Finland’s PYN Elite Fund, which has extensive investments in the Ho Chi Minh City Stock Exchange–or the Hose–has named Vietnam Airlines, which trades under the ticker HVN, as its stock pick of the month for June. The fund doesn’t really give any clear reasons for making this call but does note in its that:
“The State still owns over 86 percent of HVN and recently allowed HVN to extend a state-backed loan repayment of $160m for three more years at favourable conditions.”
That US$160 million loan, however, was to avoid insolvency with the airline currently operating on negative equity. It also should have been delisted from the HoSE years ago, however, the government intervened to stop that from becoming a reality. In light of this, naming Vietnam Airlines as the stock of the month is an interesting decision to say the least.
Not to mention that, broadly speaking, Vietnam’s airline industry is not particularly healthy with a number of challenges facing Vietnam’s major airlines (see: Vietnam’s Airline Industry Turbulence: Unpacked).
It’s also worth noting that PYN Elite said earlier this year that it believed the HoSE could hit 1,700 points by the end of the year, which would be an increase of 34 percent–in the first six months of this year the VN-Index climbed just 10.27 percent. In light of this, 1,700 points seems very optimistic.
See also: How to Open a Trading Account in Vietnam: Technical Guide 2024