Key Facts and Summary from the Report:
Financial Year and Date of the Report:
- The report is for the financial year ending 30 June 2024.
- The report date is 20 September 2024.
Performance Overview:
- For the 12-month period ending 30 June 2024, the fund’s net asset value (NAV) dropped by 2.82% in SGD terms, while the benchmark SSE 50 Index fell by 1.02%.
- The fund’s performance over various time frames:
- 3 months: 0.36% growth
- 6 months: 3.65% growth
- 1 year: -2.82% decline.
Top Holdings as of 30 June 2024:
- The top holdings included Kweichow Moutai Co Ltd (13.33% of total net assets), Ping An Insurance Group (6.41%), and China Merchants Bank (6.09%).
Market Outlook:
- The fund remains optimistic about China’s A-shares but notes several key risks:
- China’s real estate recovery remains uncertain, and further easing measures are necessary to support the sector.
- Key investment themes include state-owned enterprises with strong cash flows and dividend yields, as well as artificial intelligence within China’s supply chain.
Dividends:
- The report did not explicitly mention any dividends for this financial year.
Actions to Improve Profitability:
- The report mentioned that Chinese companies are being encouraged to focus on shareholder returns through raising dividends and share buybacks, which could attract more investors and enhance return on equity (ROE).
Recommendations for Investors:
If You Are Holding the Stock:
- Hold: The market outlook is cautiously optimistic, especially for sectors like state-owned enterprises and artificial intelligence. However, the uncertain macroeconomic conditions, especially related to the real estate sector, warrant a patient approach. The fund’s strategy to focus on dividend-paying stocks may offer stability.
If You Are Not Holding the Stock:
- Consider Buying: The fund’s focus on state-owned enterprises with strong cash flows and its positioning in emerging themes like artificial intelligence make it an appealing long-term investment. However, be mindful of short-term volatility due to external risks such as China’s economic recovery and geopolitical factors.
Special Notes for Investors:
- The market is particularly focused on how China’s property sector and macroeconomic recovery will unfold. There are risks related to geopolitics and the global interest rate environment.
- Investors should monitor China’s easing measures and policies closely, as they will play a significant role in the fund’s future performance.
Disclaimer:
This recommendation is based solely on the data provided in the report. Market conditions can change, and it is essential to conduct additional research or consult with a financial advisor before making investment decisions. The performance of the fund in the past does not guarantee future results.
