Three Asian growth stocks to invest in the world's fastest growing markets
Avo Ora of Pictet Asset Management, picks three Asian growth stocks in the world's fastest growing markets and explains why he would put his money in them.

Pictet’s Asia ex-Japan strategy is a long-only, high conviction and fundamentally driven portfolio. We focus on cash-generative businesses and invest in both structural compounders and cyclical-inflection opportunities. Asian equities are attractive due to the strong earning potential of companies and appealing valuations, especially relative to developed markets. A focus on stock selection has been the driver of outperformance and the holding period for each stock is typically three to five years.
Asia remains the fastest-growing region in the world. It is among the most advanced in terms of e-commerce and fintech. The companies below showcase three of the most interesting picks across a variety of sectors.
A key player in renewables
Innovation across the region is on show in the renewable energy sector. Sungrow (Shenzhen: 300274) is a key player in the renewable energy manufacturing chain. It supplies inverters to solar module makers, as well as energy storage solutions (ESS) to solar farm operators. The company is looking to expand its inverter market share from both global and domestic leaders, such as Huawei.
MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Sungrow has benefited from strong tailwinds from global solar farm growth and the accompanying need to capture and store solar energy via its ESS business, as well as from China’s long-term policies of increasing green energy.
We believe current energy prices are likely to accelerate the renewables roll-out. What seem to be high near-term multiples (a forward price/earnings (p/e) ratio of 30 times estimated 2023 earnings) belie the value in the name due to its long-term, structural growth.
A safe play on China’s real-estate rebound
Midea (Shenzhen: 000333) is a white-goods manufacturer whose main product is air conditioners. We believe the company has been unfairly punished due to its exposure to the Chinese real-estate market and, more recently, to rising input costs. However, in our view Midea has managed past surges in input costs (copper) well and will now look to mitigate adverse effects on margins through efficiency gains, price increases and product mix.
We also believe that in order for China to reach its growth targets, it will have to address the real-estate market’s issues tactically and adjust policies so that buyers come back into the market. With Midea’s strong cash flow and net cash position, this should be a safe way to gain exposure to a Chinese property market rebound. At 10.6 times forecast 2023 earnings and a 4.3% dividend yield, it provides both the safety of value and the upside of growth in an otherwise difficult market.
Asia’s best insurer
We view AIA (Hong Kong: 1299) as Asia’s best insurer. A policy of financial liberalisation means there is a strong long-term structural tailwind to growth in the Chinese insurance market. Although the stock has been affected by Covid-19, with the added difficulty of its agents being less able to meet clients in person, we are now seeing the beginning of loosening restrictions in Hong Kong.
Given AIA’s strong presence across Asia, we consider the stock a good way to play an opening up of travel in mainland China and Hong Kong. In addition, valuations should be considered reasonable at 1.7 times 2021 book and 13.5 times earnings.
Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.
Avo Ora is manager of the Pictet Asian Equities ex-Japan fund
-
Could your family be at risk of an unexpected tax bill? How to keep your loved ones in the loop
Many families are out of the loop when it comes to planning the financial aspects of both retirement and inheritance
-
Rightmove: Glut of homes for sale in southern England drives asking price drop
Asking prices are 0.1% lower than a year ago, according to the property website, driven by challenges in affordability-stretched London and the south
-
Small UK industrial stocks are hidden gems
Opinion Ed Wielechowski of the Odyssean Investment Trust highlights three of his favourite British small-cap industrial stocks
-
Aurora Innovation is running on empty – is it overvalued?
Aurora Innovation, a maker of self-driving trucks, may have promised far more than it can deliver
-
'Ride the recovery in emerging markets': Gustavo Medeiros of Ashmore Group tells MoneyWeek
Interview What's the outlook for emerging markets? Gustavo Medeiros, head of research at Ashmore Group, gives his analysis and reviews progress in developing economies
-
What is the Enterprise Investment Scheme and should you have one?
The Enterprise Investment Scheme is tax-efficient and potentially lucrative. Taking a chance on the scheme could trim your family’s IHT bill, says David Prosser
-
The alcohol industry is suffering as consumers sober up – is it still worth investing in the sector?
Changing consumer tastes are rocking the alcohol industry, but the best players are adapting their strategies. Buy them while their shares are still cheap
-
A strange calm in credit
Corporate bond markets remain remarkably relaxed, with yields that offer little compensation for risks
-
'The City's big bet on green finance fails to pay out'
Opinion Insurers and banks are backing away from “green finance”, and there is not much sign of the green boom we were promised. That’s a problem for the City
-
Six top investment trusts for smaller stocks
Liquidity constraints mean investment trusts are best placed to seize the juiciest opportunities