According to Bao Viet Securities Company (BVSC), with high return on equity, stocks in the VN-Index are being traded at a very attractive price range when comparing correlatively. with other regional and international stock markets.
Many macro factors will support the market’s growth trend in the whole year 2021. Photo: Duy Dung. The probability of VN-Index falling is not high According to BVSC’s report, compared with the movements of the VN-Index in the past, the current P / E of the VN-Index is already higher than the 5-year average. However, according to BVSC’s observation, at the current P / E, the probability of a market decline is not high. In addition, with the recovery of the economy, according to BVSC’s forecasts, profits of listed businesses will grow by 27.3% by 2021 (compared to 2020). With the profit growth of listed companies, the P / E of the VN-Index is likely to drop to 15 times – lower than the 5-year moving average (16.41 times) of the VN- Index; therefore, the 2021 P / E level of the market is still attractive. BVSC’s experts believe that the Vietnamese market is attractive compared to other markets in the region, but it is very important to the ability to attract foreign capital, connect with the flow of investment capital in the world. equals the valuation of Vietnamese stocks in terms of general ground. Up to now, the market liquidity and the ETFs participating in the market have also contributed to help the Vietnamese market’s valuation ground closer to other markets in the world. As of April 9, 2021, compared to the sample of 12 markets observed by BVSC, including countries in frontier, emerging and developed markets, the P / E of the VN-Index is currently at 19.11 times. – 4th low out of 13 markets followed and just above P / E of Shanghai Index (17.61 times) of China, Hang Seng (14.86 times) of Hong Kong and KOSPI (12.99 times) of Korea. These are also 3 markets with a sharp decrease of more than 10%, in February and March. Meanwhile, “the rate of return on equity of the companies listed on the HSX stock exchange is at the highest level among the markets we monitor. This shows that, in general, with high return on equity, stocks in the VN-Index basket are being traded at very attractive price ranges when compared with other markets. other securities in the region and internationally ”- said BVSC’s expert. The market still maintained an uptrend throughout the year According to experts from BVSC, despite facing an interest rate hike in 2022, the stock market can normally recover and then rebound after early monetary tightening. first. The reason for this is that central banks in many countries often practice monetary tightening since the economy is still in the growth phase, when businesses still have positive business results and do. reduce the impact of increasing operating rates. Therefore, BVSC believes that the world stock market is not too concerned when central banks of countries implement interest rate hikes or monetary tightening for the first time. In the past, markets often reversed and fell into a downward phase at the third rate hike by central banks. For Vietnam, according to BVSC’s experts, with the context that GDP growth is accelerating again and can grow impressively in the second quarter; Other macro indicators are operating stably, supporting business activities; listed companies will have good growth in 2021, especially many industries with high growth in the first quarter such as banking, steel …; and beyond, foreign capital will continue to flow into Vietnam market thanks to its ability to be upgraded and the attractiveness of a dynamic and rapidly growing economy. “These are factors supporting the market’s growth trend in 2021” – stressed BVSC expert. However, BVSC also notes some potential short-term risks. Accordingly, when the positive information has been reflected in the price, the new cash flows into the market cannot keep up with the price increase, the cash flow is withdrawn from major shareholders – or companies that sell stocks. Fund … Besides, when the opportunities to gain from pure stocks derive from cash flow factors, lack of support in the core positive change of the business, will create potential risks. on the ability of the market to correct in the short term./.
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