Vietnam Market in 2025: Investment Opportunities in a Developing Economy

Market Overview and Growth Trends

This year will be a pivotal time for those interested in accessing the Vietnamese market. After a correction in early April, the Vietnamese stock market shows signs of a strong recovery. In 2024, the gross domestic product (GDP) is projected to expand by 7.09%, and it is expected to grow by no less than 6.7% this year, according to Standard Chartered Bank forecasts.

What’s interesting is that Vietnam’s economic growth rate exceeds the regional average and remains three times higher than neighboring Thailand. This result reflects the strength of the macroeconomic fundamentals.

From Frontier to Emerging Market: The True Meaning of the Change

This year, Vietnam’s market will be upgraded from (Frontier Market) to (Emerging Market) status by the end of the year. This change is not just about reclassification but has significant implications for the inflow of global funds.

According to MSCI data, the current global frontier market funds amount to only $100 billion USD, while emerging market funds are valued at approximately $6.8 trillion USD. When Vietnam is upgraded, funds tracking MSCI Emerging Markets will need to adjust their portfolios to include Vietnamese stocks, resulting in a natural and continuous flow of investment capital.

Analysis of Eight Major Vietnamese Market Stocks

1. VCB (Vietcombank): The Heart of the Financial System

Vietnam’s Vietcombank (VCB) is the largest financial institution with the highest market value on the stock exchange. The bank demonstrates stable management capabilities and is a solid cornerstone for foreign institutional investors.

In the context of economic growth, demand for financial services will naturally increase. Meanwhile, banking access levels in Vietnam are still below those of developed countries, creating a gap filled with opportunities. Coupled with the digital revolution in banking, VCB is well-positioned for sustainable growth.

2. VHM (Vinhomes): The Victory of Real Estate Development

Vinhomes (VHM) is the largest residential real estate company, covering apartments, detached houses, townhouses, and premium villas. It is a subsidiary of Vingroup, which accounts for 2.2% of the country’s GDP, providing a competitive advantage.

The expansion of the middle class, increasing urban industrialization, and ongoing infrastructure development all positively impact location quality. Currently, Vietnam’s urban population is lower than Thailand’s but is growing rapidly, creating continuous demand for quality housing.

3. GAS (Petrovietnam Gas): Key Energy Resources

As a leading energy company operating from exploration to distribution, GAS plays a strategic role in the economy, supported by the government and accessing specific resources.

As Vietnam accelerates infrastructure development, energy demand will rise accordingly. Natural gas is a necessary fuel for the transition to environmentally friendly energy. Despite fluctuations in global market prices, Vietnam’s development policies continue to position GAS as a long-term strategic asset.

4. VNM (Vinamilk): Market Leader in Dairy Products

As the first dairy company in Vietnam, VNM holds a solid position, reaching 40 countries and with a market value of over $6.48 billion USD.

The main issue is that per capita milk consumption in Vietnam remains below that of neighboring countries, indicating enormous growth potential. As income increases, consumers will prioritize health and food choices, driving VNM forward. Additionally, VNM pays consistent dividends and maintains strong financial reserves, making it an attractive option for investors seeking both growth and income.

5. FPT: Vietnam’s Technology Sage

As a globally renowned technology company, FPT provides IT outsourcing services to major tech firms worldwide. This business model benefits from high-quality IT personnel at lower labor costs compared to developed countries.

In the digital transformation era, demand for AI, Cloud Computing, and Big Data services is increasing rapidly. FPT has invested in these technologies, positioning itself to capture a large share of the future market. Analysts believe FPT could become Vietnam’s most valuable company within the next 10 years.

6. MSN (Masan Group): Logistics, Food, and Retail

Masan Group has diverse businesses, notably influential in instant noodles, condiments, and related products. Additionally, MSN acquired the retail chain VinMart, with over 3,000 stores, helping the company expand into the promising retail sector.

In response to changing consumer behaviors, MSN has developed new products such as health foods and premium foods, aligning with the growth and evolving tastes of the middle class.

7. VRE (Vincom Retail): Shopping Mall Owners

As a leader in shopping malls, VRE manages a portfolio of high-traffic, modern-designed projects supported by the strong Vingroup conglomerate.

VRE’s mall development projects benefit from the expansion of the middle class and Vietnam’s consumer culture shifting toward shopping centers. The presence of global retail brands like Zara, H&M, and Uniqlo adds further appeal and opportunities for rent increases.

8. ACV (Airports Corporation of Vietnam): Air Transport Infrastructure

Managing Vietnam’s main airports, including Tan Son Nhat and Noi Bai, ACV is positioned to benefit from the growth of tourism and air transportation.

The Long Thanh airport project, under construction and designed to handle 100 million passengers annually, will enhance service capacity and create growth opportunities for ACV in the next decade.

Impact of the Correction on the Market: Expert Opinions

The sharp correction in April was driven by external factors such as trade policies and movements in the US markets. Many experts see this as a “good time to buy” for long-term investors.

Markets often overreact to short-term negative news. Such corrections typically present opportunities to buy quality stocks at better prices, especially in economies with strong fundamentals like Vietnam.

How Thai Investors Can Access the Vietnamese Market

Option 1: Through a Thai Broker Account

The easiest and most convenient way is to open an account with a Thai broker offering international stock trading services, such as Kasikorn Securities, SCB Securities, or Bualuang Securities.

Steps:

1. Contact the broker for details
2. Prepare documents such as ID card, passport, and financial proof
3. Deposit funds into the account
4. Place orders online

Advantages: Convenient, no language barrier Disadvantages: Fees may be higher

Option 2: Direct Account with a Vietnamese Broker

For direct market access, open an account with Vietnamese brokers such as SSI Securities, VNDirect, or HSC.

Steps:

1. Email or call the broker
2. Prepare documents such as passport and proof of address
3. May need to travel to Vietnam to sign documents
4. Transfer funds into the account

Advantages: Lower fees, direct market data Disadvantages: More time-consuming and complicated

Option 3: Investment via Mutual Funds

Many Thai mutual funds have policies to invest in Vietnam, such as Eastspring Vietnam Equity Fund or Bualuang Vietnam Equity Fund.

Advantages: No need for individual analysis, diversification, managed by professionals Disadvantages: Management fees and other expenses

Option 4: International Online Trading Platforms

Platforms like Interactive Brokers, Saxo Bank, or Tiger Brokers offer international stock trading, including Vietnam.

Advantages: Easy to use, low fees, analytical tools Disadvantages: Not always supporting Thai language, requires understanding of terms

Conclusion: The Future of Vietnam Market Investment

Vietnam’s market is at a critical turning point full of possibilities. Its remarkable economic growth, upgrade to emerging market status, and recovery after correction all point to positive long-term opportunities.

The eight stocks analyzed—VCB, VHM, GAS, VNM, FPT, MSN, VRE, and ACV—each have high potential aligned with the country’s development trends. They offer resilience and unique characteristics.

However, investing always involves risks. Investors should conduct thorough research and consider their investment goals and risk tolerance before making decisions. Investing in new markets requires understanding and proper preparation.