Three Asian tech stocks that lead the way in innovation
Professional investor Fay Ren of Cerno Capital highlights three of her favourite Asian tech stocks to buy now
My personal take on the opportunities within Asia is based on companies that can achieve leading positions in either their home markets, or regionally and globally. The Asian consumption story is well known but the new facet is the growth in commercialisation of home-grown intellectual property. The perception of Asian companies as copycats and consumers of Western innovation is now outdated. So a portfolio of Asian shares should extend beyond traditional consumption themes. Asian companies are climbing up the value chain, disrupting Western oligopolies and beginning to lead industry trends.
Taiwan’s leading-edge chipmaker
TSMC (Taipei: 2330) is the world’s leading semiconductor foundry, based in Taiwan. It is one of the very few players capable of producing the leading-edge microchips used in high-performance electronics and is well placed to capitalise on structural demand arising from digitisation, 5G and artificial intelligence. The outlook is positive: revenues are growing at 20% a year and the company will invest US$100bn in producing advanced microchips over the next three years.
The story of the semiconductor fabrication industry is one of consolidation. As the technological challenges and the costs of improving processing power have mounted, even Intel, historically at the forefront, has been struggling. This leaves just two Asian players standing, with TSMC leading in logic chips and Samsung Electronics in memory chips.
Subscribe to 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
Nidec (Tokyo: 6594) is a Japanese company that manufactures half of the world’s brushless direct current (DC) motors. The company has built its leading position via research and development over 50 years on delivering ever smaller, more powerful motors with superior energy-efficiency. It enjoys scale advantages and breadth in its end-markets, supplying sectors ranging from drones to robots and industrial machinery. It is now leveraging the same skill set into traction motors required for the global electric-vehicle (EV) market.
Nidec is targeting a 40%-45% share in a market with huge potential as the demand for EVs explodes, with new players entering the market including Apple and Xiaomi. Nidec’s strength as the core supplier of critical components allows it to benefit from the overall growth of the market.
Entertaining Gen Z
Bilibili (Hong Kong: 9626) is China’s go-to online entertainment platform targeting Generation Z, with over 200 million active users. It is a unique blend of Youtube, Twitch and Netflix, featuring user-generated content, live-streaming, e-sport hosting, and professional video productions.
It stands out among its countless peers, preserving a distinctive quirky identity thanks to its anime, comic and gaming (ACG) heritage. A community experience is cultivated through innovative interactions, encouraging high user engagement and retention. It also consciously curates an ecosystem supporting quality content and content-makers that will sustain creativity in the long run.
Businesses are increasingly turning to Bilibili to connect with China’s youth. The platform is expanding at an annual rate of over 70% with multi-faceted revenue streams; key areas include gaming, advertising and e-commerce.
Sign up for MoneyWeek's newsletters
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.
Fay Ren is a co-manager of the TM Cerno Pacific fund.
-
What happens if you can’t pay your tax bill, and what is "Time to Pay"?
Millions are due to file their tax return this Friday as the self-assessment deadline closes. Though the nightmare is not over until you pay the taxman what you owe - or face a penalty. But what happens if you can't afford to pay HMRC your tax bill, and what is "Time to Pay"?
By Kalpana Fitzpatrick Published
-
What does Rachel Reeves’s plan for growth mean for UK investors?
Rachel Reeves says she is going “further and faster” to kickstart the UK economy, but investors are unlikely to be persuaded
By Katie Williams Published
-
How to find quality and profitability in financial companies
Opinion Julian Cane, manager of the CT UK Capital & Income Trust, picks three financial companies that drive cash flow, dividends and asset value
By Julian Cane Published
-
Luxury stocks rally after Richemont sales boom – is there hope for the sector?
Cartier owner Richemont’s robust results have boosted sentiment about luxury stocks – but are investors getting carried away?
By Dr Matthew Partridge Published
-
Transformed companies displaying momentum and top-quality growth
Alex Savvides, manager of Jupiter UK Dynamic Equity Fund, highlights three companies as he tells us where he'd put his money
By Alex Savvides Published
-
Should you add Straumann Holding to your portfolio?
Straumann Holding is a global leader in the premium dental-care market
By Rupert Hargreaves Published
-
What’s the outlook for the shipping industry in 2025?
All we know for certain about the year ahead is that it will be volatile. But the container shipping sector thrives on choppy waters
By Rupert Hargreaves Published
-
How to find top-quality companies with sustainable and growing dividends
Ian Mortimer, portfolio manager of Guinness Global Equity Income Fund, shares where he would put his money for sustainable and growing dividends
By Ian Mortimer Published
-
Why Wise could be worth a lot more than its share price implies
Foreign-exchange transfer service Wise has the potential to become the Amazon of its sector – here's why you should consider buying this stock now
By Jamie Ward Published
-
Can The Gym Group pump up your portfolio?
Gym Group was one of the best UK small-cap stocks in 2024 and will beef up your profits this New Year
By Rupert Hargreaves Published