“Long-Term Outlook for Investment in Vietnam Continues to Be Attractive”

The long-term outlook for investment in Vietnam continues to be attractive. The Vietnamese economy has grown at an average compound growth rate (CAGR) of 16.2 per cent in Vietnam Dong and 11.9 per cent in USD between 2000 and 2010, one of the fastest growth rates in the Asian region. This high economic growth in Vietnam is driven mainly by: high levels of Foreign Direct Investment (FDI), strong domestic consumption growth from a low base and a high percentage of the population in the workforce, with rates of female participation in almost at the same level as male participation in the work force. Besides, favorable demographics, high rates of home ownership combined with low consumer debt levels and pro-reform government that has steadily opened Vietnam to global integration, and improved the functioning of Vietnam’s capital markets also contribute to this growth.

 

We are pioneers in applying Vision Driven Investing, which has resulted in significant breakthroughs in net profit performance in our investee companies from 2009 onwards. For 2011, most among our investments are also doing extremely well, especially the retail and consumer companies. We work with our investee companies to set really clear targets that they and we can own. We play an executive coaching role, and work with them to make sure they stay on track. Some of them will stray, but then we meet to them to get back on track.

 

For every company we invest in, the more focused a company is, the more successful they are. It’s so consistent. I’d say it was kind of counter-intuitive, but it turns out that by doing one thing really well, you can grow a lot faster than by doing a lot of things in a mediocre way. I believe it’s the same in terms of fund performance. We are becoming more focused ourselves. In the present market, we are going to be very strictly focused on consumer-driven industries as we have developed a lot of expertise in areas like branding/marketing, distribution networks, sales management, and building retail networks. And with management teams, we’re looking for a very strict focus. Our strategy is about seeking out really strong management teams and companies that are really committed to continuously developing their management teams.

 

The Gioi Di Dong: This company has a very strong and robust management team and a powerful corporate culture, which enable it to open around 10 stores per month – which is faster than any retailer in the history of Vietnam. The Company controls 30 per cent of the domestic mobile phone retail market and operates a nationwide chain of 168 thegioididong stores & 3 dienmay.com stores as of October 2011.

 

Golden Gate: Golden Gate has also built its management team into the most well managed restaurant operator in Vietnam – and we believe the most profitable. Their recently launched restaurant concept, SumoBBQ, has been a huge success. The Company is currently having 5 high-end Ashima restaurants, 22 Kichi-Kichi hotpot outlets and 5 Sumo BBQ (Japanese BBQ/hotpot restaurants) in operation. Golden Gate also has an aggressive expansion plan which is expected to result in at least 100 company-owned restaurant locations by the end of 2013.

 

PNJ: Across the nation, PNJ has 19 branches, 150 retail stores and more than 3,000 wholesalers, which are well-located to reach targeted consumers. This network continues to expand. Their retail brands cover the full spectrum of market segments and include CAO Fine Jewelry, PNJ Gold, PNJ Silver, Jemma and Ya-bling.