20160708_BSC_Vietnam Sector Outlook_EN_2016Q3_PUBLIC

Sector Outlook 3Q2016
•           We maintain a OUTPERFORM assessment for the sectors: Real Estate, Construction, Building materials (tiles, plastic), Technology, Sea Ports, Textile, Power, Milk and Cable. Downstream sectors of Real Estate are expected to maintain gains in the near future. Infrastructure sectors such as Port, Power are expected to maintain sustainable growth.
•           We assess MARKET PERFORM with sectors: Plastic, Steel, Sugar, Tires, Cement, Automotive, Insurance and Banking, Pharmacy and change the outlook from Underperform to Market perform for 2 sectors: Oil & Gas and Natural Rubber, and down from Outperform to Neutral outlook for Fertilizer. The overall outlook for this group mixes of good and bad factors.
•           On the side of sectors with UNDERPERFORM Outlook, we still maintain this assessment with Marine Transportation and Aquaculture Sectors as reported in 1Q2016 sector outlook. With complicated movements of commodity prices, as well as the effects of Brexit, the sectors with large export to Europe will have more negative prospect.
•           The Seasonality. The third quarter is usually the time with more exciting business activities than the first two quarters of year. We expect the downstream sectors of the Real Estate (construction and building materials) continue to grow. Sectors of Sea Ports, Power and Infrastructure continue to improve earnings. The rainy season also makes the agricultural and power sectors to have more volatility.