Securities companies bullish on Vietnamese stock market

The VN-Index could reach 1,460 points in 2024. Support policies from domestic investments will help Việt Nam’s economy achieve the government's goals. GDP is expected to regain a stable growth rate of around 6.5 per cent. VNA/VNS Photo

HÀ NỘI Securities companies still feel optimistic about 2024 and believe that the VN-Index will return close to its historical peak.

National Securities Inc (NSI) expects the domestic economy to continue recovering, with the VN-Index aiming for the 1,400-point range in 2024. VNDirect Securities also expresses an optimistic outlook for the market in 2024, with expectations that the VN-Index could reach the 1,400-1,450-point range.

In the report of Phú Hưng Securities Company (PHS), it is forecast that the VN-Index could reach 1,460 points in 2024. PHS believes that the support policies from domestic investments will help Việt Nam’s economy achieve the Government's goals. GDP is expected to regain a stable growth rate of around 6.5 per cent.

With lower expectations, TPS Securities forecasts that the VN-Index will fluctuate around the target of 1,387 points, corresponding to a cautious 10 per cent growth for the whole year and a target P/E ratio of 15.x (equivalent to the average P/E ratio of the past 10 years).

TPS reasoned that macro difficulties will gradually subside, creating a basis for central banks worldwide to loosen monetary policies, stimulating consumer activity and supporting Việt Nam’s export operations.

Sharing an optimistic perspective, MB Securities (MBS) expects the profits of listed companies to grow by 16.8 per cent in 2024, amid positive macro improvements. MBS also predicts that Việt Nam’s exports in 2024 will grow by 6-7 per cent compared to the low of 2023, thanks to significant cooling pressures in the supply chain and a rising trend in demand for phones and electronic components. Disbursement of public investment is estimated to achieve a rate of 85-90 per cent of the plan, thanks to the efforts to promote management. Monetary policies in 2024 will be more balanced and actively support growth.

The input interest rate is expected to reach a bottom in the first quarter of 2024 and increase slightly from the middle of the year but still maintain a low level.

Lã Giang Trung, CEO of Passion Investment, added that with positive factors such as the world's impending monetary easing and Việt Nam’s historically low interest rates, the stock market in 2024 has great potential for an explosive boom. He believes that the VN-Index in 2024 has the opportunity to return to around 1,500 points, with a growth of over 30 per cent. This will set the stage for the market to surpass its previous peak in the first quarter of 2025.

However, the growth of the stock market in 2024 will be different from 2023. While small and mid-cap stocks led the market's growth last year, 2024 will be the year of large-cap stocks with low valuations. Although large-cap stocks will drive a strong breakthrough in the VN-Index in 2024, there will be very few stocks that outperform the VN-Index.

In 2023, the stock market maintained stable growth momentum with the market capitalisation of the HoSE, HNX, and UPCoM exchanges reaching VNĐ5.937 quadrillion, a 13.6 per cent increase compared to the end of 2022, equivalent to 58.1 per cent of the GDP in 2023. The VN-Index on December 29, 2023, stood at 1,129.93 points, a 12 per cent increase compared to the end of 2022, with stock market liquidity reaching VNĐ17.5 trillion per session.

Also in 2023, the management of public companies, securities companies, fund management companies, and securities investment funds continued to be strengthened. In addition, the State Securities Commission and relevant agencies enhanced market supervision, rigorously addressing legal violations and securities price manipulation, maintaining market discipline, stability, and investor confidence, which helped increase market liquidity and sustain sustainable development.

Regarding the outlook for 2024, Vũ Thị Chân Phương, Chairwoman of the State Securities Commission, stated that the market's future developments would largely depend on macroeconomic policies and the domestic and global economic prospects.

The Vietnamese economy in general, and the stock market in particular, are expected to continue facing many difficulties and challenges amid climate change, increasing political tensions, global economic uncertainties and complex and unpredictable movements in the international financial markets.

The Chairwoman of the State Securities Commission stated that the stock market in 2024 would be supported by positive factors.

Phương said: "The government and the Prime Minister have directed ministries and localities to implement various solutions to overcome difficulties, stabilise and promote economic growth, such as reducing lending interest rates, stabilising the foreign exchange market, promoting disbursement of public investment capital, and implementing credit packages to support industries."

Furthermore, positive trends will continue in many sectors and areas, and the economic prospects of Việt Nam are still highly regarded by international organizations. The new KRX information technology system, when put into operation, will provide the foundation for the implementation of many new trading solutions.