Shares in VinaCapital Vietnam Opportunity Fund (LON:VOF) have the headroom for significant growth, based on research compiled by the City broker Liberum.
In a 24-page initiation note, analyst Myrto Charamis valued the stock at US$3.73 compared with the current share price of US$2.53.
She said Vina offers “access to high-growth opportunities through investments in private equity, pre-IPO and listed companies”.
“Vietnam is one of the fastest growing economies with a young population undergoing urbanisation,” she added, pointing out the “country is politically stable and its newly elected government remains committed to reforms and development”.
The International Monetary Fund is projecting Vietnam will grow 6.3% this year and 6.2% next, even though drought took a toll on the country's agricultural sector in 2016.
“[Vina] is planning to take advantage of the rise of the middle class in Vietnam and target sectors that benefit from higher disposable income such as education, healthcare and media,” Charamis added.
“Vietnam’s population has a median age of 30 years and is well educated and tech-savvy.”