While it has become much trickier to find undervalued companies to invest in today, investors can still find opportunities in high quality companies that are going through hiccups.
Paul Danes, Asia portfolio manager at Martin Currie, said the firm invested in two companies in Korea that are going through some hiccups.
One of them was faced with product quality issue, while the other was bought over, he said, adding that these minor hiccups had sent the share price of these high quality companies down.
Additionally, Martin Currie has also bought some consumer names in Indonesia, given that some of the retail names in Indonesia are on valuations that’s almost halved where they were two to three years ago.
Danes said it’s trickier to specify which markets or sectors to find undervalued stocks today, given that valuations are the highest they’ve been post financial crisis.
‘Rather than having big overweight on certain countries and big underweight on certain sectors, we are finding we really got to look into very specific individual companies’ ideas.’
He said it is easy for Martin Currie to position its portfolio a year ago, given that North Asia offers ample opportunities in terms of stocks with cheap valuations.
Chinese tech companies, Korean semiconductor companies and Taiwanese hardware companies, for example, were doing very well and were the cheapest a year ago, he added.