Structural Transformation of Vietnam's Stock Market

Vietnam's securities market is evolving beyond a simple economic indicator into a core driver of national growth. The government's goal to increase market capitalization from the current 50% of GDP to 100-120% by 2030 carries significance far beyond mere numbers.

Le Anh Tuan, Director of Investment at Dragon Capital, emphasized that "if Vietnam wants true growth momentum, the securities market must become the foundation for long-term capital mobilization and reflect the operational capacity of the entire economy."

Core Strategy for Financial Market Restructuring

Moving away from a bank-centric financial structure is central to this transformation. Vietnam's economy currently relies heavily on short-term bank credit. The government is developing the corporate bond market alongside equities to shift toward medium and long-term capital mobilization channels.

The plan is to expand the corporate bond market from its current 11% of GDP to 20%. A balanced capital market system of stocks, bonds, and credit is expected to become essential for Vietnam's economy to develop with an innovation focus and better respond to external shocks.

Restoring Investor Confidence Is Key

From 2018 to 2023, Vietnam's stock market recorded approximately $10 billion in net foreign capital outflows. The pandemic, an incomplete legal environment, and defensive investor sentiment were the main causes.

However, signs of reversal in capital flows are emerging in 2025. Vo Nguyen Khoa Tuan, Director of Securities at Dragon Capital, pointed to three key factors:

1. High GDP growth rate (possibility of reaching double digits)
2. Attractive market valuation (price-to-earnings ratio of 11.6x)
3. Stable macroeconomic management and consistent institutional reforms

Dang Ngoc Minh, Director of Research at Dragon Capital, stressed that "without trust in legal stability and investor protection mechanisms, long-term capital will not flow in" and "institutional, corporate, and domestic investor cooperation is needed for sustainable capital return."

Growth Potential and Conditions

If GDP maintains double-digit growth from 2025 to 2030, corporate profits are likely to increase by an average of 25-30% annually. This would provide the foundation for market indices to grow 2-5 times.

However, experts agree that such growth must stem from companies' intrinsic capabilities, transparent governance, and sound market mechanisms to be sustainable. This means establishing a market culture centered on long-term value investing rather than short-term speculation is essential.

Future Outlook [AI Analysis]

The prospects for Vietnam's securities market to succeed in its structural transformation appear promising. Positive factors are converging, including clear government targets, signs of foreign investment returning, and macroeconomic stability.

However, two conditions must be met. First, institutional reforms that enhance investor protection and market transparency must continue. Second, qualitative improvements in listed companies and expansion of market depth must proceed in parallel.

As Vietnam breaks through the middle-income trap and enters a sustainable growth path, the role of the capital market is expected to become increasingly important.