every month based on the most up to date exchange rates while the general
economic and foreign currency environment is continuously monitored by the Investment Manager and reviewed by the
Board at least once each quarter.
The Company may enter into arrangements to hedge currency risks if such arrangements become desirable and practicable
in the future in the interest of ecient portfolio management.
3. Financial Instruments and Associated Risks (continued)
Notes to the Financial Statements
(continued)
2022
61
Financial StatementsAnnual Report 2022
As at 30 June 2022, the Company had the following foreign currency exposures:
At 30 June 2022, a 5% reduction in the value of the Vietnamese Dong, Pound Sterling, Swiss Franc, Euro versus the US Dollar
would have led to a reduction in NAV and prot or loss of USD 6,411,755 (2021: USD 9,768,949), USD 31,607 (2021: USD 195),
USD 8 (2021: USD 131) and USD 225 (2021: USD 2,705) respectively. A 5% increase in value would have led to an equal and
opposite eect.
Interest rate risk
Interest rate risk is the risk that the future cash ows of a nancial instrument will uctuate because of changes in market
interest rates.
The majority of the Company’s nancial assets are non-interest-bearing. Interest-bearing nancial assets and interest-
bearing nancial liabilities mature or reprice in the short-term, no longer than twelve months. As a result, the Company is
subject to limited exposure to interest rate risk due to uctuations in the prevailing levels of market interest rates.
Credit risk
Credit risk is the risk that a counterparty to a nancial instrument will fail to discharge an obligation or commitment that
it has entered with the Company.
At 30 June 2022, the following nancial assets were exposed to credit risk (including settlement risk): cash and cash
equivalents, receivables on sale of investments and accrued dividends and interest. The total amount of nancial assets
exposed to credit risk amounted to USD 8,219,453 (2021: USD 7,300,531).
Substantially all the assets of the Company are held by the Company’s custodian, Standard Chartered Bank (Singapore)
Limited. Bankruptcy or insolvency of the custodian may cause the Company’s rights with respect to cash and securities
held by the custodian to be delayed or limited. The Company monitors its risk by monitoring the credit quality and nancial
positions of the custodian the Company uses.
As at 30 June 2022, the Company’s custodian, Standard Chartered Bank (Singapore) Limited, was rated as A by Standard
and Poor’s, A1 by Moody’s and A+ by Fitch (2021: A by Standard and Poor’s, A1 by Moody’s and A+ by Fitch).
Financial assets subject to IFRS 9’s impairment requirements
The Company’s nancial assets subject to the expected credit loss model within IFRS 9 are cash and cash equivalents,
and short-term receivables, including accrued dividends and interest, and receivables on sale of investments. As at 30
June 2022, the total of cash and cash equivalents, and short-term receivables was USD 8,219,453 (2021: USD 7,300,531).
The Directors assessed the lifetime expected credit loss as at 30 June 2022 and concluded it to be immaterial (2021: loss
immaterial). There is not considered to be any concentration of credit risk within these assets. No assets are considered
impaired and no amounts have been written o in the year.
All short-term receivables are expected to be received in three months or less. An amount is considered to be in default if
it has not been received 30 days after it is due.
2022
USD
2021
USD
Vietnamese Dong
Pound Sterling
Swiss Franc
Euro
195,378,974
3,903
2,628
54,097
195,439,602
128,235,094
632,133
163
4,497
128,871,887
Fair value
62
Financial StatementsAnnual Report 2022
Cash and cash equivalents
Investment at fair value through prot and loss
Accrued dividends
Total nancial assets
Accrued expenses
Total nancial liabilities
Cash and cash equivalents
Investment at fair value through prot and loss
Accrued dividends
Receivables on sale of investments
Total nancial assets
Payables in purchase of investments
Accrued expenses
Total nancial liabilities
Total
USD
2022
2021
No xed
maturity
USD
Over
3 months
to 5 years
USD
1 to 3
months
USD
On demand
USD
0 to 1
month
USD
8,160,681
120,957,996
58,772
129,177,449
355,282
355,282
—
120,957,996
—
120,957,996
—
—
—
—
—
—
—
—
—
—
58,772
58,772
355,282
355,282
8,160,681
—
—
8,160,681
—
—
6,031,337
—
—
—
6,031,337
—
—
—
—
—
—
1,239,041
1,239,041
3,905,824
—
3,905,824
—
—
30,153
—
30,153
—
431,912
431,912
—
193,108,385
—
—
193,108,385
—
—
—
6,031,337
193,108,385
30,153
1,239,041
200,408,916
3,905,824
431,912
4,337,736
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Liquidity risk
The Company, a closed-end investment company, invests in companies through listings on the Vietnam stock exchanges.
There is no guarantee however that the Vietnam stock exchanges will provide liquidity for the Company’s investments.
The Company’s overall liquidity risks are monitored on at least a quarterly basis by the Board. The Company is a closed-end
investment company so Shareholders cannot repurchase their shares directly from the Company.
The Board has considered that there may be periods of time when parts of the portfolio are prone to higher liquidity risk,
but is satised overall that the xed liabilities of the Company can be met by income or from selling sucient marketable
securities even at periods of higher illiquidity.
Payables on purchase of investments and accrued expenses are generally payable within one year.
The table below summarises the maturity prole of the Company’s nancial assets and liabilities based on contractual
undiscounted receipts and payments:
An operating segment is a component of the Company that engages in business activities from which it may earn
revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company’s
other components. The Company is engaged in a single segment of business, being investment in Vietnam. The Board,
as a whole, has been determined as constituting the chief operating decision maker of the Company. The key measure of
performance used by the Board to assess the Company’s performance and to allocate resources is the total return on the
Company’s NAV calculated as per the prospectus.
3. Financial Instruments and Associated Risks (continued)
4. Operating Segments
Notes to the Financial Statements
(continued)
63
Financial StatementsAnnual Report 2022
64
Information on gains and losses derived from investments are disclosed in the Statement of Comprehensive Income.
The Company is domiciled in Guernsey, Channel Islands. Entity wide disclosures are provided as the Company is engaged
in a single segment of business, investing in Vietnam. In presenting information on the basis of geographical segments,
segment investments and the corresponding segment net investment income arising thereon are determined based on the
country of domicile of the respective investment entities.
In line with the Company’s investment policy, the Company may invest:
As of 30 June 2022, no individual investment exceeded 20% of the net assets attributable to Shareholders (2021: none).
All of the Company’s investments in securities at fair value are in Vietnam as at 30 June 2022 and 30 June 2021. All of the
Company’s investment income can be attributed to Vietnam for the years ended 30 June 2022 and 30 June 2021.
Ordinary shares of USD 1 each
Pursuant to its redomiciliation to Guernsey, the Company re-registered with an authorised share capital of USD 200,000,000
divided into 200,000,000 shares of a nominal or par value of USD 1.00 each. In line with the Company’s new Articles of
Incorporation, the Company may from time to time repurchase all or any portion of the shares held by the Shareholders
upon giving notice of not less than 30 calendar days.
On 8 March 2019 the Company’s ordinary shares were cancelled from trading on AIM and admitted to the Premium
segment of the Ocial List and trading on the Main Market. On the same date the Company’s shares were admitted to
listing and trading on the TISE.
As a result, as at 30 June 2022 the Company has 29,225,667 (2021: 42,623,935) ordinary shares with voting rights in issue
(excluding the reserve for own shares), and Nil (2021: Nil) are held as reserve for own shares.
Reserve for own shares
Reserve for own shares are the Company’s own shares which had been repurchased. The amount represents share capital
which can be reissued in the future or subsequently cancelled. All reserves are available for distribution subject to a
solvency assessment.
Total shares issued and fully paid (after repurchases and cancellations) at beginning of the year
Shares issued upon exercise of warrants during the year
Shares cancellation
Repurchased and reserved for own shares
At beginning of the year
During the year
Shares reissued to ordinary shares
Shares cancellation
Total outstanding ordinary shares with voting rights
2022
No. of shares
2021
No. of shares
50,814,865
—
(8,190,930)
42,623,935
—
(8,190,930)
—
8,190,930
42,623,935
42,623,935
—
(13,398,268)
29,225,667
—
(13,398,268)
—
13,398,268
29,225,667
up to 25% of its NAV (at the time of investment) in companies with shares traded outside of Vietnam if a majority of
their assets and/or operations are based in Vietnam;
up to 20% of its NAV (at the time of investment) in direct private equity investments; and
up to 20% of its NAV (at the time of investment) in other listed investment funds and holding companies which have
the majority of their assets in Vietnam.
5. Share Capital
Financial StatementsAnnual Report 2022
During the year ended 30 June 2022 the Company repurchased and cancelled 661,084 ordinary shares (2021: 605,681
ordinary shares) under the Company’s share buyback programme (representing 1.6% of the ordinary shares outstanding at
1 July 2021) at a weighted average NAV discount of 21.3%. This resulted in a 0.25% accretion to NAV per share.
The Company repurchased and cancelled a further 12,737,184 shares during the year ended 30 June 2022 following a tender
oer for 30% of the Company’s ordinary shares at a 2% discount to the prevailing NAV per share as at 31 August 2021 (2021:
7,585,249 ordinary shares).
Total ordinary shares repurchased and cancelled during the year were 13,398,268 (2021: 8,190,930).
Holders of ordinary shares are entitled to attend, speak and vote at general meetings of the Company. Each ordinary share
(excluding shares in treasury) earns one vote. Treasury shares do not carry voting rights.
Capital Management
The Company does not have any externally imposed capital requirements.
The Company’s general intention is to reinvest the capital received on the sale of investments. However, the Board may
from time to time and at its discretion, either use the proceeds of sales of investments to meet the Company’s expenses or
distribute them to Shareholders. Alternatively, the Company may repurchase its own ordinary shares with such proceeds
from Shareholders pro rata to their shareholding upon giving notice of not less than 30 calendar days to Shareholders
(subject always to applicable law) or repurchase ordinary shares at a price not exceeding the last published NAV per share.
Total equity of USD 128,822,167 (2021: USD 196,080,470) represents net assets attributable to Shareholders. NAV per share
as at 30 June 2022 is USD 4.408 (2021: USD 4.600).
Investment management fees
The Company entered into a new investment management agreement with Dynam Capital, Ltd on 26 June 2018. The
agreement was amended and restated on 8 October 2018 and further amended and restated on 1 October 2020. The Board
and the Investment Manager agreed to modify the management fee (previously on a sliding scale of 1.5% per annum on
NAV below USD 300 million, 1.25% per annum on NAV between USD 300 – USD 600 million, and 1.0% per annum on NAV
above USD 600 million) eectively from 1 November 2020.
5. Share Capital (continued)
6. Net Assets Attributable to Shareholders
7. Net (Loss)/Gain from Investments at Fair Value through Prot or Loss
8. Related Party Transactions
Notes to the Financial Statements
(continued)
Realised (loss)/gain on disposal of investments
Realised foreign currency gain/(loss)
Unrealised (loss)/gain on investments at fair value through prot or loss
Unrealised foreign currency (loss)/gain
2022
USD
2021
USD
15,275,568
(326,765)
84,667,613
1,113,703
100,730,119
50,172,287
253,204
(54,419,413)
(1,217,18 3)
(5,211,105)
65
Financial StatementsAnnual Report 2022
66
Pursuant to the agreement the Investment Manager is entitled to receive a monthly management fee, paid in the manner
set out as below:
The management fee accruing to the Investment Manager for the year ended 30 June 2022 was USD 2,737,804 (2021: USD
2,438,087). An amount of USD 200,421 (30 June 2021: USD 273,919) was outstanding as at 30 June 2022.
Directors’ fees and expenses
The Board determines the fees payable to each Director, subject to a maximum aggregate amount of USD 350,000 (2021:
USD 350,000) per annum being paid to the Board as a whole. The Company also pays reasonable expenses incurred by the
Directors in the conduct of the Company’s business including travel and other expenses. The Company pays for directors
and ocers liability insurance coverage.
The charges for the year for the Directors’ fees were USD 317,859 (2021: USD 313,443) and expenses were USD 67,433 (2021:
USD 15,247). The total Directors’ fees and expenses for the year were USD 385,292 (2021: USD 328,690).
As at 30 June 2022, USD 9,012 (2021: 8,250) of Directors’ fees were outstanding.
Directors’ ownership of shares
As at 30 June 2022, Directors held 44,920 ordinary shares in the Company (2021: 48,861) as listed below.
Mr. Funaki is also a Director of Discover Investment Company which holds 1,405,776 ordinary shares in the Company
representing 4.81% of the issued share capital. Discover Investment Company disposed of 916,905 shares during the year.
Mr Craig Martin, Chairman of the Investment Manager holds 59,686 shares in the Company. During the year he participated
in the tender oer tendering 26,887 shares and repurchased a further 5,000 shares during the year.
Custodian fees are charged at a minimum of USD 12,000 (2021: USD 12,000) per annum and received as a fee at 0.08% on
the assets under administration (“AUA”) per annum. Custodian fees comprise safekeeping fees, transaction fees, money
transfer fees and other fees. Safekeeping of unlisted securities up to 20 securities is charged at USD 12,000 (2021: USD
12,000) per annum. Transaction fees, money transfers fees and other fees are charged on a transaction basis.
The charges for the year for the Custodian fees were USD 152,863 (2021: USD 146,875), of which USD 13,000 (2021: USD
16,000) were outstanding at year end.
On the amount of the Net Asset Value of the Company up to but excluding USD 300 million, one-twelfth of 1.75%;
On the amount of the Net Asset Value of the Company between and including USD 300 million up to and including USD
600 million, one-twelfth of 1.5%; and
On the amount of the Net Asset Value of the Company that exceeds USD 600 million, one-twelfth of 1%.
9. Custodian Fees
Hiroshi Funaki
Sean Hurst
Philip Scales
Damien Pierron
Saiko Tajima
19,887
5,312
10,077
4,644
5,000
(disposed of 6,756 shares during the year and purchased a further 6,000 shares during the year)
(disposed of 5,206 shares and purchased a further 3,300 shares during the year)
(disposed 3,273 shares and purchased a further 3,350 shares during the year)
(disposed 3,606 shares and purchased 3,350 shares during the year)
Shares
Shares
Shares
Shares
Shares
Financial StatementsAnnual Report 2022
In accordance with the new Administration Agreement between the Company and Sanne Group (Guernsey) Limited (the
“Administrator”) dated 7 October 2019, the Administrator is entitled to receive a fee of 0.08% per annum of NAV up to USD
100,000,000, 0.07% of NAV thereafter subject to a minimum fee of USD 140,000 per annum. The administration fees are
accrued monthly and are payable quarterly in advance. The charges for the year for Administration fees were USD 139,207
(2021: USD 138,460), of which USD 1,130 (2021: USD 2,693) were outstanding at year end.
The Sub-Administrator receives a fee as consideration for the services provided to the Company at such rates as may
be agreed in writing from time to time between the Company and the Sub-Administrator. The charges for the year for
Administration fees were USD 77,731 (2021: USD 80,810), of which USD 5,303 (2021: USD 8,070) were outstanding at year
end.
Total administrative and accounting fees for the year were USD 216,938 (2021: USD 219,271).
For certain of the Company’s nancial instruments not carried at fair value, such as cash and cash equivalents, accrued
dividends, other receivables, receivables/payable upon sales/purchase of investments and accrued expenses, the amounts
approximate fair value due to the immediate or short-term nature of these nancial instruments.
Other nancial instruments are measured at fair value through prot or loss.
Fair value estimates are made at a specic point in time, based on market conditions and information about the nancial
instrument. These estimates are subjective in nature and involve uncertainties and matters of signicant judgement and
therefore, cannot be determined with precision. Changes in assumptions could signicantly aect the estimates.
The Directors are not aware of any ultimate controlling party as at 30 June 2022 or 30 June 2021.
10. Administrative and Accounting Fees
11. Controlling Party
12. Fair Value Information
Notes to the Financial Statements
(continued)
Level 1: Inputs that are quoted market prices (unadjusted) in active markets for identical instruments. This level
includes listed equity securities on exchanges (for example, Ho Chi Minh Stock Exchange).
Level 2: Inputs other than quoted prices included within Level 1 that are observable either directly (i.e., as prices)
or indirectly (i.e., derived from prices). This level includes instruments valued using: quoted prices for identical or
similar instruments in markets that are considered less than active; quoted market prices in active markets for similar
instruments; or other valuation techniques in which all signicant inputs are directly or indirectly observable from
market data.
Level 3: Inputs that are not based on observable market data (i.e., unobservable inputs). This level includes all
instruments for which the valuation technique includes inputs not based on observable data and the unobservable
inputs have a signicant eect on the instrument’s valuation.
67
Financial StatementsAnnual Report 2022
The table below analyses nancial instruments measured at fair value at the reporting date by the level in the fair value
hierarchy into which the fair value measurement is categorised. The amounts are based on the values recognised in the
Statement of Financial Position. All fair value measurements below are recurring.
68
There were no transfers between levels during the year.
The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety is determined
based on the lowest level input that is signicant to the fair value measurement in its entirety. Assessing whether an input
is signicant requires judgement including consideration of factors specic to the asset or liability. Moreover, if a fair value
measurement uses observable inputs that require signicant adjustment based on unobservable inputs, that fair value
measurement is a Level 3 measurement.
There are no level 3 assets held at 30 June 2022 (2021: Nil).
The table below provides a breakdown of the line items in the Company’s Statement of Financial Position to the categories
of nancial instruments.
13. Classications of Financial Assets and Liabilities
Level 1
USD
Level 2
USD
Level 3
USD
Total
USD
2022
Financial assets classied at fair value upon initial recognition
Investments in securities
2021
Financial assets classied at fair value upon initial recognition
Investments in securities
120,957,996
193,108,385
—
—
—
—
120,957,996
193,108,385
Cash and cash equivalents
Investment in securities at fair value
Accrued dividends
Accrued expenses
Cash and cash equivalents
Investment in securities at fair value
Accrued dividends
Receivables on sale of investments
Payables in purchase of investments
Accrued expenses
2022
2021
Fair value through
Prot or loss
USD
Loans and
receivables
USD
Total carrying
amount
USD
Other
liabilities
USD
8,160,681
120,957,996
58,772
12 9,177,4 49
355,282
355,282
—
—
—
—
355,282
355,282
8,160,681
—
58,772
8,219,453
—
—
—
120,957,996
—
120,957,996
—
—
—
193,108,385
—
—
193,108,385
—
—
—
—
—
—
—
3,905,824
431,912
4,337,736
6,031,337
193,108,385
30,153
1,239,041
200,408,916
3,905,824
431,912
4,337,736
6,031,337
—
30,153
1,239,041
7,30 0,531
—
—
—
Financial StatementsAnnual Report 2022
The calculation of basic and diluted earnings per share at 30 June 2022 was based on the total comprehensive loss for the
year attributable to Shareholders of USD 7,719,310 (2021: Income of USD 100,153,888) and the weighted average number of
shares outstanding of 31,987,327 (2021: 45,761,268).
From 1 July 2022 to the date of signing these nancial statements, there were no material events that require disclosures
and/ or adjustments in these nancial statements.
(i) Standards and amendments to existing standards eective 1 July 2021
The Board of Directors has assessed the impact, or potential impact, of all new standards and amendments to existing
standards. In the opinion of the Board of Directors, there are no mandatory new standards and amendments applicable
in the current year that had any material eect on the reported performance, nancial position, or disclosures of the
Company.
(ii) Standards eective after 30 June 2022 that have been early adopted by the Company
There are no standards eective after 30 June 2022 that are relevant to the Company.
14. Earnings Per Share
15. New and Amended Standards and Interpretations
16. Events After the Reporting Date
Notes to the Financial Statements
(continued)
69
Financial StatementsAnnual Report 2022
Discount or Premium
The amount, expressed as a percentage, by which the ordinary share price is either higher (premium) or lower (discount)
than the NAV per ordinary share.
Ongoing charges
Ongoing charges have been calculated in accordance with the Association of Investment Companies (the “AIC”)
recommended methodology by taking the regularly incurred annual operating expenses of running the Company expressed
as a percentage of average NAV.
The ongoing charges for the year ended 30 June 2022 were 2.74%.
a) Average NAV
Calculated using twelve monthly closing average NAV for the year ended 30 June 2022.
b) Operating expenses
Total annual expenses incurred by the Company less the cost of project and one-o expenses i.e. non-recurring expenses.
Alternative Performance Measures (“APMs”)
NAV per ordinary share (pence)
Ordinary share price (pence)
Discount
Average NAV
Operating expenses
Ongoing charges
Total annual expenses
Less: non-recurring expenses
Operating expenses
30 June 2022
30 June 2022
USD
USD
Page
Page
Page
a
b
((b-a)/a)
a
b
b/a
c
d
b=c+d
1
1
1
1
1
1
53
363.0
309.5
14.7%
155,041,007
4,242,306
2.74%
4,252,094
(9,788)
4,242,306
70
Financial StatementsAnnual Report 2022
Directors
Mr. Hiroshi Funaki
Mr. Sean Hurst
Mr. Philip Scales
Mr. Damien Pierron
Ms. Saiko Tajima
Investment Manager
Dynam Capital, Ltd
De Catapan House
Grange Road
St Peter Port
Guernsey
GY1 2QG
Registered Office, Company
Secretary and Administrator
Sanne Group (Guernsey) Limited
De Catapan House
Grange Road
St Peter Port
Guernsey
GY1 2QG
Sub-Administrator, Custodian
and Principal Bankers
Standard Chartered Bank (Singapore) Limited
7 Changi Business Park Crescent
Level 3, Securities Services
Singapore 486028
UK Legal Adviser
Stephenson Harwood LLP
1 Finsbury Circus
London
EC2M 7SH
Guernsey Legal Adviser
Carey Olsen (Guernsey) LLP
Carey House
Les Banques
St Peter Port
Guernsey
GY1 4BZ
Auditor
KPMG Channel Islands Limited
Glategny Court
Glategny Esplanade
St Peter Port
Guernsey
GY1 1WR
Market Researcher
Dynam Consultancy and Services
Company Limited
Floor 12, Deutsches Haus,
33 Le Duan,
Ben Nghe Ward, District 1
Ho Chi Minh City,
Vietnam
Corporate Broker and Financial Adviser
finnCap Ltd.
One Bartholomew Close
London
EC1A 7BL
(Nominated Adviser (AIM) until
transference to LSE Main Market)
Registrar
Computershare Investor Services (Guernsey)
Limited
1st Floor, Tudor House
Le Bordage
St Peter Port
Guernsey
GY1 1DB
Corporate Information
71
