In January, the Kenno Vietnam Fund increased 9.7% in USD and 8.2% in EUR. The Fund's return in local currency is approximately 8.6%, outperforming the VN Index, which rose 2.5% in Vietnamese Dong. High‑quality stocks in Consumer Staples, Consumer Discretionary, and Information Technology performed very well late in the month, supported by the release of their 2025 earnings results. These stocks’ prices increased by 5-31% month-over-month. Vingroup-related stocks also saw a sharp correction of 10% to 17% month-over-month. During the month, we made several trades to rebalance our portfolio and position the Fund for the year ahead.
January played out in two very different halves. The VN Index rose 5.3% in the first two weeks, then pulled back 2.6% in the second half of the month. Early gains were driven mainly by state‑owned enterprises (SOEs) – particularly banks, insurers, oil & gas, and utilities – after the government issued Resolution 79, which reiterated the importance of strengthening major SOEs and accelerating their restructuring. The resolution outlines several key priorities: shifting SOE management from administrative control to modern corporate governance aligned with international standards; encouraging investment in high technology; promoting equitization; and allowing all proceeds from equitization and divestment to be reinvested or used to increase the share capital of major SOEs. While the announcement sparked expectations of stronger growth and a better long‑term outlook for these companies, in our view, the resolution does not immediately affect their earnings. However, it confirms the government's resolve to restructure the economy.
Vingroup‑related stocks also performed well in the first week, continuing the momentum they built in December 2025. Strong 2025 GDP growth of 8% released in the first week of January, along with the government’s 2026 GDP growth target of 10%, also supported the broader market. However, property stocks, including all Vingroup-related stocks, came under heavy pressure in the second week, weighed down by tighter monetary policy, higher mortgage rates at some banks (+2% compared to 3-4 months ago), and growing concerns about guidance that could limit credit to the sector.
The last two weeks of January marked the start of the earnings season, and market movements became more fundamentally driven. Investors’ interest shifted back toward high‑quality Consumer Staples, Consumer Discretionary, and Information Technology stocks, supported by strong 2025 earnings results release and an encouraging outlook for 2026. Meanwhile, Financials and Energy stocks lagged the market amid mixed earnings results.
The State Bank of Vietnam (SBV) has also shifted its stance heading into the 2026. In 2025, credit growth reached 19% year-over-year (YoY), pushing the credit‑to‑GDP ratio to 146%, up from 134% in 2024, while interest rates were kept at low levels in the first nine months of 2025 (9M/2025). This combination raised concerns about risks to the banking system liquidity, which was tight in late 2025, and potential pressure on the Vietnamese Dong (VND). Credit to the property sector also grew 22% YoY in 2025, accounting for roughly 24% of total credit. In early January 2026, the SBV outlined its monetary policy guidance for the year, setting an overall credit growth target of 15% and clarifying that credit growth for the property sector should not exceed 15%.
Although this puts some pressure on the portfolio's property stocks, including VRE and NLG, we believe it is the right move for both the economy and the stock market. It should help stabilize the banking system's liquidity and support the VND, which lost 3.2% of its value last year. A stable economy, with a stable local currency and sufficient credit for non‑property sectors, creates a healthier environment for businesses and investors alike. A stronger VND also benefits our fund’s USD returns.
Average daily trading value reached USD 1.5 billion in January, up 50% month‑over‑month (MoM). Liquidity was strong from the start of the month and stayed consistently high. This reflected not only active trading in stocks driven by policy developments and specific catalysts, but also a broader return of inflows as investor sentiment improved. January is typically an active period as listed companies release 2025 earnings and provide guidance for 2026, which usually draws more money into the market. Because the Lunar New Year falls three weeks later than usual this year, the usual liquidity slowdown ahead of the holiday is likely to occur in February rather than January.
Foreign investors returned to net selling after a month of buying, with total outflows reaching USD 263 million. However, we also saw selective buying from foreign investors in names such as FPT Corporation (FPT), Military Commercial Joint Stock Bank (MBB), and Techcombank Securities (TCX). This suggests a rotation our of last year’s winners, since foreigners continued to sell Vingroup‑related stocks, including Vingroup (VIC), Vinhomes (VHM), and Vincom Retail (VRE), as well as Vietjet Air (VJC).
The VND appreciated 1.0% in January 2026. Several factors supported this move. First, the US dollar weakened globally, with the dollar index falling from 98.3 to 96.6 in January, as U.S. policy signals pointed to expectations of slower growth and lower interest rates. Comments from President Trump favoring a weaker dollar to support exporters also added to this trend. Beyond the softer USD, the VND strengthened thanks to domestic factors: higher deposit interest rates increased demand for the VND, and the SBV adopted a more cautious monetary stance for 2026 by setting lower credit growth targets. In the first three weeks of January alone, the SBV withdrew USD 6 billion through open‑market operations.
The Kenno Vietnam Fund returned +9.7% (USD) and +8.2% (EUR) in January 2026.
As mentioned above, high‑quality stocks in Consumer Staples, Consumer Discretionary, and Information Technology performed well in late January, supported by the release of their 2025 earnings results. As we mentioned in our December 2025 commentary, we were confident in the portfolio’s 2025 profit, with estimated net earnings growth of 42% YoY. In fact, several companies delivered even better numbers than we had expected in our base-case scenarios – including MWG (net profit growth of +89% YoY in 2025), PNJ (+34% YoY), MSN (+106% YoY), MML (21 times YoY), FRT (+150% YoY) and FPT (+19.3% YoY).
In January, we joined several analyst calls and brokers’ webinars on the 2026 outlook. As a board member of TNH, Giang Nguyen also took part in approving the company’s 2026 budget, where the board pushed management to cut costs and get the business back on a growth trajectory.
We made several trades in January. We bought a meaningful number of NLG shares after the stock dropped 28% in the last three months due to tighter credit conditions in the property sector and higher mortgage rates. Even so, we continue to see a positive outlook for NLG, supported by strong 2025 presales (+128% YoY), especially in the fourth quarter (presales of VND 6.9 trillion in Q4/2025 compared with VND 5 trillion in 9M/2025), despite rising mortgage rates. It proves that NLG’s affordable products are well‑suited for end buyers and that demand for houses remains strong. We also added to our position in FRT when its share price declined in line with the broader market.
We sold some PNJ shares after the stock moved higher on strong fourth‑quarter results. In our view, PNJ’s share price is now more closely tied to gold price movements, so we trimmed the position to reduce exposure to that risk. We also sold some MML shares as the price rose, supported by both higher live hog prices ahead of the Lunar New Year and solid fourth‑quarter results. Liquidity jumped following the earnings announcement, and we used that opportunity to take some profit while keeping the position at 5% of total assets under management (AUM). Finally, we trimmed our MWG position to bring it back to the target weight.
Below we highlight investment cases that illustrate our portfolio management activities during the month.
FPT stock outperformed the market in January, supported by a wave of positive news in Vietnam’s technology sector and the company’s strong 2025 earnings results released late in the month. In December 2024, the Politburo issued Resolution No. 57 on breakthroughs in science, technology, innovation, and national digital transformation. The goal is to unlock Vietnam’s technological potential as an engine of economic growth. In January 2026, several large-scale projects broke ground as part of the implementation of Resolution 57, marking the effort to bring these ambitions to life and support the growth of Vietnam’s technology sector. These include a 200‑hectare digital technology and mixed‑use park in Hanoi developed by FPT, a semiconductor testing and packaging plant owned by FPT, and Vietnam’s first semiconductor fabrication factory built by Viettel, a military enterprise. These projects have helped lift market sentiment toward information technology stocks, as investors expect more jobs, stronger demand for information technology services, and a healthier business outlook. For FPT in particular, these projects are long‑term initiatives aimed at attracting and retaining technology talent, supporting the company’s continued growth trajectory.
FPT delivered solid results in 2025, reporting revenue growth of 11.6% and net earnings growth of 19.3%. Despite this, its share price fell 26.4% during the year, as investors grew concerned about the potential impact of the Trump administration’s tariffs on global corporate IT spending. These concerns were understandable: FPT’s software outsourcing revenue and backlog slowed in the second and third quarters, particularly in the Asia‑Pacific region. However, the business rebounded strongly in the fourth quarter as companies gained more clarity on the tariff situation. The software outsourcing backlog reached USD 1.5 billion in 2025, up 23.2% YoY, providing a positive outlook for 2026. Reflecting this improvement, FPT resumed hiring engineers in the fourth quarter after reducing headcount earlier in the year.
We expect FPT to achieve revenue growth of 12.6% YoY and net profit growth of 18.1% in 2026, driven by continued expansion in its software outsourcing business. With competitive pricing, strong engineering capabilities, and reliable delivery, FPT is rapidly scaling as a global IT services provider, winning major international clients and delivering high‑value solutions that support its long‑term structural growth. We also anticipate pretax profit margin improving from 15.5% in 2025 (compared with 19-27% for Indian IT services providers) as the company scales its operations, enhances productivity, and expands its portfolio of advanced IT services.
PNJ’s share price remained strong in January, supported by expectations of solid Q4/2025 earnings. The company has confirmed these results, reporting revenue growth of 12% YoY and a sharp 66% YoY increase in net profit, both above our forecast. This performance was driven by well‑timed inventory purchases made earlier in the year, market-share gains, and a recovery in demand for discretionary gold jewelry toward the year-end.
For full‑year 2025, revenue declined 7.5%, broadly in line with our projections. The drop was mainly due to a steep fall in 24K gold trading activity (-43% YoY). This segment historically accounted for over 30% of revenue but contributed less than 5% of profit. In 2025, sales volumes of 24K gold contracted significantly following the State Bank of Vietnam’s tighter controls on gold imports and smuggling, which reduced supply across the market. PNJ focused on securing gold for its jewelry production rather than for 24K gold bars. Its retail jewelry revenue still increased 11% YoY in 2025. Net profit grew 34% YoY in 2025 thanks to a gradual recovery in demand since Q2/2025, flexible inventory management, cost-cutting efforts, as well as high gold prices.
Store expansion remained disciplined as the company added a net three new stores in 2025, bringing its network to 431 locations nationwide. During the period, PNJ relocated several stores from shopping malls to larger main‑street locations to improve customer experience and product display. Retail sales per store rose 6.2%, supported by continued market share gains and higher selling prices in line with rising gold prices.
Looking ahead, we expect PNJ to deliver earnings growth of about 12% in 2026, despite the strong base in 2025. Over 2025–2028, we forecast an earnings compound annual growth (CAGR) of around 11%, underpinned by PNJ’s position as the leading jewelry manufacturer and retailer in Vietnam. A new regulation on the removal of the State’s monopoly on the import and production of gold bars in Vietnam is also expected to ease the gold material shortage and promote well-established companies.
VRE’s share price fluctuated in January after doubling last year on the back of a strong 57% earnings growth. We reduced our position during the rally, as we saw most of the short‑term good news had already been priced in.
In 2025, VRE’s revenue was broadly flat, but net profit rose significantly by 57% YoY. Part of this came from a one‑off gain from an asset transfer, but the core leasing business also performed well. Leasing revenue grew about 8% YoY, or roughly 10% on a like‑for‑like basis excluding a divested mall. The company also opened three new malls, expanding its national network to 90 locations, reinforcing its position as Vietnam’s largest retail operator.
Operationally, VRE continued to make steady progress. Occupancy improved to 88.1% (+2.1 percentage points), helped by active tenant management and a shift toward categories that better match current consumer trends, such as food, beverage, and entertainment. Around half of the newly leased space in the past two years has gone to new brands, reflecting VRE’s strong appeal to both international and domestic retailers. Refurbishment of older malls also paid off, with noticeable increases in foot traffic after upgrades.
Looking ahead, we expect earnings to decline in 2026 because there will be no one‑off gain. However, the leasing business will continue to grow, supported by the launch of a new mall, the full‑year contribution from the three malls opened in 2025, and an expected increase in occupancy at existing malls. The long‑term outlook also remains positive. We forecast an average net profit growth rate of about 12% over 2026–2030, supported by continued expansion and further improvements to existing malls. VRE’s connection to the broader Vingroup ecosystem also gives it access to prime locations, supporting future growth.
Strong returns in January reinforce our principle and commitment to investing in high‑quality companies with steady, long‑term earnings growth. We expect portfolio companies to deliver net earnings growth of 17.1% in 2026 and an average of 16.8% over the next three years. We believe these businesses are well-positioned to benefit from Vietnam’s long‑term structural trends as the economy expands, incomes rise, more people move to cities, and consumers increasingly look for better consumer and healthcare products and services. We remain focused on quality, valuation discipline, and long‑term opportunities as we work to grow our clients’ capital.