Vietnamese economy expected to grow by 10% in Q3 2022: VinaCapital

The company recently organised a webinar to review Vietnam’s economy and stock market in the first half this year.

“Our expectation that Vietnam’s economy will grow by at least 7.5 per cent this year (and by at least 10 per cent in Q3) leads us to believe that the consensus forecast for 16 per cent earnings growth this year in Vietnam is too conservative,” the company said.

“We expect earnings growth to exceed 20 per cent this year, supported by Vietnam’s solid economic performance—in stark contrast to the US stock market, where earnings growth expectations look unrealistically high, especially given that country’s deteriorating economic outlook,” VinaCapital said in a press release.

The year-on-year surge in Vietnam’s retail sales has accelerated all year, which clearly illustrates that domestic consumption in Vietnam is currently the country’s main economic growth driver.

In the first half of this year, Vietnam’s real retail sales (i.e., excluding the impact of inflation) grew by 7.9 per cent YoY; this figure surged to 11.9 per cent in the first seven months this year, which is far above the 7 per cent YoY growth that VinaCapital had previously been forecasting for 2022.

While a slowing US economy is likely to temper Vietnam’s export growth and economic growth, the impact of that slowdown will be more-than-offset by Vietnam’s strong domestic economy, the company noted.

Vietnam’s economy is even stronger than the company had expected at the beginning of the year, but that strength is not reflected in higher stock prices due to the US Federal Reserve’s aggressive rate hikes and the recent regulatory crackdown in Vietnam.

Fibre2Fashion News Desk (DS)