Vietnam bond market report - May 2025
02-06-2025
: VDS
: Macroeconomics
: Toan Vo
Tags: Bond
- Primary government bond issuance dropped sharply in May, with new issuance totaling only VND 18,049 billion (–57.5% MoM); the auction success rate fell to its lowest level YTD (46.5%). Winning yields and secondary market yields continued to edge up, reflecting ongoing upward pressure from global yield trends and investor caution.
- Government bond market liquidity remained solid, with average daily trading value at VND 14,463 billion (+14.4%), primarily from outright transactions. Foreign investors maintained net buying activity, helping stabilize liquidity and support market sentiment.
- The real estate sector accelerated bond buybacks in May. New corporate bond issuance decreased (VND 34,500 billion, –21.6% MoM), but early redemption activity picked up, particularly among real estate and banking groups. Cumulatively over the first five months, corporate bond issuance reached more than VND 80,500 billion (+26.2% YoY); early buybacks totaled nearly VND 54,900 billion (+6.8%).
- Corporate bond maturity pressure will rise in the coming quarter. In Q3/2025, the real estate group is expected to face significant maturity pressure with VND 42,000 billion due (57% of total maturities). The value of overdue corporate bonds rose to VND 53,600 billion, with real estate accounting for nearly 60%.
- Liquidity in the secondary corporate bond market improved but remained polarized. Total trading value in May reached VND 9,890 billion (+10.1%), mainly in the 1–3 year tenor segment among financial institutions. Real estate bonds were traded mostly at longer tenors (over 3 years), highlighting a clear divergence in risk appetite across sectors.
HDB - Outstanding growth driven by expanding credit scale and non-interest income
30-05-2025
: HDB
: Banking
: Trang To
Tags: HDB
- Positive 1Q25 business results were mainly driven by a sharp expansion in non-interest income (+204% YoY), especially from fee income, bond trading activities, and other activities. Net interest income grew 3% YoY with credit growth of 3.8% YTD, led by corporate lending at 9.9% YTD, while NIM narrowed by 80 bps QoQ to 4.8%. However, asset quality deteriorated, with a strong rise in net NPLs formation pushing the consolidated NPL ratio (customer loans) to 2.4% (4Q24: 1.9%).
- For 2025, PBT is projected to grow 22% YoY, based on (1) credit growth outlook of 31% and a ~50 bps decline in NIM to 4.8%, and (2) robust non-interest income growth (+51% YoY), primarily contributed by bancassurance, corporate advisory, and recoveries of written-off bad debts.
- The current target price is VND 27,400/share, implying an expected return of 29% (including VND 1,000 in cash dividend), with a BUY recommendation for HDB.
GEG – Revenue rose sharply thanks to the retroactive payment of Tan Phu Dong 1
29-05-2025
: GEG
: Power
: Nguyen Duc Chinh
Tags:
- In Q1/2025, GEG recorded revenue of VND 1.1 trillion (+51% YoY) and NPAT-MI of VND 378 billion (+322% YoY). The main growth driver came from the retroactive payment amount of VND 397 billion from Tan Phu Dong 1 wind power plant after the completion of the PPA, despite a 25% YoY decline in wind power output due to low wind speeds. Solar power output decreased by 9% YoY due to cool weather, leading to a 6% YoY decrease in revenue, to VND 210 billion. In contrast, hydropower benefited from favorable hydrological conditions, output increased by 19% YoY and revenue reached VND 61 billion (+7% YoY), despite a decrease in market prices.
- GEG's interest expense decreased by 24% YoY due to a 9% YoY decrease in the company's total outstanding loans. GEG's NPAT increased by 315% YoY, to VND 375 billion. During the quarter, GEG completed 33% of its revenue plan and 89% of the annual profit plan thanks to unexpected revenue spikes.
MWG – Q1-2025 results exceeded expectations driven by a recovery in ICTCE retailing market share
28-05-2025
: MWG
: Retailing
: Hung Nguyen
Tags:
- MWG’s Q1-2025 results surpassed our expectations, delivering net revenue of VND 36,135 bn (+14.8% YoY) and it of VND 1,546 bn (+71.3% YoY), propelled by a significant recovery in ICTCE retail market share through a leaner store network with lower operating and depreciation costs. Two key strategies underpinned this success: (1) Strengthening partnerships with high-potential brands (familyship), and (2) Revamping customer acquisition strategies, adhering to twin principles of “saving customer wallets” through 0% installment plans, enhanced discounts, and price reductions, alongside “upgraded premium after-sales services.”
- The profit potential for MWG stock in the near term hinges on the spearhead of “BHX Central penetration,” as the current market price fully reflects the restored ICTCE retail market share and the company’s efficient financial investment performance.
- Bolstered by the robust recovery in electronics retail market share, we raise MWG’s valuation to VND 68,700 per share (including a VND 1,000 cash dividend per share), derived from a 50:50 blend of long-term DCF and short-term SoTP methodologies.
- We advise investors to closely monitor BHX’s key performance indicators in upcoming quarters, particularly improvements in sales per store (from VND 1.8 bn to above VND 2.0 bn) or net margin (from 0.2% to 0.5-1.0%). Strong/underwhelming BHX results could amplify or dampen short-term profit expectations for MWG’s stock, thereby increasing/decreasing the short-term SoTP method’s contribution (50%) to MWG’s overall valuation, potentially unlocking greater/lesser profit upside.
NLG – Business performance strengthened by handovering of Akari 2 and Can Tho projects
27-05-2025
: NLG
: Real Estate
: Giao Nguyen
Tags: NLG
- In Q1/2025, NLG's revenue and gross profit increased sharply over the same period, reaching VND 1,291 billion (+531% YoY) and VND 413 billion (+377% YoY), respectively, thanks to the promotion of handovers at Akari 2 and Nam Long Can Tho projects. Gross profit margin recorded 32%, due to NLG's handover of high-rise products and low-value products (Akari 2 and EhomeS Can Tho)
- Presales in the first quarter decreased compared to the same period and the previous quarter and reached VND 545 billion (-68% QoQ, -53% YoY). However, presales in April alone reached VND 2,031 billion, showing positive signs of recovery in Southgate (Long An) as well as satellite areas.
- We estimate that NLG's revenue and net profit after tax and minority interest (NPAT-MI) in 2025 to reach VND 6,661 billion (-7% YoY) and VND 794 billion (+53% YoY), respectively, mainly from handovers at Southgate, Can Tho and Akari 2 projects.
MONETARY MARKET UPDATE MAY 2025: ANCHORING AGAINST THE TIDE
26-05-2025
: VDS
: Macroeconomics
: My Tran
Tags: VDS
- The State Bank of Vietnam (SBV) conducted net withdrawals on the open market in May 2025, with the volume of collateralized lending via open market operations (OMO) falling sharply compared to the previous month.
- Interbank interest rates and deposit rates remained stable throughout the month.
- Commercial banks continued to promote mortgage lending, especially targeting young homebuyers through preferential interest rate packages, while the Government urged banks to participate in large-scale credit programs to accelerate national strategies on infrastructure development and digital transformation.
- Despite external pressures, credit growth maintained strong momentum in April 2025, with the credit outstanding as of April 28th already surpassing full-year growth expectations.
- Three notable and significant changes in the global monetary landscape: 1. Rising concerns about debt and fiscal deficits, especially following Moody’s recent downgrade of the US sovereign credit rating; 2. The possibility of foreign exchange market interventions being included in trade negotiations with the US; 3. A visible trend of foreign reserves diversification, reducing overreliance on the US dollar.
- We believe these developments will shape a medium- and long-term outlook of weakening US dollar strength. Overall, this trend is expected to be favorable for maintaining VND stability.
- A favorable outcome of the negotiations will help to contain the depreciation of the VND. Currently, we still maintain the view that the VND may depreciate by 3-5% in 2025.
ACV – Revenue and profit maintain growth momentum thanks to international tourism demand
23-05-2025
: ACV
: Aviation
: Quan Cao
Tags:
- In Q1-FY25, NPAT reached VND 2,716 billion (+5% YoY), in line with our forecast (estimated NPAT for Q1-FY25 was VND 2,560 billion), representing 26% of our full-year projection.
- We maintain a positive outlook on ACV’s growth potential in 2025. For 2025, projected passenger volumes are 46 million for international (+9% YoY) and 76 million for domestic (+6% YoY). Revenue and NPAT are expected to reach VND 24,626 billion (+9% YoY) and VND 10,472 billion (+3% YoY), respectively.
- Despite a recent resurgence of COVID-19 in parts of Southeast Asia and China, most cases are mild and the situation remains under control. Nevertheless, this poses a potential risk to international passenger volumes and must be closely monitored.
- The market price largely reflects its current growth outlook. We maintain an ACCUMULATE recommendation with a target price of VND 113,200 per share, implying an expected return of 15%.
The Fed’s independent monetary policy amid political challenges and global volatility
22-05-2025
: VDS
: Macroeconomics
: Toan Vo
Tags: FED Trump interest rate US
- The Fed maintains its stance despite pressure from the White House.
- Safeguarding the Fed’s monetary policy independence under the Trump administration.
Q1/2025 business results of the fertilizer industry and perspective on short-term fertilizer prices
21-05-2025
: DCM, DPM, DDV, BFC, LAS
: Fertilizer
: Hien Le
Tags:
- Revenue in Q1/2025 of the fertilizer industry recorded strong growth with most types of fertilizers. However, the growth was mainly from NPK, DAP and Phosphorus fertilizers while Urea fertilizers were stable. Notably, the DAP fertilizer industry recorded a breakthrough thanks to high growth in output and selling prices thanks to China's export restrictions since December 2024.
- Urea prices have also risen sharply recently as U.S. tariffs indirectly affect urea prices in other regions. However, the selling price of urea is hard to increase in the coming period when China is expected to export again. In addition, the price of Phosphate-based fertilizer is expected to be difficult to fall as China restricts exports of apatite ore products.
- The fertilizer industry in Q2-2025 is expected to grow strongly thanks to improved gross margins as selling prices grow. In addition, the urea fertilizer industry benefited from a sharp decline in input gas prices YoY in line with Brent oil prices when Brent oil prices had a high base last year.
Southeast Asia's Jack-Up rig market outlook: Remains positive for 2025 - 2026
20-05-2025
: PVD
: Oil & Gas
: Huong Le
Tags: Drilling rig
- In 2024, the utilization rate of jack-up rig in Southeast Asia remained high at around 90%, indicating market stability despite short-term fluctuations.
- We expect drilling demand to remain strong during 2025–2026, with utilization rates ranging between 80% and 90%. Vietnam is expected to lead the region in the coming period, driven by the implementation of several key oil and gas projects such as Block B, Su Tu Trang, Dai Hung, Lac Da Vang, and Hai Su Vang.
TRADE UPDATE APRIL 2025: TRADE TENSIONS EASE AND IMPLICATIONS FOR VIETNAM
19-05-2025
: VDS
: Macroeconomics
: My Tran
Tags: VDS
- Trade activity in April 2025 accelerated significantly, as export orders were boosted by the 90-day tariff suspension period.
- By industry, electronics and machinery recorded the highest growth in both exports and imports.
- Facing tariff pressures, exports to the US continued to post strong growth (+34.2% YoY in April 2025), nearly twice the rate of export growth to non-US markets.
- The de-escalation of the trade war, marked by the first agreement between the US and the UK and easing tensions between the US and China, brings several implications for Vietnam’s trade outlook:
- In the short term, Vietnamese exporters are likely to ramp up production as risks remain tilted towards the imposition of tariffs above 10% after the 90-day grace period expires. For Vietnam, this 90-day window ends on July 8, 2025, while for China, the deadline is August 12, 2025.
- The 10% tariff rate on UK imports after recent negotiations signals that this may also serve as the baseline rate that the US will maintain for other trading partners. Currently, the average import tariff in the US stands at 13.1%, down from 22.8% prior to the US–China agreement, but still significantly higher than the end-2024 level of 2.3%.
- The US–UK trade agreement suggests that reciprocal tariffs may be less significant than the details of concessions each side is willing to make in strategic sectors, and the extent to which non-tariff barriers are relaxed for US exporters.
- The China plus one strategy may or may not regain momentum for Vietnam. The outcome of US–China negotiations could open up opportunities for Vietnam to secure a 10% base tariff following bilateral talks. However, the risk of Vietnam facing higher reciprocal tariffs "relative to other countries" remains a key downside, especially given the complex nature of ongoing negotiations.
Q1 2025 Banking Sector Update: Strong Profit Growth Amid Divergent Credit Dynamics
16-05-2025
: BID, CTG, MBB, TCB, VPB, ACB, VIB, LPB, MSB
: Banking
: Tung Do
Tags:
- In 1Q25, 27 listed Vietnamese banks reported a consolidated PBT of nearly VND 83 trillion (approximately USD3.3 billion), marking a 14% YoY increase. The growth was driven by a 7% YoY rise in net interest income and a striking 151% YoY surge in income from other activities, while provisions for credit risks remained flat compared to the same period last year.
- Credit growth among listed banks reached 3.76% year-to-date through Q1 2025, slightly trailing the broader banking system’s 3.93%. This reflects a positive recovery in capital demand compared to the 1.42% growth recorded in Q1 2024, achieving roughly 25% of the State Bank of Vietnam’s (SBV) 16% credit growth target for the year. The structure of credit growth showed no significant shifts, with corporate lending and short-term loans continuing to drive system-wide expansion.
- Deposit mobilization by listed banks grew by 3.3% in Q1 2025, with customer deposits rising 2.4% and issuances of valuable papers surging 11.0%. However, deposit growth lagged behind credit growth by 0.4 percentage points, though the gap narrowed compared to 2024. The average tenor of mobilized capital is trending longer, fueled by banks issuing bonds to bolster Tier 2 capital and certificates of deposit to enhance competitiveness in attracting low-cost CASA deposits via hybrid earning account. With credit growth expected to accelerate later in 2025, pressure on deposit interest rates and funding costs is likely to intensify for banks in the remainder of the year.
- The industry’s NIM contracted by 30 basis points QoQ to 3.05%, driven by a 25 bps QoQ decline in asset yields and a 5 bps QoQ increase in funding costs. This reflects intensifying competition in lending rates, spurred by government-directed preferential credit packages aimed at lowering borrowing costs. Additional pressures include the structure of new loan tenors, rising non-performing loans, and the reversal of accrued interest, compounded by competitive dynamics in deposit mobilization.
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