Susie Rippingall was born in 1966. She graduated from the University of Edinburgh with a degree in economics in 1988, before working at Credit Lyonnais Securities and Western Asset Management. In 1995, she joined First State Investment Management, where she was junior manager of the Scottish Oriental Smaller Companies Trust between 1995 and 2000. She was lead manager of the trust between November 2000 and her retirement in April 2013.
What was her strategy?
Rippingall focused mostly on smaller Asian companies, believing that the illiquid and under-researched nature of many Asian markets meant that small firms tend to trade at a discount to their real value. She looked for good-quality businesses with decent growth prospects that traded at reasonable valuations. She placed considerable emphasis on meeting management and getting to understand the business. The trust’s portfolio typically included around 80 investments, of which a large number were small stakes that might be increased over time as she became more comfortable with them.
Did this work?
During her near-13-year tenure, the Scottish Oriental Smaller Companies Trust delivered an average annual return of 24%. This was much higher than the MSCI Emerging Market index, which returned about 12% a year in sterling terms, and the MSCI Asia ex Japan index, which produced about 10% per year.
What were her biggest successes?
Rippingall held many stocks consistently during her tenure but added or reduced holdings in them depending on valuation, making it hard to identify which made the greatest contribution. Big holdings included several local subsidiaries of the Japanese retail and financial services conglomerate Aeon Group, such as Thailand’s Aeon Thana Sinsap, whose share price more than quadrupled in her last year in charge. The Indian haircare firm Marico, which returned 40% per year between 2004 and 2013, and Hong Kong soft drinks firm Vitasoy, which returned 26% per year, both including dividends, were long-term successes.
What lessons are there for investors?
Investing in small companies in emerging markets can be very profitable, but you need to be able to do a lot of in-depth research, which will be difficult for most private investors. However, the approach of building up an investment over time as you understand the business’s strengths and weaknesses better is one that investors can apply more widely.