Thai corporates healthiest, Vietnam sees biggest increase in investment

April 24, 2017

HONG KONG - ASEAN corporate health is sound thanks to low leverage and healthy revenue generation, despite heavy reliance on short-term funding and high interest rates, according to the latest Natixis ASEAN Corporate Monitor, which covers about 1,200 listed non-financial institutions in the region and compares them with a similar universe globally.

The Natixis debt and revenue growth metrics show that ASEAN corporates are generally healthy and should prove resilient in the face of external shocks.

Thai corporates are healthiest, while Vietnamese ones are the worst in terms of debt dynamics. But Vietnamese corporates’ bet on CAPEX, by far the largest, bodes well for the future as long as the demand is there to support their growth.

At the sector level, ASEAN is more exposed to domestic-oriented industries. Natixis says these sectors, especially renewable and environment, airlines and utilities, also perform best in ASEAN economies.

“In turn, ASEAN corporates in externally exposed sectors performed worst, which goes hand in hand with the weak global conditions they experienced in 2016.

“More specifically, compared with their global peers, ASEAN corporates underperform in the infrastructure, industrial and high-tech (semi-conductor) sectors.” www.natixis.com (ATI).