HSBC advised to buy stock in Viet Nam due to VNINDEX will access 1100 by the end of 2008 18% compared to the end of 2007.

HSBC advised to buy stock in Viet Nam due to VNINDEX will access 1100 by the end of 2008 18% compared to the end of 2007.

Viet Nam economy develop at high rate 8%/year. Enterprises’ profit rise sharply recent years 80% in the first half of 2007. P/E at 20.

However, a risk for short time investment. HSBC: The bad is that Viet Nam is restrict the foreign currency, restrict the amount of money into the security market. Since Nov 2007, the state bank stoped buying USD. It has been difficult for investors to pour money into Vietnam and rise the “night interest” of “inter-banks” up to 10%. This situation may last until the TET holiday in Feb 2008.

The additional bad is from the auction vietcombank, the average price is 107,860VND/share. It means P/e=87, HSBC indicate it is so high because the 2007 profit ratio is just 14%.

The potential strategic investors will not satisfy with the price. Moreover, the price is so high that people are doubt about the success of the other auction of other major organizations in this year.

Along with VietNam market, the other markets such as China, Korea, India, Singapore and Thailand markets are said to be time to buy by HSBC. HSBC believe that Asia markets this year will give not bad profit to their investors.

However, Asia markets are suffering from inflation in 2008, and from the different ratio of China’s currency.

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enterpreted by vietnamfinance.blogspot.com