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Crouching tiger: the contrarian case for China

16 June 2023 |
Active ESG
In our latest video insight, Sandy Pei, Portfolio Manager, China Equity, talks about the stuttering rebound from the end of zero-Covid, the explosive growth of the EV sector and renewables, and the opportunities created by SOE reform.
  • Following the end of zero-Covid, China is in the midst of a U-shaped rather than V-shaped recovery, which has been quite uneven across various sectors.
  • Electric vehicle (EV) sales as percentage of new auto sales in China increased to 35% in 2022 and China is now a net exporter of cars. The Chinese EV sector now commands 60-70% of the global market and a lot of the EV supply chain is based in China.
  • State-owned enterprises (SOEs) in China, such as telcos and utilities, have been trading at a significant discount to private companies and corporate governance reforms are making them a much more compelling investment.

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