FTSE Vietnam and MVIS December portfolio rebalancing: Which companies benefit?

In the portfolio of FTSE Vietnam, only PV Drilling & Well Services (HSX: PVD) fell slightly short of meeting the free-float adjusted market capitalisation requirement, putting the stock at risk of removal. The number of constituents of the FTSE Vietnam index may remain unchanged. In case the number of constituents increases, the most likely candidates are Dat Xanh Group (HSX: DXG) and Ho Chi Minh Development Bank (HSX: HDB). All changes will become effective on December 21 or after the closing of business on December 18, stated KB Securities.

Sacombank is expected to benefit from December porfolio rebalancings

MVIS Vietnam Index will likely remain unchanged in the December rebalancing as all constituents met all inclusion requirements during the current review. The number of constituents comprising the MVIS Vietnam index may remain unchanged.

In case the number of constituents increases, the most likely candidates are Saigon Thuong Tin Bank (HSX: STB) and Saigon Hanoi Bank (HSX: SHB). Changes to the MVIS Vietnam Index will take effect on December 21 or after the closing of business on December 18.

KB Securities predicts PetroVietnam Power Corporation (HSX: POW) to benefit the most from the upcoming rebalancing, with an estimated $5.9 million in buying or 3.0 trading days’ worth of stock. FTSE will announce quarterly changes to the FTSE Vietnam index on December 4 and the MVIS Vietnam index will publish changes on December 11.

Moreover, the impact to individual stocks from the December balancing based on the asset under management (AUM) of ETFs benchmarked against both indices. Currently, the AUM of the FTSE Vietnam ETF index sits at $275 million and the VanEck Vectors Vietnam ETF sits at $411 million.

Accordingly, stocks benefitting from additional buying include PetroVietnam Power, Sacombank, Bao Viet Holdings, Vietcombank, and Vietjet. On the other hand, stocks coming under selling pressure include Masan, SSI, Vingroup, Vincom Retail, and Petrolimex.