We view Asia as a region of great promise. It is home to China and India, two of the largest economies in the world. The middle class is expanding and developing a growing taste for premium products and services; workforces are becoming more skilled; urbanisation is increasing, along with demand for infrastructure.
The region is also at the forefront of emerging technologies, such as e-commerce, 5G-mobile networks, semiconductors and vehicle electrification. In addition, governments are committing to a lower-carbon future.
Our trust seeks out world-class Asian stocks that will be long-term winners. Aside from being attractively valued, these firms are well run, have good cash flows and solid balance sheets. A sustainable competitive edge is also pivotal, along with appealing industry characteristics. High standards of economic and social governance are key, too. We invest in all three of the following businesses.
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Sending the right signal
Every electronic product has a basic component made by companies such as Taiwan’s Silergy (Taipei: 6415). This component – an analogue integrated circuit (IC) – is what makes computers and mobile phones work. Such ICs can serve as amplifiers, controllers or timers.
Silergy is a leading maker of high-performance analogue ICs. It is rapidly emerging as a key player in analogue IC design, outstripping domestic peers in design, research and development (R&D), patents and experience. Silergy is also benefiting from China’s drive to become self-sufficient in semiconductors. We are impressed by its management’s ability to carry through and we think Silergy has what it takes to capitalise on the transition towards electric vehicles, “the internet of things” and 5G.
Delivering where it counts
Delhivery (Mumbai: DELHIVER) is the largest and only fully integrated logistics player in India. The firm, which was founded in 2011 and listed in 2022, has ensured that more than 1.6 billion shipments ended up in the right hands. Its customer base exceeds 29,000 companies, mainly in e-commerce.
Delhivery’s unique “mesh” network responds dynamically to changes in volumes, shipment profiles and weather conditions; a parcel being delivered from points A to B may take different routes at different times. Its expertise in real-time tracking, data and automation also supports Delhivery’s position as the clear price leader in the core express-parcel business.
Banking on Vietnam’s growth
Vietnam has come a long way since free-market reforms were launched in 1986. Urbanisation, a young, skilled workforce and expanding middle class have driven growth. A burgeoning industrial base also reflects its growing importance in global supply chains.
We see more room for growth, and we like the prospects of Vietnam Technological and Commercial Joint-stock Bank (Ho Chi Minh: TCB) in a market where penetration of financial services remains low. It is the most profitable domestic bank, boasting seasoned management, a solid capital base and a good reputation. It is focusing on retail banking to the well-off and its digital strategies are gaining traction.
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