20-July-2020: Platinum Asia Investments (PAI) June 2020 Quarterly Report
PAI returned 7.0% for the quarter and 14.6% for the year. After a volatile start to the year, it was an exciting quarter for PAI, which was well positioned for a market recovery after weathering the steep sell-off earlier in the year.
In Brief:
- Global equity markets staged an extraordinary rally over the quarter despite the global economy only just starting to recover from the depths of the largest economic setback in modern economic history.
- After a volatile start to the year, it was an exciting quarter for PAI, which was well positioned for a market recovery after weathering the steep sell-off earlier in the year.
- Stocks in PAI are predominantly strong Asian companies that we believe will likely be resilient in an obviously difficult environment. Reliance Industries (+55%), LG Chem (+61%) and Sea Ltd (+96%) were key contributors to performance. Stocks benefiting from a recovery in Chinese domestic tourism also performed well, including China International Travel Service (+129%) and Huazhu (+22%).
- Starting valuations are a key determinant of future returns. Asian stocks are currently trading on low valuations versus their long-term averages - and economic prospects for the region are favourable.
- Our bottom-up process is hard at work, generating numerous prospective ideas. It is an exciting time for investors like us, as attractive valuations coincide with significant capacity for further policy stimulus in Asia.
- PAI will continue to deploy capital in attractive and strong businesses that are under-appreciated by the markets.
--- click on the link above for the full June Quarter Report from PAI ---
[I hold PAI shares]