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Asia Dragon Trust PLC on Tuesday reiterated its confidence in Asian equities despite underwhelming performance in the first half of the year. The London-based investor in Asian equity markets said during the half year ended February 29, net asset value total return increased by 1.5%. Asia Dragon therefore underperformed the benchmark MSCI All-Country Asia ex Japan Index which delivered a 3.7% return over the same period. NAV per share, on a capital return basis, fell 0.2% to 420.43 pence per share from 421.26p at August 31. Chair James Will said: ‘Chinese market exposure remained the biggest detractor to performance over this interim period. Investor confidence continued to be very weak with a focus on ’hot’ themes such as artificial intelligence and state-owned enterprise reform instead of stock fundamentals.’ In light of this, the trust’s portfolio has been revised to increase exposure to India, where the company sees tailwinds that are sustaining attractive earnings growth and continued solid economic growth. Looking ahead, Asia Dragon remains confident in the long term potential of Asian equity markets with the trust identifying multiple themes that reinforces its investing strategy. This includes growing momentum in the technology cycle with Asia at the heart of the global technology supply chain. As well as the complexities surrounding the geopolitical landscape which is boosting supply chain diversification in favour of south-east Asian countries. Asia Dragon shares were up 1.0% to 354.64 pence each in London on Tuesday morning. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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