LIONGLOBAL SOUTH EAST ASIA FUND

Transcription

1 For the half year ended 30 June (Unaudited) SEMI-ANNUAL REPORT LIONGLOBAL SOUTH EAST ASIA FUND A member of the OCBC Group Lion Global Investors Ltd 65 Chulia Street #18-01 OCBC Centre, Singapore T : F : Co Reg No: D For more information, visit: lionglobalinvestors.com or ContactUs@lionglobalinvestors.com Lion Global Investors Limited. All rights reserved.

2 DIRECTORY Manager Lion Global Investors Limited 65 Chulia Street #18-01 OCBC Centre Singapore Directors of Lion Global Investors Limited Mr Khor Hock Seng (Chairman) Mr Ching Wei Hong (Deputy Chairman) Mr Gerard Lee How Cheng (CEO) Mr Norman Ip Ka Cheung Mr Tan Siew Peng Mr Ronnie Tan Yew Chye Ms Wee Ai Ning Trustee/Registrar HSBC Institutional Trust Services (Singapore) Limited 21 Collyer Quay #13-02 HSBC Building Singapore Custodian The Hongkong and Shanghai Banking Corporation Limited 1 Queen s Road Central, Hong Kong Independent Auditor PricewaterhouseCoopers LLP 7 Straits View, Marina One East Tower, Level 12 Singapore

3 PERFORMANCE OF THE FUND For the half-year ended 30 June Past performance is not necessarily indicative of future performance. Cumulative returns for the Fund are calculated up to 30 June in SGD terms, based on single pricing, with dividends reinvested net of all charges payable upon reinvestment. Time Period Fund Returns (%) LionGlobal South East Asia Benchmark* Returns (%) Fund - SGD Class 3 months months year years** years** years** Since Inception** (23 February 1996) Past performance is not necessarily indicative of future performance. Cumulative returns for the Fund are calculated up to 30 June in USD terms, based on single pricing, with dividends reinvested net of all charges payable upon reinvestment. Time Period Fund Returns (%) LionGlobal South East Asia Benchmark* Returns (%) Fund - USD Class 3 months months year years** years** years** Since Inception** (25 June 2004) Source: Morningstar/Lion Global Investors Ltd * Benchmark: MSCI All Countries Far East Ex Japan: Since inception to 31 December 2005 MSCI Singapore/Malaysia/Philippines/Thailand/Indonesia: From 1 January 2006 to 30 April 2011 MSCI All Countries South East Asia Index: From 1 May 2011 MSCI AC ASEAN Index: From 18 Jan 2017 ** Returns of more than 1 year are annualised. 1

4 REVIEW For the half-year ended 30 June, the Fund declined 7.7%, underperforming the benchmark Morgan Stanley Composite Index (MSCI) AC ASEAN Index which declined 7.7% in SGD terms. Volatility increased in the equity markets in 1st Half due to concerns over interest rate hikes especially by the US Central Bank and strengthening USD against emerging market currencies. The on-going trade tensions between US and her major trading partners also caused jittery in the markets. Our stock selection in the Consumer sector contributed to performance during this period especially Mitra Adiperkasa in Indonesia and Wilcon Depot in Philippines. Mitra Adiperkasa did well due to stronger than expected same-store-sales growth and margins improvement from their restructuring of their department stores while Wilcon Depot continued to deliver on their new store expansion plan. Other contributors included our overweight in the Singapore banks like DBS and UOB which reported better-than-expected earnings on loan growth and improving margins. Detractors from performance mainly came from our holdings in BDO Unibank in Philippines and Bank Tabungan Negara in Indonesia. BDO, being a proxy to the Philippines market, suffered from the weakening peso while Bank Tabungan Negara was sold down on concerns over interest rates hike on its profitability. Our underweight in Public Bank in Malaysia also detracted from performance after the stock held up well. 2

5 STRATEGY AND OUTLOOK As part of our bottom-up stock selection process, we are always looking to invest in quality companies with competitive advantages that are operating in industries or sectors that can benefit from the favourable demographic profile, rising middle class, growing income and urbanization opportunities that ASEAN offers. With continued infrastructure and government spending and expected spill over from the export recovery to domestic demand and consumption in the region, we are also interested in companies that will benefit from these trends. Markets have been challenging so far in 1st Half mainly due to trade wars concerns, higher interest rates and USD and general risk aversion from emerging markets. While these are external risks to the outlook of ASEAN economies, fundamentals in ASEAN such as FX reserves, external debt level and current account deficit, have largely improved since As a result, the economies are better placed to withstand these external concerns. However, we recognized that volatility and flows will continue to impact the ASEAN markets which we are monitoring closely. Valuations are now less demanding after the market correction with ASEAN trading below its historical PE average of 15x. We are taking the opportunities created by the increased volatility to increase our exposure to companies that are more domestic focused especially domestic consumer companies that should be more resilient and less impacted by external factors. The key risks remain a) peaking global growth; b) china policy risks; c) faster than expected inflation leading to higher interest rates; d) trade wars and protectionism. As of 30 June 3

6 DISCLOSURES ON THE FUND 1 For the half year ended 30 June (Unaudited) 1. DISTRIBUTION OF INVESTMENTS AS AT 30 JUNE Percentage of total net assets attributable to Fair Value unitholders $ % a) By Asset Class Equities 14,533, Cash and other net assets 473, Net assets attributable to unitholders 15,007, b) By Credit Rating of Debt Securities Not applicable c) By Derivative Type Not applicable The total net realised losses from financial derivatives at the end of the period was $2, As required by the Code on Collective Investment Schemes 4

7 2. TOP 10 HOLDINGS As at 30 June Percentage of total net assets attributable to Fair Value unitholders $ % DBS Group Holdings Limited 1,424, United Overseas Bank Limited 1,030, Singapore Telecommunications Limited 505, PT Bank Central Asia Tbk 482, CP ALL Public Company Limited - NVDR 408, Airports of Thailand Public Company Limited - NVDR 383, Kasikornbank Public Company Limited - Foreign 348, Tenaga Nasional Berhad 338, PTT Public Company Limited - NVDR 337, PT Telekomunikasi Indonesia Tbk 336, As at 30 June 2017 Percentage of total net assets attributable to Fair Value unitholders $ % United Overseas Bank Limited 1,269, DBS Group Holdings Limited 954, Singapore Telecommunications Limited 748, PT Bank Central Asia Tbk 572, PT Telekomunikasi Indonesia Tbk 489, PT Astra International Tbk 476, PT Bank Rakyat Indonesia (Persero) Tbk 440, Genting Berhad 398, Kasikornbank Public Company Limited - Foreign 372, Singapore Exchange Limited 363,

8 3. RELATED PARTY TRANSACTIONS For the period from 1 January to 30 June Brokerage on purchases and sales of investments charged by the ultimate holding company of the Manager 84 Interest income earned from a bank which is a related company of the Trustee 347 Transaction fees charged by the Trustee 5,637 Registration fee charged by a related company of the Trustee 9,087 Valuation and administration fees charged by the Trustee 3,689 Custodian fees charged by a related company of the Trustee 5,176 Bank service fees charged by a bank which is a related company of the Trustee 115 Cash transfer fees charged by a related company of the Trustee 4,191 Cash and bank balances placed with a financial institution related to the Trustee as at 30 June were amounted to $560,797. $ 4. FINANCIAL RATIOS Expense ratio 1 30 June 30 June 2017 % % - SGD/USD class Grandfathered class Turnover ratio The expense ratio has been computed based on the guidelines laid down by the Investment Management Association of Singapore ( IMAS ). The calculation of the expense ratio at 30 June was based on total operating expenses divided by the average net asset value for the year. The total operating expenses do not include (where applicable) brokerage and other transactions costs, performance fee, interest expense, distribution paid out to unitholders, foreign exchange gains/losses, front or back end loads arising from the purchase or sale of other funds and tax deducted at source or arising out of income received. The Fund does not pay any performance fee. The average net asset value is based on the daily balances. 6

9 Total operating expenses and average net asset value are as below: Total operating expenses (annualised in accordance with IMAS) 30 June 30 June 2017 % % - SGD/USD class $269,533 $268,829 - Grandfathered class $46,111 $48,772 Average net asset value - SGD/USD class $13,280,900 $12,965,667 - Grandfathered class $3,020,321 $3,100,491 2 The portfolio turnover ratio is calculated in accordance with the formula stated in the Code on Collective Investment Schemes. The calculation of the portfolio turnover ratio was based on the lower of the total value of purchases or sales of the underlying investments, being purchases of $1,533,920 (30 June 2017: purchases of $2,937,443) divided by the weighted average daily net asset value of $16,538,410 (30 June 2017: $16,238,736). 5. GLOBAL EXPOSURE The global exposure relating to derivative instruments is calculated using the commitment approach by converting the derivative positions into equivalent positions in the underlying assets embedded in those derivatives. The global exposure of the Fund to financial derivative instruments or embedded financial derivative instruments will not exceed 100% of the net asset value of the Fund at any time. 6. COLLATERAL Nil 7. SECURITIES LENDING OR REPURCHASE TRANSACTIONS Nil 8. INVESTMENT IN OTHER UNIT TRUSTS, MUTUAL FUNDS AND COLLECTIVE INVESTMENT SCHEMES Percentage of total net assets attributable to Fair Value unitholders $ % Ascendas Real Estate Investment Trust 237, Frasers Logistics & Industrial Trust 139,

10 9. BORROWINGS Nil 10. SOFT DOLLAR COMMISSION RECEIVED BY THE MANAGERS The soft dollar commissions if applicable from various brokers for the period were utilised on research and advisory services, economic and political analyses, portfolio analyses, market analyses, data and quotation analyses and computer hardware and software used for and in support of the investment process of fund managers. Goods and services received were for the benefit of the scheme and there was no churning of trades.these brokers also execute trades for other funds managed by the managers. The trades are conducted on best available terms and in accordance with best practices. 11. OTHER MATERIAL INFORMATION There is no other material information that will adversely impact the valuation of the Fund. 12. SUPPLEMENTAL INFORMATION ON UNDERLYING SUB-FUNDS Not applicable 8

11 STATEMENT OF TOTAL RETURN For the half year ended 30 June (Unaudited) For the half year ended 30 June For the half year ended 30 June 2017 $ $ Income Dividends 304, ,747 Interest on cash and bank balances , ,827 Less: Expenses Audit fee 7,191 7,611 Custodian fees 5,176 4,895 Management fee 115, ,059 Professional fee 9,870 6,675 Registration fee 9,087 8,166 Transaction cost 18,294 33,517 Trustee fee 4,099 4,027 Valuation and administration fees 3,689 3,624 Miscellaneous expenses 10,783 9, , ,022 Net income 120,989 75,805 Net gains or losses on value of investments and financial derivatives Net (losses)/gains on investments (1,352,495) 1,410,278 Net losses on foreign exchange spot contracts (2,750) (7,179) Net foreign exchange gains/(losses) 5,469 (3,730) (1,349,776) 1,399,369 Total (deficit)/return for the period before income tax (1,228,787) 1,475,174 Less: Income tax (22,403) (23,582) Total (deficit)/return for the period (1,251,190) 1,451,592 9

12 STATEMENT OF FINANCIAL POSITION As at 30 June (Unaudited) As at 30 June As at 31 December 2017 $ $ ASSETS Portfolio of investments 14,533,428 15,978,926 Receivables 45,198 39,926 Due from broker 30, ,839 Cash and bank balances 560, ,900 Total assets 15,169,576 16,971,591 LIABILITIES Payables 116, ,753 Due to broker 45, Total liabilities 162, ,581 EQUITY Net assets attributable to unitholders 15,007,417 16,856,010 10

13 STATEMENT OF MOVEMENTS OF UNITHOLDERS FUNDS For the half year ended 30 June (Unaudited) 30 June 31 December 2017 $ $ Net assets attributable to unitholders at the beginning of the financial period/year 16,856,010 15,630,540 Operations Change in net assets attributable to unitholders resulting from operations (1,251,190) 2,861,944 Unitholders contributions/(withdrawals) Creation of units 1,451,914 2,158,461 Cancellation of units (2,049,317) (3,794,935) Change in net assets attributable to unitholders resulting from net creation and cancellation of units (597,403) (1,636,474) Distributions - - Total (decrease)/increase in net assets attributable to unitholders (1,848,593) 1,225,470 Net assets attributable to unitholders at the end of the financial period/year 15,007,417 16,856,010 11

14 STATEMENT OF PORTFOLIO As at 30 June (Unaudited) By Geography (Primary) Holdings at 30 June Percentage of total net assets attributable to Fair value at unitholders at 30 June 30 June $ % QUOTED EQUITIES SINGAPORE DBS Group Holdings Limited 53,539 1,424, United Overseas Bank Limited 38,508 1,030, Singapore Telecommunications Limited 164, , UOL Group Limited 34, , Ascendas Real Estate Investment Trust 89, , Keppel Corporation Limited 28, , City Developments Limited 16, , Genting Singapore PLC 142, , CapitaLand Limited 51, , Frasers Logistics & Industrial Trust 133, , SATS Limited 23, , Singapore Exchange Limited 16, , Singapore Technologies Engineering Limited 31, , ComfortDelGro Corporation Limited 44, , Jardine Cycle & Carriage Limited 2,000 63, ,826,

15 Holdings at 30 June Percentage of total net assets attributable to Fair value at unitholders at 30 June 30 June $ % THAILAND CP ALL Public Company Limited - NVDR 135, , Airports of Thailand Public Company Limited - NVDR 147, , Kasikornbank Public Company Limited - Foreign 42, , PTT Public Company Limited - NVDR 171, , Indorama Ventures Public Company Limited - NVDR 132, , Advanced Information Service Public Company Limited - NVDR 31, , PTT Exploration & Production Public Company Limited - NVDR 28, , Banpu Public Company Limited- NVDR 153, , Krung Thai Bank Public Company Limited - NVDR 155, , Netbay Public Company Limited - NVDR 71, , TMB Bank Public Company Limited - NVDR 1,024,600 96, Siam Commercial Bank Public Company Limited - NVDR 18,600 90, PTT Global Chemical Public Company Limited - NVDR 28,900 86, Central Pattana Public Company Limited - NVDR 27,400 78, Synergetic Auto Performance Company Limited - NVDR 339,460 76, Srisawad Corporation Public Company Limited - NVDR 57,100 69, Rich Sport Public Company Limited - NVDR 258,500 52, ,061,

16 Holdings at 30 June Percentage of total net assets attributable to Fair value at unitholders at 30 June 30 June $ % INDONESIA PT Bank Central Asia Tbk 236, , PT Telekomunikasi Indonesia Tbk 944, , PT Bank Mandiri (Persero) Tbk 513, , PT Bank Rakyat Indonesia (Persero) Tbk 1,201, , PT Astra International Tbk 291, , PT Mitra Adiperkasa Tbk 2,088, , PT United Tractors Tbk 57, , PT Indofood CBP Sukses Makmur Tbk 158, , PT Indocement Tunggal Prakarsa Tbk 77, , PT Semen Indonesia (Persero) Tbk 138,600 93, PT Bank Tabungan Negara Tbk 377,100 87, PT XL Axiata Tbk 355,500 85, ,516, MALAYSIA Tenaga Nasional Berhad 68, , Malayan Banking Berhad 110, , CIMB Group Holdings Berhad 175, , Genting Berhad 100, , Genting Malaysia Berhad 130, , Public Bank Berhad 26, , RHB Bank Berhad 102, , Axiata Group Berhad 100, , Alliance Bank Malaysia Berhad 77, , MyNews Holdings Berhad 147,600 79, Gamuda Berhad 58,900 65, British American Tobacco Berhad 5,100 59, Sime Darby Property Berhad 56,904 23, Sime Darby Berhad 16,604 13, ,373,

17 Holdings at 30 June Percentage of total net assets attributable to Fair value at unitholders at 30 June 30 June $ % PHILIPPINES Ayala Land Inc 271, , Banco de Oro Unibank Inc 81, , Macroasia Corporation 396, , Ayala Corporation 8, , Metropolitan Bank & Trust Company 76, , Wilcon Depot Inc 454, , Metro Pacific Investment Corporation 1,097, , GT Capital Holdings Inc 4,275 99, Megaworld Corporation 768,100 83, Robinsons Retail Holdings Inc 37,240 75, Shakeys Pizza Asia Ventures Inc 193,611 60, SM Investments Corporation 2,080 46, ,756, UNQUOTED EQUITIES MALAYSIA RHB Capital Berhad** 141, Portfolio of investments 14,533, Other net assets 473, Net assets attributable to unitholders 15,007, ** This security has been delisted from the stock exchange prior to current financial period and the fair value represents the Manager s best estimate. 15

18 By Geography (Summary) Percentage of total net assets attributable to unitholders at 30 June 31 December 2017 % % Singapore Thailand Indonesia Malaysia Philippines Portfolio of investments Other net assets Net assets attributable to unitholders

19 By Industry (Secondary) Fair value at 30 June Percentage of total net assets attributable to unitholders at 30 June 31 December 2017 $ % % Financial 6,517, Real Estate 1,431, Consumer, Cyclical 1,368, Industrial 1,362, Communications 1,294, Energy 797, Consumer, Non-cyclical 738, Basic Materials 579, Utilities 338, Technology 103, Portfolio of investments 14,533, Other net assets 473, Net assets attributable to unitholders 15,007,

20 DISCLAIMER This publication is for information only. It is not a recommendation, offer or solicitation for the purchase or sale of any securities or investments and does not have regard to your specific investment objectives, financial situation, tax position or needs. Applications for units in our funds must be made on forms accompanying the prospectus. You should read the prospectus and Product Highlights Sheet which is available and may be obtained from Lion Global Investors Limited ( LGI ) or any of its distributors, consider if a fund is suitable for you and seek such advice from a financial adviser if necessary, before deciding whether to invest in the fund. Investments in our funds are not obligations of, deposits in, guaranteed or insured by LGI or any of its affiliates and are subject to investment risks including the possible loss of the principal amount invested. The performance of a fund is not guaranteed and the value of units in a fund and the income accruing to the units, if any, may rise or fall. Past performance, as well as any predictions, projections, or forecasts are not necessarily indicative of the future or likely performance of a fund. Dividend distributions, which may be either out of income and/or capital, are not guaranteed and subject to LGI s discretion. Any such dividend distributions will reduce the available capital for reinvestment and may result in an immediate decrease in the net asset value of the fund. Any information (which includes opinions and estimates) is subject to change or correction at any time without notice and is not to be relied on as advice. You are advised to conduct your own independent assessment and investigation of the relevance, accuracy, adequacy and reliability of any information contained herein and no warranty is given and no liability is accepted for any loss arising directly or indirectly as a result of you acting on such information. The fund may, where permitted by the prospectus, invest in financial derivative instruments for hedging purposes or for the purpose of efficient portfolio management. LGI, its related companies, their directors and/or employees may hold units of a fund and be engaged in purchasing or selling units of a fund for themselves or their clients. Lion Global Investors Limited (UEN/ Registration No D) is a Singapore incorporated company, and is not related to any asset or fund management entity that is domiciled in Europe or the United States. This publication may be translated into the Chinese language. In the event of any ambiguity, discrepancy or omission between the English and Chinese versions, the English version shall apply and prevail. In the event of any ambiguity, discrepancy or omission between this publication and the prospectus, the contents of the prospectus shall apply and prevail.

21 A member of the OCBC Group Lion Global Investors Ltd 65 Chulia Street #18-01 OCBC Centre, Singapore For more information, visit: lionglobalinvestors.com or Co Reg No: D