Tencent Holdings, China Mobile and China Life Insurance Company are among the top 10 positions of the fund.
However, the property sector in China is underweighted.
Yeung was sceptical about China’s troubled state-owned enterprises.
“A lot of SOEs have very attractive assets but some of them are inefficiently managed. The SOE reforms don’t mean that we just go and buy a basket of SOE stocks to play this theme. It is going to be very stock specific.”
Indian consumption
The fund is overweight India and the manager is increasing allocation to companies that can potentially benefit from domestic consumer spending and the increase in state spending on infrastructure projects.
In the financial sector, the fund has a preference for private banks as there are concerns over the rise in non-performing loans in public sector banks.
The HDFC Bank and Housing Development Finance Corp are some holdings in the portfolio.
A critical issue is the ease of doing business in India, which the government aims to address, she said.
“We agree that [Prime Minister Narendra] Modi has this great campaign about ‘Make in India.’ But in order to attract investment from foreigners, you need to see better efficiency in terms of doing business there. That is a key checkpoint that he is looking at.
“Modi has not made any big bang reforms. The government has constantly been reiterating that things take time. From an investor’s perspective, it is a checklist that you just have to keep monitoring.”
