PYN Elite down 11.2% in February

— 07.03.2023

VN Index -7.8% in Feb on a broad market sell-off fueled by real estate companies. PYN Elite -11.2% on VHM, CTG and STB. A prominent developer (not our portfolio company) postponed bond coupon payments due to financial constraints. Although the default risk is limited to individual companies, investors grew impatient with the government’s slow response. We see conditions are improving: interest rate dropped by up to 1% YTD, and banks showed evidence of processing strong collaterals. The appointment of a new president the set stage for a more stable political outlook. The long-awaited amendment of decree 65 finally got approved on 5th March that allows corporates to extend bond tenor and convert bonds into other assets, which can reduce default risks significantly.

Macro: PMI rose to 51.2 in February from 47.4 in January, marking the first expansion in the manufacturing sector following a 3-month decline since last October. The survey respondents commented that that is a sign of improvement in demand both domestically and internationally. New orders, employment and production output all returned to growth. I n 2M 2023: Retail sales +13% YoY, and public investment disbursement +18.3% YoY on expressways projects. Headline inflation eased to 4.3% in Feb from 4.9% in January, which was lower than anticipated.

PYN Elite stock of the month: TPB

In 2022, TPB gained 3.7 million new customers, ranking 2nd in new user acquisition among banks, bringing in a total of 8.3m customers (+45% YoY). According to market research company CIMIGO, TPB ranks #1 by Net Promoter Scores (NPS) among all banks, reflecting strong customer loyalty and brand recognition. Fast user growth and loyalty supported TPB’s CASA deposit growth in 4Q 2022, despite high interest rates that shrunk CASA at other banks. TPB’s fee growth also increased by 75% YoY, ranking 2nd among peers. TPB’s loan-loss-reserve and loan-to-value ratio are safer than the industry average. TPB declared a cash dividend of VND 2500/share to be paid on 3 April, offering a 10.7% dividend yield.

Important information regarding the text and the Fund

The attached publication is marketing material and should not be regarded as a recommendation to subscribe or redeem units of the PYN Elite Fund. Before subscribing please familiarize yourself with the Key Information Document, the Prospectus and the Rules of the Fund. The material presented in this text is based on PYN Fund Management’s view of markets and investment opportunities. PYN Elite Fund (non-UCITS) invests its assets in a highly allocated manner in frontier markets and in a small number of companies. This investment approach involves a larger risk of volatility compared to ordinary broadly diversified equity investments. The value of an investment may decline substantially in unfavorable market conditions or due to an individual unsuccessful investment. It is entirely possible that the estimates of economic development or a company’s business performance presented in this presentation will not be realized as presented and they involve material uncertainties.

PYN Elite Monthly Review.pdf


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