China’s economic slowdown is creating opportunities for investors in the stock market after valuations fell, Adrian Lim, a senior investment manager at Aberdeen Asset Management Plc said.
“It’s a decent opportunity to accumulate Chinese stocks as most of them have been soft,” Lim, who helps oversee $102 billion in the Asia-Pacific region, said in an interview at Bloomberg’s headquarters in New York yesterday. “The region as a whole remains fundamentally very attractive. There’s still a very fat amount of demand.”
Lim said he remains bullish on Chinese consumer stocks after the firm boosted holdings in Hong Kong-traded shares of PetroChina Co. (PTR:US), the country’s biggest oil producer, and China Mobile Ltd. (CHL:US), the biggest mobile-phone carrier, in the past two years. Aberdeen’s $37 million China Opportunities Fund (GOPAX:US) has gained 3 percent this year, outperforming 89 percent of peers during the same period, according to data compiled by Bloomberg.
The Hang Seng China Enterprises Index (HSCEI) of Chinese companies traded in Hong Kong has slid 5 percent this year as the Chinese economy expanded 8.1 percent in the January-March period, the slowest pace in 11 quarters. The retreat sent valuations of the Hong Kong gauge to 7.9 times reported earnings, the lowest level since October 2011, and below the 10.8 average multiple for companies in the MSCI Emerging Market Index.
The broader Hang Seng Index has added 0.5 percent this year. The Shanghai Composite Index (SHCOMP) of mainland stocks is up 5 percent for the year, following a 22 percent slump in 2011.
“The markets have been nervous about China’s so-called slowdown,” Lim said. “In the context of the developed world, it’s hardly considered a slowdown. It’s more a signal of some caution.”
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