Shin Yao Ng of Abdon, a Singapore-based Asian equity investment manager, said China looks relatively attractive because Indian stocks are soaring. “I want you to look at the fundamentals: China has a lot of value,” he said in an interview Friday. “But we don't know how long we'll have to wait.” Until China's economy recovers, his strategy is to pick stocks. Official statistics show that China's growth has slowed from the pace of previous decades. Chinese stocks have fallen in recent months, with the Shanghai Composite stock trading near lows not seen since the early months of the pandemic in 2020. All of this follows a year in which growing concerns about China's economy and lack of stimulus kept investors cautious. bystander. Abdon's Ng remains cautious on China, saying the most important indicators are the real estate sector, particularly transaction volume and prices. “Once the situation stabilizes, consumers will feel more confident and households will feel more secure about their financial situation,” he said. But when that will happen remains unclear. Ng does not expect significant stimulus from the government in the coming months. Chinese Premier Li Qiang told a global audience at Davos last week that China “did not rely on large-scale stimulus” and “did not seek short-term growth while accumulating long-term risks.” He showed a restrained attitude. However, Ng said he is focusing on Chinese stocks with high free cash flow yields (a measure of profit potential), especially some internet companies that have announced share buybacks. “There are a lot of stocks in China that give free cash flow yields of +10%,” he said, noting that Indian stocks yield only 1-2%. Abdon is overweight on India and underweight on China as a whole, Ng said. He said the company was selectively pulling out some funds from India after the stock price rose and investing in China and some themed plays. Mr. Abdon's funds include the China A-Share Sustainable Equity Fund, which had $2.4 billion in assets at the end of November. The top 10 holdings include Guizhou Moutai, IRE Eye Hospital, and Mindray. “We are selectively adding items such as sportswear,” Ng said, noting that outdoor activities are becoming more popular in China, supported by Nike and brands owned by Chinese company Anta. He said another area of selective buying is health care stocks. He said he expected companies like Mindray to emerge “stronger” from China's anti-corruption campaign in the sector, while providing a hedge in a growing export business. Ng said one category Abdul has started paying more attention to is some export-oriented stocks, given expectations that the U.S. economy will have a soft landing and create stronger-than-expected demand for Chinese goods. . “I started hearing some voices [industrial] “Names are starting to come up for order recovery, but it could be green shoots,” he said. China's exports grew faster than expected in December, but not enough to make up for the year's decline, marking the first annual decline since 2016. “Asia export statistics released on Friday suggested that Asian exports could increase as early as February. The index rose for the fourth straight month, the highest since May 2022. However, many concerns remain for China's economy as a whole, from geopolitics to an aging population.''While investors and companies hope for large-scale economic stimulus and large-scale economic support, , the government doesn't seem to think the economy needs it,” Ng said. “In times of recession, over-easing is actually needed to get out of it.” A spiral of confidence. ”
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