This rating reflects Vingroup's good real estate business and the good performance of the shopping center system.
Real estate sales of Vingroup are forecasted to continue to increase sharply in the next three to five years thanks to the prospect of macroeconomic growth in Vietnam.
Fitch Ratings estimates that Vingroup will have US$3 billion revenue in 2017 and in 2018, this figure will be US$3.5 billion. In the first half of 2017, Vingroup's revenue was US$1.5 billion.
Most of Vingroup's current revenue comes from high-level villas and apartments under the Vinhomes brand name but it is forecasted that VinCity products, mid-level real estate, will make up a large proportion of revenue in the future.
Fitch also estimated that Vingroup had the stable financial situation, which based on the figures at the end of 2016. However, the situation may deteriorate rapidly if the company expands its business activities more aggressively than expected.
Vingroup operates in Vietnam which has higher risk of macroeconomic environment than Indonesia and China. Compared with other economies, the real estate market in Vietnam is in a new stage of development, starting in 2015 after a sharp recession for many years.
Demand for real estate is supported by new regulations that allow foreigners to own property. Fitch believes that the proportion of real estate sales in Vietnam is higher than that of Indonesia and China. This can lead to the sales fluctuations during the economic downturn.