Asia Frontier Capital Launches Vietnam Fund

Dec 3 2013 | 10:52am ET

Asia Frontier Capital Limited has launched a Vietnam-focused fund.

The open-ended, Cayman-domiciled AFC Vietnam Fund, available for subscription to qualified new investors as of December 10, will invest in Vietnamese listed equities. The fund has a target size of US$50 million.

Overseeing the new fund will be AFC's two Andreas—CEO Andreas Vogelsanger and CIO Andreas Karall—and COO and founder Thomas Hugger. The Vietnam fund will focus on growth companies, particularly small to medium-sized firms.

“After a 70-90 % price decline in the years 2007-2012, we now see enormous upside potential in this new business cycle which has just started and is expected to last for the next 5-7 years” said Karall, in a statement. “About one third out of more than 700 listed Vietnamese stocks have a P/E ratio between 6x and 7x, are trading below book value, many of them have a dividend yield of more than 9% and there are even some companies whose net cash position is almost as high as their market cap.”

“Vietnam’s growth prospects are very compelling, especially with the restructuring of the banking sector and various government stimulus packages to support the economy” said Vogelsanger, in a statement. “A stable local currency combined with very competitive labour costs will help to further accelerate foreign direct investments into Vietnam.”

Hugger characterized the new fund as “an excellent addition to the well-established flagship AFC Asia Frontier Fund which provides investors with exposure to Vietnam as well as listed equities across high-growth Asian frontier markets including; Bangladesh, Cambodia, Iraq, Laos, Mongolia, Myanmar, Pakistan, Papua New Guinea, Sri Lanka and Vietnam.”


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