Public investment stocks are emerging as potential safe havens for investors navigating turbulent global economic waters, according to analysts.

 

As infrastructure projects gain momentum, analysts are increasingly optimistic about the role these stocks will play in driving growth and stability.

 

The construction sector, particularly companies involved in public investment, is poised for significant expansion, bolstered by large-scale infrastructure initiatives.

 

Following recent announcements from the US regarding a 46 per cent retaliatory tariff on Vietnamese goods, public investment stocks such as Vinaconex (VCG), Fecon Corporation (FCN), Deo Ca Traffic Infrastructure Investment (HHV), and CIENCO4 Group (C4G) experienced notable declines of 16-26 per cent. 

 

This market reaction, however, has created a substantial gap between current market prices and the target prices set by securities firms, which are now estimated to be lower by 25-36 per cent.

 

On April 10, the stock market rebounded sharply due to a temporary suspension of the US tariffs for 90 days. This news led most stocks to hit their ceiling prices, narrowing the gap between market prices and the valuations expected by analysts.

 

Despite ongoing concerns about the potential long-term impacts of these tariffs, public investment stocks remain a favoured choice for investment this year, alongside banking stocks, irrespective of external economic pressures.

 

Director of Research at Dragon Capital Đặng Nguyệt Minh said that the underlying strength of the domestic economy will mitigate the effects of external shocks.

 

She emphasises that 2025 is set to be a foundational year for a new growth phase, characterised by modernisation and increased transparency in public investment initiatives.

 

In a recent move, the National Assembly approved a plan to increase the proportion of public investment from 6 per cent to 7 per cent of GDP this year.

 

This adjustment raises the total public investment capital to approximately US$36 billion, reflecting a nearly 40 per cent increase from the previous year.

 

In a context where domestic consumption and private sector investment show no significant signs of breakthrough, public investment is becoming the primary driver of economic growth, enhancing overall demand and fostering the development of supporting industries.

 

However, the Ministry of Finance reported that in the first quarter of 2025, public investment disbursement reached just over VNĐ78.7 trillion (US$3 billion), equating to 8.9 per cent of the annual plan and significantly lower than the 11.6 per cent achieved in the same period of 2024.

 

In response, the Prime Minister has urged various ministries to accelerate the disbursement of public investment funds, aiming for 100 per cent of the planned capital by the end of the year.

 

Given the Government’s strong commitment to public investment, Dragon Capital has identified Vinaconex (VCG) as a key stock to watch, along with several firms linked to construction materials, all set to benefit from increased government spending.

 

Hòa Phát Group (HPG) stands out as a prime example, positioned to gain from both the recovery of the real estate market and the surge in public investment.

 

Vietcombank Securities (VCBS) shares this optimistic view, selecting VCG and HHV as promising short-term stocks benefitting from public investment. These firms are confidently setting growth targets for 2025 that align with the broader economic goals of the nation.

 

HHV, for instance, plans to present its business strategy at the upcoming annual general meeting, aiming for revenues of nearly VNĐ3.6 trillion (an 8 per cent increase) and a net profit of VNĐ555.6 billion (a 12 per cent rise from 2024). 

 

The company expects significant revenue from ongoing projects such as the Quảng Ngãi - Hoài Nhơn expressway and several other projects, driven by the Government’s aggressive infrastructure development agenda.

 

Similarly, Vinaconex aims for revenues of VNĐ15.5 trillion, an 18 per cent increase, and a net profit of VNĐ1.2 trillion, an 8 per cent rise, reflecting its confidence in public investment as a growth driver.

 

The company has secured new contracts worth over VNĐ11.6 trillion, positioning itself well for future business activities.

 

Fecon (FCN) is also optimistic, targeting VNĐ5 trillion in consolidated revenue for 2025, representing a 48 per cent increase, and a net profit of VNĐ200 billion, up 565 per cent from 2024. This ambitious outlook is based on large-scale projects across various sectors, including energy and civil construction.

 

While some investors express concerns about potential delays due to administrative adjustments, experts like CEO Lynch Phan of TechProfit suggest that while such changes may cause temporary setbacks, they could ultimately lead to faster and more efficient decision making in public investment. — BIZHUB/VNS

 

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