Diverse and

Growing
Markets


ABOUT THE STRATEGY

Strg Asia
Mount Everest, highest peak in Asia (Nepal)

Asia's investment landscape is ripe with opportunity, powered by a confluence of factors driving unprecedented growth across the region. The rapid ascent of household wealth is creating a burgeoning middle class, while advanced manufacturing capabilities have transformed the region into a global powerhouse for production.

Within this vibrant ecosystem, our Asian equity strategy looks to gain exposure to a diverse range of sectors poised for expansion—from cutting-edge technology to infrastructure, healthcare to consumption, and beyond.

KEY FEATURES OF ASIA

Economic Powerhouse

Asia represents over 40% of global GDP and is home to some of the world’s fastest-growing economies.

Thriving Consumer MarkeT

With a population exceeding 4.7 billion people across diverse cultures and a rapidly expanding middle class, Asia presents a massive and ever-growing consumer market for businesses
to tap into.

Technological Innovation Hub

Asia is at the forefront of technological advancements, with leading companies in areas like e-commerce, fintech, and renewable energy driving innovation and shaping the future.

Rising Investment Destination

The region attracts substantial foreign direct investment, reflecting growing confidence in its economic prospects and potential for high returns.

Diverse Opportunities

From more established economies like China, Taiwan, and South Korea to emerging powerhouses like India and Indonesia, Asia offers a wide spectrum of investment opportunities across various sectors and countries.

ASIA – HOME TO
MULTIBAGGERS

Asia is a breeding ground for multibagger opportunities thanks to its high nominal GDP growth, which has given rise to meaningful consumer cohorts and new product categories. This growth, coupled with a well-educated and enterprising talent pool, has led to a new generation of visionary entrepreneurs who are seizing opportunities and driving change. 

At the helm of these companies are management teams with exceptional vision, thought leadership, and strong execution skills, capable of converting promise into reality. While inefficiencies in market coverage pose challenges, they also present unique opportunities for disciplined, on-the-ground stock pickers to identify exceptional companies.

India and China are key drivers of multibaggers in Asia

Asia Map 1
Source: FactSet alpha tester, Jefferies, March 2024; Note: Companies with market cap and ADTO more than US$50mn and US$0.5mn at the start. Multibaggers are stocks that have tripled (+200%) while outperforming local market index in 5 years.

Healthcare and tech have a strong hit rate of multibaggers

Asia Map
Source: FactSet alpha tester, Jefferies, May 2024; Note: Data excludes China A-shares. Companies with market cap and ADTO more than US$50mn and US$0.5mn at the start. Multibaggers are stocks that have tripled (+200%) while outperforming local market index in 5 years.

Navigating Asia’s
Complexities

Navigating Asia’s Complexities

Notwithstanding the exciting opportunities, investing in Asia’s dynamic markets presents its own challenges due to the complexities of political landscapes and corporate governance structures. Factors such as regulatory changes, policy shifts, and varying levels of transparency can significantly impact investment outcomes. This is where the expertise of a seasoned and disciplined active manager becomes critical. 

At Shikhara, we strive to have a deep understanding of the local markets, cultural nuances, and on-the-ground research capabilities in Asia. This enables us to effectively navigate the region’s complexities and identify companies with strong fundamentals and winning business models. In a region as diverse and dynamic as Asia, we believe active management provides investors with the potential to unlock long-term value and achieve their financial goals.

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