VinaCapital funds update. VOF Vietnam Opportunity Fund Ltd VNI Vietnam Infrastructure Ltd VNL VinaLand Ltd

Transcription

1 VinaCapital funds update VOF Vietnam Opportunity Fund Ltd VNI Vietnam Infrastructure Ltd VNL VinaLand Ltd June 2011

2 Disclaimer The information contained herein has been prepared by VinaCapital Investment Management Ltd. (the Company") and is subject to updating, completion, revision, further verification and amendment without notice. The information contained herein has not been approved by any listing authority or any investment regulator. The information does not constitute or form part of any offer for sale or solicitation of any offer to buy or subscribe for any securities nor shall they or any part of them form the basis of or be relied on in connection with, or act as any inducement to enter into, any contract or commitment whatsoever. No undertaking, representation, warranty or other assurance, express or implied, is made or given by or on behalf of the Company or any of its directors, officers, partners, employees, agents or advisers or any other person as to the accuracy or completeness of the information or opinions contained herein and no responsibility or liability is accepted by any of them for any such information or opinions or for any errors, omissions, misstatements, negligence or otherwise for any other communication written or otherwise. Past performance in relation to any of the investments contained in this presentation is not indicative of the future performance of any investment that the Company may be involved in. The performance of any investments may differ from the performance of the investments shown in this presentation and such difference may be material. There is no guarantee that any investment opportunity similar to those presented herein will materialize or that the Company will generate any favorable return or any return at all from any such investment opportunity. Certain information contained in this presentation constitutes forward-looking statements. Such statements may be subject to a number of factors and uncertainties that could cause actual events or results to differ materially from those reflected or contemplated in such forward-looking statements. This presentation is not an advertisement and is not intended for public use or distribution. The information herein may not be reproduced, redistributed or passed to any other person or published in whole or in part for any purpose. By accepting receipt of this document, you agree to be bound by the limitations and restrictions set out above. Neither these pages nor any copy of them may be taken or transmitted into or distributed in any jurisdiction where the distribution of such material would be prohibited under the jurisdiction s applicable securities laws. Any failure to comply with this restriction may constitute a violation of such securities laws. 2

3 Contents 1. Vietnam in 2011: economy and real estate market 2. VNL overview 3. Exit track record 4. Portfolio breakdown and NAV movement 5. Top ten holdings 3

4 Introduction VinaCapital Group VinaCapital Group is the leading asset management and investment banking firm in Vietnam. VinaCapital Group was founded in 2003 and is based in Ho Chi Minh City, with branch offices in Hanoi, Danang, Nha Trang, Phnom Penh and Singapore. The Group: Manages USD1.7 billion in three listed and two unlisted funds. Holds stakes in VinaSecurities JSC, a full-service brokerage, and in VinaProjects JSC, a real estate project and construction manager. Offers class-leading expertise in capital and debt markets, securities, private equity, real estate and infrastructure investment. In 2010, opened offices in Singapore and Phnom Penh. VinaCapital Group (VCG) has over 180 investment professionals in four offices in Vietnam. Our funds: Vietnam Opportunity Fund (VOF) VinaLand Ltd (VNL) Vietnam Infrastructure Ltd (VNI) Vietnam Fixed Income Fund (VFIF) DFJ VinaCapital LP 4

5 Vietnam in 2011: A challenging year Vietnam s 2010 recovery took a step backward in 2011 due to inflation and currency pressures GDP growth: 6.8% with 11.8% inflation. By May 2011, inflation 19.8% y-o-y, while GDP growth for Q1 at 5.4% y-o-y. What happened? Premature monetary loosening in Q Credit growth too high, public investment efficiency too low. Vinashin news decreased international confidence in VN debt. Global commodity prices rose. FX reserves at USD13.5bn in early 2011 (only 1.9 months import coverage). Macroeconomic indicators and forecast 2010 May-11 YTD Y-o-Y change GDP growth 1 6.8% 5.4% Inflation 11.8% 2.2% 12.1% 19.8% FDI (USDbn) Imports (USDbn) Exports 2 (USDbn) Trade deficit (USDbn) Exchange rate 3 (USD/VND) Bank deposit rate (VND %) % % % % 19,500 20, % n/a % % n/a n/a 5

6 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Vietnam in 2011: Policies to combat inflation Result of Q loosening and subsequent events: Currency under pressure in early 2011, February devaluation required. Four devaluations in past 18 months, 20% depreciation. Inflation increased rapidly; Interest rates increased, tightening policies put in place. Monetary and fiscal tightening actions taken to support currency, reduce inflation. Cost of borrowing for businesses at 23-25% makes growth financing unaffordable. Policies options being considered: Subsidised loans for businesses. Increased VND reserve requirements. Mandatory treasury bills. Vietnam key interest rates, Base Rate Refinancing Rate Discount Rate 16.00% 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% Other policies put in place included: Stabilisation funds for consumer staples. USD3 billion in govt spending cuts. Gold jewelry export tax of 10%. Cap put on USD deposit rates of %. SOEs forced to sell USD. 6

7 Vietnam in 2011: Outlook Outlook for end 2011 and Inflation to peak in Q2 at ~22%, end 2011 at ~15%. Current account deficit ~5% at end F/X stable, will only change if interest rates decline notably. Capital flight to gold should subside, banks will have improved liquidity. GDP growth expected at 5.5-6% for 2011, with potential for return to high growth in FDI still on pace for USD10-11bn disbursement in Downside risks: Govt must maintain tightening policies! Commodity price surge or debt crisis in Europe are risks. 7

8 Vietnam s real estate market in 2011 A challenging, high-interest rate environment. Commercial projects under construction stalling as developers cannot take on high-interest loans. Office market oversupply to continue for months. Operating hotels recovering as tourism numbers continue to rise. Demand exists for 200,000 new residential units, but buyers are waiting for prices to drop (and mortgage rates to decline). Condo oversupply; Only 50% of the 100,000 planned units likely to be built in next few years. Only landed property is moving (villas). Developers who can bring affordable product to market will do well. Key is bringing landed properties to market in the USD90-150,000 range; only the top developers can do this. Population density (persons/sq.km) Persons per household Long-term demand for new housing given demographic and income/culture changes. 8

9 VinaCapital funds VinaCapital AIM-traded funds Combined NAV: USD1.7 billion (31 May 2011) VinaCapital Vietnam Opportunity Fund Ltd VinaLand Limited Vietnam Infrastructure Limited Closed-end fund Closed-end fund Closed-end fund Opportunity fund tapping growth and development of Vietnam. Equity and debt in listed, OTCtraded and private companies. Investment in existing properties and new developments in Vietnam. Infrastructure and related assets in Vietnam and surrounding Asian countries. NAV: USD745m NAV: USD687m NAV: USD206m Diversified Real estate Infrastructure 9

10 Performance of listed funds comparison to competitors VinaCapital funds have performed at or above the peer average VinaCapital Dragon SAM PXP Others YTD 2011 Cumulative VOF -47.1% 31.0% -1.6% -3.5% -34.2% VNL 16.8% -9.2% 1.4% -2.8% 4.6% VNI -36.9% 3.1% -13.4% -12.1% -50.5% VEIL -60.7% 12.1% -2.8% -18.0% -64.7% VGF -61.4% 12.1% 7.6% -16.4% -60.2% VRF -23.4% -30.9% -27.8% 3.3% -60.5% VPF -6.0% 9.6% -6.8% -12.5% -16.0% VEH -23.8% 44.0% -10.7% 3.4% 1.3% VPH -2.1% 16.4% -1.1% -30.0% -21.1% PXP -70.9% 76.8% -18.1% -23.0% -67.5% VEEF -73.5% 82.6% -21.2% -23.1% -70.7% Prudential -57.0% 47.0% 1.0% -11.1% -45.3% Mekong -67.7% 58.8% 3.5% -14.1% -54.4% DWS -54.0% 19.6% -9.1% -12.0% -56.0% Vietnam Holding -60.3% 57.6% -7.6% -18.7% -53.0% VNM ETF N/A 1.8% 2.7% -21.8% -18.2% FTSE Vietnam ETF -63.6% 39.7% -14.8% -26.4% -68.1% VN Index -66.0% 56.8% -2.0% -13.1% -54.6% Capital markets funds -59.8% 49.1% -7.0% -15.7% -52.8% Non-VinaCapital funds -46.7% 33.8% -7.8% -14.3% -47.3% Diversified funds -32.3% 14.1% -5.7% -10.2% -36.6% All -41.9% 28.7% -7.1% -12.7% -43.2% VOF has outperformed peer benchmarks (capital markets funds, non-vinacapital funds and diversified funds) VNL has returned the best performance since

11 Vietnam Opportunity Fund Ltd (VOF) 11

12 VOF overview Vietnam Opportunity Fund (VOF) Fund launch September 2003 NAV and share price performance (31 May 2011) NAV of fund (May 11) NAV per share USD745m USD2.30 NAV gain since launch 136.8% NAV 2010 change -1.0% Market cap (May 11) USD510m Investment mandate Privately negotiated investments in private and listed companies, with a focus on: - Sectors that support domestic growth - SOE privatisations - Selective real estate investments Share price discount 31.7% at end-may 2011, down from over 60% during Q Investor sentiment low due to 2011 macro challenges, poor VN Index performance. Exits continue to demonstrate value of VOF s holdings. 12

13 Top 5 holdings by asset class VOF portfolio is highly diversified within each asset class sector (top holdings as of 31 May 2011). Listed securities Stake (%) Sector Vinamilk (VNM) 2.6% Consumer goods Eximbank (EIB) 5.0% Financial services Hoa Phat (HPG) 4.8% Industrial Quoc Cuong (QCG) 11.4% Real estate Kinh Do (KDC) 8.3% Consumer goods Private equity Stake (%) Sector Hoan My Hospital 28.9% Healthcare Cofico 25.1% Real estate IBS 100.0% Materials SSG Saigon Pearl 6.2% Real estate Thang Loi Textile 100.0% Consumer goods OTC securities Stake (%) Sector An Giang Plant 7.4% Agriculture Prime Group 7.1% Materials Nam Viet Oil 11.6% Energy Thang Loi Land 6.4% Real estate Lam Thao 7.1% Fertiliser Real estate projects Stake (%) Sector Sapphire 50.0% Hotel Cambridge 21.0% Township Jupiter 18.0% Township Nile 15.5% Mixed use Volta 30.0% Mixed use 13

14 Recent investments VOF remains focused on sectors that will benefit from Vietnam s domestic economic growth, particularly the rise of an urban middle class with higher disposable income. Consumer goods Yen Viet JSC is Vietnam s top producer and distributor of bird s nest nutritional products, a high-cost health supplement with a huge growth market, particularly in China. VOF holds a 20.0 percent equity stake in Yen Viet. Healthcare Hoan My Medical Corporation is Vietnam s top private healthcare provider. The private healthcare sector is growing at over 30 percent yearly, and Hoan My is the market leader with four operating hospitals and one under construction. VOF holds a 28.9 percent equity stake in Hoan My. Materials Prime Group JSC is Vietnam s leading ceramics manufacturer. With the market for construction materials growing rapidly, Prime s 2009 earnings of USD16 million are expected to grow at 30 percent yearly for at least the next three years. VOF invested USD15 million for a 7.0 percent equity stake. Agriculture Thai Hoa Coffee JSC is Vietnam s third largest coffee producer and the market leader in the highvalue arabica sector. VOF holds a 10.0 percent equity stake in Thai Hoa Coffee. 14

15 Significant disposals in 2010 and 2011 VOF remains Vietnam s most active deal-maker, closing one of the largest-ever private equity deals (ex. infra and real estate) in January Education International School of Ho Chi Minh City (ISHCMC) is the top international school in Ho Chi Minh City. VOF sold a majority of its equity stake to a leading international education group. Consumer goods Hanoi Liquor JSC (Halico) is Vietnam s leading Vodka producer and distributor. VOF sold a 23.6 percent stake in Halico to Diageo plc for USD51.6 million, for a 5.3x return. Consumer goods Vinacafe is Vietnam s leading instant coffee producer, focused on Robusta beans. Current investee Thai Hoa Coffee focuses on Arabica beans. VOF sold its stake in Vinacafe for an IRR of 45 percent over five years. Real estate Residential real estate sales and reservations (villas and condo units) totaling almost USD50 million at projects including Niagara and Danube in Danang, and Jupiter in HCM City. VOF has minority stakes in the largest portfolio of residential real estate developments in Vietnam. Upcoming divestments: Real estate, consumer goods, and food & beverage. 15

16 Trading highlights and asset class allocation VOF transactions record from June 2010 to April 2011 VOF portfolio by asset class (31 May 2011) Investment Highlights Top 5 BUYING USD 000 Quoc Cuong RE developer 12,360 An Giang Plant protection 9,643 Kinh Do F&B and Property 4,497 Thai Hoa Coffee Plantation 3,385 Binh Dien Fertiliser 2,574 Others 25,062 Total BUY 57,521 Top 5 SELLING USD 000 Halico Vodka producer 40, % 80% 60% 40% 20% 13.2% 1.5% 7.2% 9.2% 35.2% 33.6% Cash and other assets 13.2% Bonds 1.5% Private equity 7.2% OTC stocks 9.2% Listed equity 35.2% Real estate 33.6% Vinacafe Coffee Producer 8,044 Exit Highlights ITA IP developer 6,938 Quoc Cuong Property developer 6,231 0% by asset class (%) Kinh Do F&B and Property 4,226 Others 24,844 Total SELL 91,253 16

17 Fund strategy and objectives investment What investment strategies will be deployed to enhance NAV? VOF portfolio Target allocation Capital to be deployed Number of Deals Asset Allocation Target USD80m for the next 6 months. Target 5 deals, of USD10-15m/deal. Listed equities target allocation: reduce to 30% (current 39%) over the next months by divestment of matured local listed shares. OTC equities target allocation: increase to 20% (current 8%). Three OTC stocks An Giang, Cau Tre, and Lam Thao will delay listing until Q due to current market conditions. Expected additional investment into some positions. Private equity target allocation: increase to 20% (current 6%). Current PE pipeline of over USD100m. Expect to close at least 3 deals with total investment size of USD25m over the next 3 months. Real estate and hospitality target allocation: reduce to 20% and 5%, respectively (current: 25% and 10%) through divestments in the next 6-12 months. Current 30 Apr 2011 Next 6-12 Month Target Next Month USDm % % % Listed Equities OTC Equities Private Equity Real Estate Hospitality Bond Cash & Others* TOTAL NAV Priority Sectors Agriculture Education Consumer Oil & Gas Pharmaceutical Healthcare * In which, free cash: USD27m 17

18 Fund strategy and objectives portfolio management Reduce exposure to real estate (RE) sector. Divesting from mature property/hospitality projects; seeking for co-investment opportunities for on-going RE projects; and sell mature RE listed shares. Reduce exposure to mature listed OTC stocks (post-listing). Sell down mature listed stocks when market recovers, particularly mature RE and RE-related stocks. Strategy Recycle cash for new investment opportunities, particularly for M&A opportunities. Enhance value of current portfolio holdings to generate more upside. Take opportunities to trade listed blue-chips for short term gains and improve performance of capital markets component. Target large-cap companies with leading market share, strong earning growth, effective management and reasonable valuations (listed, OTC, PE, privatisations). Discuss potential new share issues with good discounts, focusing on non-real estate companies and expansion projectss Buying range: VN Index < 450 (PE 9.3x). Selling range: VNIndex > 500 (PE 10.3x). 18

19 Vietnam Infrastructure Ltd (VNI) 19

20 VNI introduction Vietnam Infrastructure Limited (VNI) Fund launch July 2007 NAV and share price performance (31 May 2011) Return since launch -38.7% (31 May 11) NAV of fund (May 11) USD 206.1m NAV per share USD NAV 2011 change -9.8% Discount to NAV 40.1% (31 May 11) Investment mandate Investment in infrastructure assets including energy, transport, industrial parks, telecoms, environment and agribusiness infrastructure in: - Vietnam (minimum 70%) - Cambodia and Laos. VNI remains the only investment fund for infrastructure assets in Vietnam and surrounding countries. The fund is expanding to new higher beta asset classes in (eg. agriculture-related opportunities). 20

21 VNI invested capital and cash balance Committed and under DD (USD) Committed 2.83m Agribusiness 1.5m Industrial park 0.5m Hydropower 0.48m General Infrastructure 0.35m Under due diligence 27.5m BTS/IBS 25.0m Transport/logistics 12.5m 66.5% of NAV (USD137.1m) is invested at May % of NAV (USD28.6m) is free cash. 21

22 VNI top portfolio holdings (as of 31 May 2011) Type Sector % NAV Investment date Description Exit strategy Long An SEA PE Industrial park 9.3% Mar ha IP, port and service park area located 30km south of HCM City. Land infill and resettlement in process. Seek exit via sale to IP operator. Nam Viet Oil OTC Energy 5.1% Oct-09 First private sector refinery in Vietnam, with 5,000 bbl/d capacity. Expected to list on HOSE in Q Ba Thien IP PE Industrial Park 4.6% Jun-08 Located 50km north of Hanoi and 20km from Noi Bai International Airport. Expected to lease out to industrial tenants in light and clean industry and high-tech sector. Singed up first anchor tenant with 20ha, second tenant under due diligence. Will exit through selling to an IP operator. 22

23 VNI top portfolio holdings (as of 31 May 2011) Type Sector % NAV Investment date PVD Listed Energy 4.5% Jun-09 VNC-55 PE Telecom 4.1% Oct-08 Description Industry leader in providing Mobile Offshore Drilling Units, drilling services, oil & gas equipment/tool rental services, supporting services in oil & gas production. JSC specialised in BTS building and leasing, based in Danang. VNI holds 40%. Exit strategy Sell equity stake when VN Index recovers. Consolidate into wholly owned BTS portfolio company and exit through trade sale or listing. VALC OTC Transport & Logistics 3.7% Dec-07 First aircraft leasing company in Vietnam; 79% owned by SOEs including Vietnam Airlines, BIDV, PetroVietnam, VinaShin & Phong Phu Corp. Seek trade sale to foreign aircraft leasing companies or exit via local listing. MIDC PE Telecom 3.7% Feb-08 JV specialised in BTS building and leasing, based in Hanoi. VNI holds 49%. Seek sale of equity stake. 23

24 VNI top portfolio holdings (as of 31 May 2011) Type Sector % NAV Investment date Description Exit strategy Phu My OTC Transport & Logistics 3.4% Sep-08 Developer and owner of the Phu My BOT Bridge, the first cable-stayed bridge in Ho Chi Minh City, and the connecting roads. Seek exit via trade sale. CII Listed General Infrastructure 3.2% Nov-09 An investment company with focus on infrastructure assets including water treatment, toll road, industrial parks. Sell equity stake when VN Index recovers. MIS PE Telecom 2.6% Mar-08 JSC specialised in BTS building and leasing, based in Hanoi. VNI holds 75%. Consolidate into wholly owned BTS portfolio company and exit through trade sale or listing. 24

25 VNI pipeline (next six months) BTS portfolio Additional acquisitions of new BTS companies and In-building system (IBS) companies in Vietnam to fold into a Singapore holding company. Potential exit to a strategic partner. Deep sea bulk cargo port/logistics project Negotiating with one of the top four agricultural commodity traders in the world. 25

26 VNI strategy for Strategic shift Beginning 2011, we revisited our strategy and shifted focus toward pre-listing assets, and agriculture and real estate-related infrastructure projects: Aligns our strategy closer with VinaCapital s core strengths in pre-ipo and RE sectors. Pre-listing assets would provide a quicker value appreciation. Infra-related agribusiness is a high growth sector, in high demand. We have also adopted an integrated approach: Combining CM and PE into an integrated portfolio approach. Strategy is to improve sector/asset class coverage and allocation of funds to optimise liquidity. Involves two main functions: Portfolio Management and Sector Coverage. Action Plan Deploy rest of the cash to OTC/PIPE/Pre-IPO/distressed assets for quicker value appreciation. Aggressively rebalancing listed portfolio to take advantage of current low market cycle. Broaden scope to include infra-related agribusiness (plantations, logistics, bulk cargo ports). Accelerate development of existing industrial parks. Execute good exits for at least 3 existing assets. Resolve issues at three troubled assets: MIDC, Vietstar, Phu My Bridge. 26

27 VinaLand Limited (VNL) 27

28 VNL overview Background NAV vs share price performance (31 May 11) Inception: March 2006 USD687m NAV (31 Mar 11) USD1.37 NAV per share USD1.61 high watermark Investing highlights 37 assets in the portfolio. Residential sales of USD21 million during Q (2010: USD73.8 million) Mar- 06 Sep- 06 Mar- 07 Sep- 07 Mar- 08 Sep- 08 Mar- 09 Sep- 09 Mar- 10 Sep NAV 0.84 SP Mar- 11 Performance highlights 41.7% increase in NAV/share since inception. 2.3% 2010 (-9.2%) 2009 (due to unrealised writedowns) 17.1% % 2007 Share price discount 38.7% at end-may 2011, down from over 70% during March Investor sentiment has not recovered from 2008 low. Exits continue to demonstrate validity of VNL s NAV. Only 10% debt across entire portfolio. 28

29 VNL assets exited at significant premium to NAV Divestment history (to June 2010) Total and partial realisations: 7 Acquisition costs (USD 000) 115,308 Full realisations 126,420 Partial realisations 77,473 Total realised 203,893 Value created per share (i.e. profits for VNL) USD % +127% +41% +58% Quoc Te Oasis Hilton Hanoi Opera Sale Price Central Garden NAV at Exit Mandarin Garden Cam Ranh Resort Hanoi Golden Westlake 29

30 Exit track record (1) Opal Investment date: July 2006 Ownership: VNL75%/VOF25% of 70% VNL investment: USD33.1 million IRR after tax: 22% Investment rationale: Semi-distressed asset Opportunity to renegotiate Hilton management agreement and improve operations, cut costs Exit rationale: Well-run hotel, requiring cap ex of USD15m. Received high unsolicited offers; sold at 27% premium to the international offers received. Magnolia Investment date: August 2007 Ownership: VNL 100% VNL investment: USD18.8 million IRR after tax: 53% Investment rationale: Land swap of a small city-centre site for a larger plot in the future second CBD of Hanoi. Exit rationale: Achieved master planning approval and on-sold to a Vietnamese developer at a high valuation. Completed in FY

31 Exit track record (2) Heather Investment date: March 2007 Ownership: VNL 100% for 189 apartments VNL investment: USD15.0 million IRR after tax: 48% Investment rationale: Deep discount from distressed developer Added value through product development and marketing Strong alignment of interest through profit sharing structure Exit rationale: Retail sales exit, completed sales. Investment date: June 2006 Camellia Ownership: VNL 100% of 56 apartments VNL investment: USD7.7 million IRR after tax: 15% Investment rationale: Discounted purchase of completed stock from distressed developer. Exit rationale: Retail sales in improved market during

32 Exit track record (3) Investment date: Q Ownership: VNL 73.26% Orchid VNL investment: USD13.7 million IRR after tax: 22% Investment rationale: District 7, main arterial road leading to Saigon South. Good retail exposure. Exit rationale: JV partner developing adjoining land was discounting price, affected our feasibility study. Stalling on application process. Exit in 2009 with Investment Licence received. Investment date: Q Ownership: VNL 100% Chrome VNL investment: USD1.9 million IRR after tax: 10% Investment rationale: Private beach concept in new resort area, close to new airport. Exit rationale: Project too small for VNL mandate. Exited in Q

33 Exit track record (4) Pending exits: Sale of partial equity stake in CBD mixed-use development, HCM City. Sale of full stake in office/hotel development, HCM City. Investment date: April 2007 Ownership: VNL 100% Lavender VNL investment: USD5.6 million IRR after tax: 27% Investment rationale: District 9 residential project near infrastructure rollout Exit rationale: Access issues surfaced after acquisition. Pending supply surplus in the vicinity. Approached by VOF investee company wanting vertical integration of their business in HCM City Operating hotel exits in early stages of negotiation. 33

34 Portfolio breakdown Portfolio by sector (Mar 2011) 100% 80% 60% 21.9% 17.3% 5.0% Office 3 assets 1 operating asset Mixed-use/retail 8 assets 1 project under development Geographic breakdown 7.8% Hanoi region 40% 20% 17.2% 38.6% Residential 6 assets 1 project under development 27.0% Central provinces 0% by sector (%) Hospitality 13 assets 9 operating assets Township 38.6% Residential 17.2% Office/retail 5% Mixed use 17.3% Townships (large scale) 7 assets 3 projects under development 65.2% HCM City region Hospitality 21.9% 34

35 NAV movement, Q4-10 to Q VNL net asset value movement, Q Q NAV 688,157 NAV 686, Management fees Upward valuations Downward valuations Tax provisions Working capital Opening Closing Closing Upward valuations Tax provisions Opening Q Management fees Downward valuations Movement in working capital Note: Opening figure is original unaudited NAV. Closing figure incorporates revisions as a result of the interim review performed by Grant Thornton. 35

36 Top ten investments by NAV Total NAV of top 10 investments: USD466 million (approx. 62% of total portfolio NAV)* No Investment Location in Vietnam Development type Site area (ha) NAV% Current NAV (USDm) Value increase since acquisition (%) Current status 1 Cambridge South Mixed-use 30 11% 83m 84% Planning underway 2 Niagara Centre Mixed-use % 73m 159% Construction and sales underway 3 Jupiter South Township 200 9% 67m 23% Construction and sales underway 4 Nile South Mixed-use 3.1 6% 44m 71% Planning underway 5 Mekong South Mixed-use 1.4 6% 44m 194% Land compensation underway 6 Tiber North Mixed-use 4.0 5% 35m 35% Construction underway 7 Venus Centre Township 158 5% 35m 13% Construction and sales underway 8 Aquarius South Township 250 5% 34m -24% Planning underway 9 Mars South Residential 32 4% 27m 0% Planning underway 10 Leo South Township 126 3% 23m 130% Planning underway (*) Note: The valuation of each project is determined following the VNL valuation policy. Pertinent details of this policy include: Assets are held at cost until they receive an investment licence or certificate of business. Assets with an investment licence or a certificate of business are assigned a fair value that is determined by procuring two valuations from independent property valuation consultants. All assets in the portfolio with an investment licence or certificate of business are revalued at least once yearly. All assets are subject to desktop reviews or independent appraisals if there is evidence of impairment. The primary factors in determining the value of each project include total investment costs, with adjustments for 1) Shareholder loans (if any) 2) Gain/(loss) on acquisition cost 3) Acquisition-related costs written off (IFRS 3) 4) Fair value adjustment 5) Deferred tax asset/liability 6) Working capital at project company 36

37 Projects carried at cost (31 Mar 2011) Total NAV of projects retained at cost (pending master planning and investment licence approval): USD68 million No. Investment Location Type Site Area 1 Mars South Residential 33ha 2 Gemini Centre Township 1,538ha 3 Chrome South Hospitality 10ha 4 Lily South Residential 20ha 5 Libra South Township 1,935ha 6 Jasmine South Residential 5ha 7 Jade South Hospitality 238ha 37

38 Cambridge Township, HCM City Project summary: Type Location Area Legal Status Mixed-use residential and retail. District 2, Ho Chi Minh City. Site Area: 30ha. Estimated GFA: 570,000sq.m. Cleared and fully compensated site. Investment Licence application was submitted in Dec Masterplan submitted and awaiting approval. Project background In January 2008, the HCM City People Committee granted the site to the project company. The land was fully compensated and cleared. The project will build and transfer 4,200 resettlement apartment units in Binh Khanh site at investment cost. Investment Licence submitted, pending approval. Mid-range housing project developed in conjunction with municipal government. Project update 1:500 Masterplan awaiting approval prior to securing financing for development of the first phase of residential development. The second phase being the retail component. Excellent location in District 2, HCM City, with major infrastructure now under construction including freeway to District 1 (approx min by car). 38

39 Niagara Mixed-use (resort) Project summary: Type Location Area Development update Integrated resort with golf courses, hotel, retail centre including recreational amenities, resort residences (villas and condominiums) and supporting facilities. Danang, Central Vietnam (10km from international airport). Site area: 260ha. Phases 1-6: estimated GFA of 250,000sq.m. Legal Status Cleared site, under development. Investment Licence received Dec Construction permit received for villa phases 1-3 and condominium block. 1:500 revised Masterplan approved Investment Strategy Integrated residential development with resort facility situated on the beach with panoramic views of surrounding mountains, pristine beaches and the golf course. Ground breaking in Jan The first 18-hole golf course now fully operational (opened in April 2010). Beach Clubhouse opened in Aug 2011; golf clubhouse opened in Mar Phase 1-2 villas handed over to owners. Villa rental pool is operational. Construction on new villa phases underway. Display villas open. High-end branded Norman Estate villas launched sales on 5 June The Cham Condominium tower block A superstructure completed. Vietnam s first truly integrated, world-class resort community. Features a golf course listed as one of top 15 new courses in the world by golf.com. Sales update Phases 1-3 villas, totaling 115 villas and beach houses, have been launched with 92% sold to date. Condominium tower has 41 units in first block, 40% sold to date, official launch in Apr First seven (of 33) branded luxury villas now pre-sold. 39

40 Jupiter Township Project summary: Type Location Area Township (integrated residential). Dong Nai Province, near HCM City. Site area: 200ha. Approved GFA: 1,758,975sq.m. Legal Status Investment Licence received in May 2007 Land Use Rights issued for all zones, except for Zone 8 and CBD. 1:500 Master plan and construction permit for Zone 5 received. Investment Strategy Development of six zones over period of 5-7 years and early partial divestment to co-investor. Development update ZONE 5 Construction and sales of Zone 5 townhouses underway. Total of 332 villas, ground floor concrete slabs 60% complete. Show village opened in Mar Sales update Released 232 out of 332 villas in soft launch, 123 villas sold to date. Zone 5 officially launched in early Apr Market has slowed, therefore implemented land lot sale strategy on Phase 4 lots only. Unique island township in fast-growing suburban region. 40

41 Nile Mixed-use Project summary: Type Location Area Total units Mixed-use residential, retail, office and hotel. District 10, HCM City. Site area: 3.1ha. Estimated GFA: 278,748sq.m Over 1,200 apartments. Legal Status Factory to relocate during Investment Licence received Oct :500 Master plan approved Oct Investment Strategy Commence residential apartments first and seek co-investor and major tenants for retail/office space. A landmark development in central HCM City. Development update Relocation of the factory in progress. Site clearance underway. Expected key milestones: Construction (residential) Q3 2011; Sales launch Q4 2011; Completion

42 Tiber Mixed-use Project summary: Type Location Area Legal Status Investment Strategy Mixed-use residential, retail, hotel and office. Hanoi 40,000sq.m. Estimated GFA: 351,140sq.m. Investment Licence received May 2008 and revised IL received Feb Planning Approval No.763/QHKT-P1 dated 17 Mar 2010 from Hanoi Department of Planning and architecture Seeking co-investment to develop the office and retail. Development update Ground breaking in Dec Commencement of structural piling in Q Commencement of basement construction in Q Landmark development in strategic new urban centre in western Hanoi 42

43 Venus Township Project summary: Type Township. Location Area Nha Trang City, Khanh Hoa Province. Site Area: 158ha. Estimated GFA: 962,982sq.m. Legal Status Investment approval in Investment Licence and construction permit obtained. Investment Strategy Development of infrastructure and residential components to commence first. Seeking partial divestment to co-investor for remaining phases. Development update Infrastructure design completed. Display village under construction (completion due Sept 2011). Site being filled and leveled. Five-unit display village to open in September The first modern township in Nha Trang a fast-growing coastal resort city. Sales update Soft sales launches in Hanoi and HCM City in Dec To date, 587 lots reserved out of 638 released. Official launch planned for Sept 2011 under VinaLiving brand. 43

44 We remain bullish on this exciting market Vietnam s urban landscape is low-rise and over-crowded. 86m population in m urban dwellers 100m population in m urban dwellers 44

45 VinaCapital 17 th Floor, Sun Wah Tower 115 Nguyen Hue, District 1, Ho Chi Minh City, Vietnam P: (84 8) F: (84 8) Website: Ho Chi Minh City Hanoi Danang Nha Trang Phnom Penh Singapore 45