A worker operating a production line in My Phuoc 3 Industrial Park in Binh Duong province. (Photo: VNA)In its latest report, Mirae Asset (Vietnam) Securities said thatthe total after-tax profit of listed companies decreased by 18% year-on-year inthe first quarter of 2023. But business results will recover this year, eventhough not strongly due to the challenges that the economy is facing.
Exports are showing signs of improvement in May on Vietnam’sstrong trade promotion, despite persistently weak global demand, the securitiesfirm said.
Data from the General Statistics Office showed that exportturnover was estimated at 29.05 billion USD last month, up 4.3% over April butdown 5.9% year-on-year.
Mirae Asset expects the recovery from the Chinese market afteropening will partly offset the decline from the US market. Thereby, thecountry’s exports and industrial production activities are expected to be morepositive in the second half of the year.
Meanwhile, disbursements of FDI remained stable in the first fivemonths of the year, reaching about 7.65 billion USD.
The analyst team at Mirae Asset believes that Vietnam remains an attractivedestination when businesses consider the China plus one strategy, in whichcompanies avoid investing only in China and diversify their activities to othernations, as well as when global economic conditions improve.
Similarly, VNDirect Securities Corporation said that the wholemarket’s profits might recover from the third quarter of 2023 onward.
Accelerating disbursement of public investment, lower interestrates, and the recently passed Power Development Plan 8 are attributed to therebound in profits of listed companies, said both securities companies.
Mirae Asset said that public investment in infrastructuredevelopment and the national Power Development Plan 8 will be important driversto attract FDI in the long term. At the same time, stable human resources andefforts to reform administrative procedures are also positive points.
Particularly, public investment is a key growth driver in theremaining months of 2023 but disbursement progress needs to accelerate,Mirae Asset added.
In the first quarter of 2023, realised capital from the statebudget increased by 18.1% year-on-year to 91.5 trillion VND (nearly 4 billionUSD), higher than last year's growth of 12.3%.
Meanwhile, VNDirect said that even though it has reached a sufficientand green option, the Power Development Plan 8 may be more difficult toimplement than the adjusted Power Development Plan 7 due to the strongdevelopment of high-priced power sources such as gas and renewable energy.
According to the base scenario, the total investment in power isexpected to reach 98 billion USD in the period of 2021-2030, or 9.8 billion USDper year, mainly allocated to gas power (30%) and wind power (35%).
Therefore, not only electricity producers but also relatedconstruction companies benefit from the plan, Nguyen Minh Hoang, Director ofthe Analysis Department at VietFirst Securities, told VietnamNews.
In addition, continuous rate cuts from the central bank helpreduce enterprises' expenses, especially in the manufacturing, power, andinfrastructure construction industries, he added./.
VNA
