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Marco europe april 2010 Marco europe april 2010 Presentation Transcript

  • Asia, 2010: The Year of the Stock Picker Marco Giubin Portfolio Manager & Head of Research Citywire Fund Selector Vienna, 13 th April 2010
  • Presenter Marco Giubin Senior Portfolio Manager, Head of Asia Pacific Research & Investment 14 years investment experience, 14 years working experience Marco Giubin joined Mirae Asset Global Investments (HK) in May 2006 as a portfolio manager and was promoted to Head of Research in April 2009. Marco is currently responsible for managing our key Asia-Pacific sector leader funds and supervising the regional model portfolio. Prior to joining Mirae Asset, Macro was the Head of Asian Consumer Sector Research at Fidelity Investments in Hong Kong. He joined Fidelity in 1999 as an analyst and covered numerous sectors during that period. Marco started his investment career in 1996 with UBS where he was an analyst covering Australian mining companies. Marco holds a Bachelor of Business from the University of Technology, Sydney (Australia).
  • About Mirae Asset Global Investments
    • Building on principles
    • The Mirae Asset Financial Group is an independent financial services firm engaged in various areas of finance, including asset management, investment banking and life insurance. We aim to become a true leader in the world’s capital markets by offering our clients a full range of products and services, while always operating according to our basic tenet of “Building on Principles”
    Mirae Asset Financial Group Mirae Asset Global Investments Group
    • Traditional Long Only Equity Investment
    • Fixed Income
    • Alternative Investments
    Mirae Asset Capital
    • Financial consulting and corporate finance services
    Mirae Asset Financial Group Mirae Asset Securities
    • Investment Banking
    • Wealth Management
    • Brokerage Services
    Mirae Asset Life Insurance
    • Life Insurance
    • Variable Insurance
    • Retirement Pension
  • 1997 Established Mirae Asset Global Investments 1998 Launched Korea’s first mutual investment fund 1999 Established Mirae Asset Securities 2001 Selected as external manager of the National Pension Service (NPS) of Korea 2003 Opened first global operation in Hong Kong 2005 Established Mirae Asset Life Insurance 2005 Launched Korea’s first overseas investment (ex. Korea) fund 2006 Listed in the Korean Stock Exchange (Mirae Asset Securities) 2008 Launched SICAV Luxembourg-domiciled funds 2008 Received QFII* license from the China Securities Regulatory Commission
    • QFII: Qualified Foreign Institutional Investor
    Our history
  • Hong Kong Korea U.S.A Brazil Vietnam China India U.K
    • Asset Management: Hong Kong, India, Brazil, Vietnam, China, U.K, U.S, and Korea
    • Securities: Hong Kong, Brazil, China, Vietnam, U.K, U.S, and Korea
    • Life Insurance: Korea
    • Capital and other affiliates: Korea
    Our global presence
  • Breakdown of AUM by Fund Type
    • Total assets under management (AUM): USD 58.7 billion
    • Assets invested in emerging market equities : USD 37.4 billion*
    Regional Breakdown of Equity Investment (ex. Korea) * Breakdown of AUM by Client Type
    • Updated as of December 2009
    • Figures displayed with a single star (*) refer to Korea-domiciled funds only
    • Source: AMAK (Asset Management Association of Korea), Mirae Asset
    Assets under management (overview)
  • Sustainable Competitiveness or Franchise Value We apply fundamental bottom-up analyses to each investment opportunity to assess intrinsic value and future potential Long Term Time Horizon We look through short term noise in understanding the company’s true long term potential Risk Management We consider risk before return when making investment decisions. Our stringent compliance program also minimizes unnecessary risk Team-based Approach We place a strong emphasis on communication between investment professionals in generating investment ideas around the globe
    • Investment Philosophy
    • We firmly adhere to our philosophy of “Building on principles” throughout the investment process. By following the fundamental principles of investing in intrinsic value, managing risk effectively and applying contrarian principles, we are able to generate consistently solid returns for our clients.
    For professional investors only. Not for distribution to the public. Our investment principles
  • Investment Process (Flow Chart)
    • In-house Research
          • In-house research: company visits, on the ground research and cross-channel checks to generate high conviction stock
          • ideas
    Step 1.
    • Ideas Exchange
          • Exchange and cross-analyses of stock
          • ideas between various sector and
          • country teams via weekly meetings
    Step 2.
    • Portfolio Construction
    • Analysts construct model portfolios
    • Research Head monitors MPs
    • Portfolio Manager takes investment decisions and constructs portfolio
    Step 3.
    • Risk Management
    • Performance review
    • Risk management activity
    • Overall compliance check-up
    Step 4. For professional investors only. Not for distribution to the public. Investment process
    • Model Portfolios
    • Each analyst constructs a Model Portfolio for their sector. The AP ex-Japan regional MP is an aggregation of the MPs of each of our sector analysts. It is designed to show-case the best of the research team’s long-term investment ideas. It is monitored and maintained by the Research Head.
    • Actual Portfolios
    • Portfolio Managers have ultimate discretion when choosing stocks for their portfolios as they are held accountable for performance. PMs and analysts work closely together and real portfolios tend to have high overlap with MPs.
    • Investment Universe
    • The AP Investment Universe assists portfolio managers in avoiding unnecessary exposure to stocks classified as excessively risky. All existing benchmark stocks are included in the IU and some non-IU stocks subject to risk and compliance monitoring.
    • .
    1 2 3 For professional investors only. Not for distribution to the public. Investment process
    • All teams conduct vigorous company visits and research trips.
    • Ensure all relevant aspects of a stock are covered and explored in team discussions.
    Sector Teams Country Teams
    • The above numbers may include overlap in research/management positions
    • Figures displayed within parentheses refer to those assigned in operations out of HK
    • Data as of 31 Jan 2010
    For professional investors only. Not for distribution to the public. Investment team Matrix coverage of countries and sectors China India AP Regional EMEA Latin America Global Index Total Consumer 2 Financial 2 Properties 2 Industrial 2 Resources 1 IT 1 Total 6 1 + (7) 8 (2) (5) 6 + (2)
  • The Investment Outlook for Asia Pacific
  • Asia: Economic growth remains strong
    • GDP growth
    Source: Merrill Lynch, data as of 9 Feb 2010.
    • Resilient domestic consumption, government investments and export recovery support growth
  • Asia: Healthy financial balances Source: CEIC, BofA Merrill Lynch Global Research estimates, data as 10 Feb 2010. “ PIIGS” -4.9 6.2 Asian Average -3.1 7.8 China -4.3 10.7 Hong Kong -11.8 -2.2 India -2.3 0.9 Indonesia -3.2 3.4 Korea -7.8 13.4 Malaysia -3.9 3.2 Philippines -2.1 12.6 Singapore -4.9 7.9 Taiwan -5.8 4.9 Thailand -7.2 -5.4 Spain -14.5 -11.2 Greece -4.5 -3.5 Italy -14.7 -3.0 Ireland -7.7 -9.6 Portugal Fiscal Balance (% of GDP) Current Account Balance (% of GDP) Country
    • 2008 Gross domestic saving (as % of GDP)
    Asia: Private consumption Source: UBS, data as of 14 Aug 2009. % Source: CEIC data, CLSA Asia-Pacific markets, data as of 10 Feb 2010. Asia ex-Japan private consumption
    • Domestic consumption is key investment theme for Asia for years to come
    • We prefer consumer discretionary and selected financials
  • China: A massive consumption boom Source: BCA Research January, 2010 China US Retail sales in US dollar terms The mega cycle of consumption wave Source: BCA Research, data as of 10 Feb 2010. China US Retail sales in US dollar terms
  • China: Pre-emptive credit tightening Source: BCA Research, data as of 10 Feb 2010.
    • Concerns on China’s credit tightening is overdone
    • Domestic demand to remain firm
  • Asia: “V”-shape recovery in exports Source: CEIC, BofA Merrill Lynch Global Research estimates, data as 10 Feb 2010. China export growth Asian export growth
    • Positive for technology sector
  • Asian equities: Valuation
    • Price-to-book ratio
    Price-to-earnings ratio Source: Credit Suisse estimates, data as of 9 Feb 2010.
    • Markets going through a correction now, after a strong year in 2009
    Multiples (x) Source: Credit Suisse estimates, data as of 9 Feb 2010. Multiples (x)
  • Asian equities: Re-rating
    • Return on equity
    Source: Credit Suisse, data as of 10 Feb 2010.
    • Improvements in Return on Shareholder’s Equity (ROE) while gearing is falling = more efficient use of capital => re-rating is justified
    Leverage
  • Asian equities: Positive earnings revisions likely
  • Investment strategy OW = Overweight UW = Underweight N = Neutral
  • Technology sector: recovery in 2010 Source: Company data, Credit Suisse, data as of 17 Feb 2010. Global tech aggregate inventory - low US business investment in technology – under recovery
  • Some of our Favourite Stock Picks
  • Stock example: Hon Hai precision (2317 TT) Source: Gartner, Credit Suisse, data as of 17 Feb 2010. Global PC shipment - strong Hon Hai: sales breakdown by product Market share – smartphones
    • P/E: 13.6x 2010; 5 year EPS CAGR: 18.0%.
    • Largest electronic manufacturing services company in the world
    • Strong management with consistent track record over past decades
    • Beneficiary of recovery in the global IT cycle
  • Stock example: Acer Inc (2353 TT) Source: Gartner, data as of 17 Feb 2010. Sales breakdown Global market share
    • P/E = 15x 2010; 5 year EPS CAGR = >10%
    • Acer has been gaining market share consistently
  • Stock example: Tencent (700 HK) Source: Gartner, Credit Suisse, data as of 17 Feb 2010. Instant messaging users - China Market share – instant messaging in China Market share – internet game revenue in China Number of users in China
  • Stock example: Tencent (700 HK) Source: Factset, data as of 26 Mar 2010. Tencent – price chart HK$
    • P/E: 32.5x 2010; 5 year EPS CAGR: 38.5%
    • Dominant internet conglomerate in China with close to 80% market share in instant messaging and a strong user community
    • Company has been able to tap into its dominant IM platform to launch value-added ancillary services
    • Online gaming is another growth driver
    • “ Winner takes all” position in China, the largest internet market in the world
  • Stock example: Li Ning (2331 HK) Source: Deutsche Bank Securities, data as of 17 Feb 2010. Market share in China Market share in China (2008) Net profit Operating margin
  • Stock example: Li Ning (2331 HK) Source: Factset, data as of 26 Mar 2010. Li Ning – price chart HK$
    • P/E: 20.7x 2010; 5 year EPS CAGR: 35.6%
    • Largest home-grown sports brand in China
    • Strong brand name as the founder, Li Ning, was one of the best known Olympic medalists in China since the 80’s
    • Moving into multi-brand strategy in recent years
  • Stock example: China Merchants Bank (3968 HK) Source: Citigroup, CLSA, data as of 18 Feb 2010. *As of Q3 ’09 **As of 2008 Non-performing loan Non-performing loan ratio Source: Company data, data as of 18 Feb 2010. Peer group comparisons 21.2% 23.0% 2.8% 2.6% CMB 19.8% 8.4% 4.4% 4.0% BOCOM 17.7% 13.3% 11.4% 10.7% BOC 22.7% 15.8% 11.3% 13.0% CCB 21.7% 33% 13.5% 16.3% ICBC Credit card** Loans* Deposits* 2010 ROE Market share
  • Stock example: China Merchants Banks (3968 HK) Source: Factset, data as of 26 Mar 2010. China Merchants Bank – price chart HK$
    • P/E: 13.9x 2010; 5 year EPS CAGR: 45.0%
    • Sixth largest bank in China, with ample room to gain market share
    • Top quality management
    • Focus on consumer segments, not SOE lending
    • Most leveraged to rate hikes
  • Stock example: JB Hi-Fi (JBH AU) Source: Macquarie Securities, data as of 17 Feb 2010. Same store sales growth Store rollout by geography EBIT margin Market share of addressable market 15 12 14 14 13
  • Stock example: JB Hi-Fi (JBH AU) Source: Factset, data as of 26 Mar 2010. JBH – price chart A$
    • P/E: 18x FY Jun 2010; 5 year EPS CAGR: 34.6%
    • Rapidly growing consumer electronics retail chain in Australia due to strong management – on way to become a dominant player
    • Higher than industry same store sales growth
    • Low cost, versatile store format
  • Stock example: Keppel Corp (KEP SP) Source: Company data, Morgan Stanley, Mirae Asset, data as of 18 Feb 2010. Valuation Singapore property prices
  • Stock example: Keppel Corp (KEP SP) Source: Factset, data as of 26 Mar 2010. Keppel Corp – price chart S$
    • P/E: 12.7x 2010; 5 year EPS CAGR: 23.2%
    • Globally dominant company in the oil rig building industry, which has a duopolistic structure
    • Exposure to infrastructure and property businesses
    • Order flow to recover to 2007 level but valuation is still behind
    • Cheaper than its peers
  • Appendix: Mirae Asset SICAV sub-funds
    • Mirae Asset China Sector Leader Equity Fund
    • Fund overview
    +5.30% +9.90% Benchmark : MSCI China refers to MSCI China (Gross), which includes dividend/income reinvestment. Source: Mirae Asset Global Investments (HK) as of Feb 28, 2010. All performance numbers are net of fees, NAV to NAV, in USD with dividend reinvested. The fund performance information is based on CLASS I which is for professional or qualified investors only. The returns may not the same as class A which is for retail investors. The fund inception date was on 22 July 2008 whilst Class I (USD) was launched on 2 Sept 2008. Fund Performance (%) The fund has been authorized by HK SFC on June 26, 2009 and authorization does not imply official recommendation Name Mirae Asset China Sector Leader Equity Fund Objective The fund aims to achieve long-term growth by investing mainly in equities and equity related securities of sector leading companies domiciled in or exercising a large portion of their economic activity in China (limited to B-shares) and Hong Kong . Launch Date (Class I USD) 2 Sept 2008 Fund Manager & Location Cong Li, Hong Kong Fund Domicile Luxembourg Total AUM (as of Feb 28, 2010) USD 22.63 Million Benchmark MSCI China Index Fund Structure Open-ended mutual fund Fund base Currency USD Bloomberg Code MIRCSLU LX ISIN code LU0336296644 Custodian Citibank International plc (Luxembourg branch) Returns (%) 3 mths 6 mths 1 year Since Launch Fund -6.07% 6.80% 72.62% 5.30% Benchmark -6.20% 7.08% 71.02% 9.90% Returns (%) Since Launch to Dec 2008 CY 2009 2010 YTD Fund -32.50% 67.56% -6.90% Benchmark -27.63% 62.63% -6.63%
  • Mirae Asset China Sector Leader Equity Fund Allocation information Source: Mirae Asset Global Investments (HK) internal data as of Jan 31, 2010. Due to rounding, the sum of portfolio may not equal 100% Sector weightings The fund has been authorized by HK SFC on June 26, 2009 and authorization does not imply official recommendation Sector Fund Benchmark Difference Financials 32.09% 37.31% -5.22% IT 18.14% 5.85% 12.28% Consumer Staples 10.78% 4.50% 6.28% Energy 9.34% 17.32% -7.98% Industrials 8.74% 8.46% 0.29% Materials 6.23% 5.83% 0.40% Consumer Discretionary 6.21% 5.18% 1.03% Health Care 2.95% 0.25% 2.70% Utilities 2.43% 2.09% 0.34% Telecom 0.00% 13.21% -13.21% Cash / Liquidity 3.09% 0.00% 3.09%
  • Mirae Asset China Sector Leader Equity Fund Allocation information Source: Mirae Asset Global Investments (HK) internal data as of Jan 31, 2010. Due to rounding, the sum of portfolio may not equal 100% Market capitalization The fund has been authorized by HK SFC on June 26, 2009 and authorization does not imply official recommendation Market Cap. No. of Securities in Portfolio Portfolio Weighting Benchmark Weighting Difference <Total Equity> 34 96.91% 100.00% -3.09% Large Cap > USD 1 bn 32 93.14% 99.43% -6.29% Mid Cap 2 3.76% 0.57% 3.20% Small Cap < USD 0.5 bn   0.00% 0.00% 0.00% Cash / Liquidity   3.09% 0.00% 3.09% Total 34 100.00% 100.00% --
  • Mirae Asset China Sector Leader Equity Fund Holding Information Source: Mirae Asset Global Investments (HK) internal data as of Jan 31, 2010 The fund has been authorized by HK SFC on June 26, 2009 and authorization does not imply official recommendation Holding Portfolio Benchmark Difference Sector   Weighting Weighting     China Life Insurance Co. Ltd. (China) 8.20% 6.22% 1.99% Financials Tencent Holdings Ltd. 6.60% 3.18% 3.43% IT China Merchants Bank Co. Ltd 'H' 5.20% 1.51% 3.69% Financials Ping An Insurance (Group) Co. of China Ltd. 5.10% 1.88% 3.22% Financials China Pacific Insurance (Group) Co. Ltd. 4.47% 0.53% 3.94% Financials China Shenhua Energy Co. Ltd. 4.01% 2.60% 1.41% Energy China BlueChemical Ltd. 3.78% 0.21% 3.58% Materials ZTE CORP H 3.31% 0.37% 2.94% IT Parkson Retail Group Ltd. 3.25% 0.41% 2.84% Consumer Discretionary PetroChina Co. Ltd. 3.10% 4.48% -1.38% Energy
  • *Standard & Poor’s as of Sept 2009 **© 2010 Morningstar TM, Inc. All Rights Reserved. Morningstar Rating TM as of Feb 2010. The Morningstar rating is based on CLASS I, which is for professional or qualified investors only. The rating may be not the same as Class A, which is for retail investor. Mirae Asset Korea Equity Fund Fund overview +34.40% +10.80% Benchmark : Benchmark refers to KOSPI index, which exclude dividend/income reinvestment. Source: Mirae Asset Global Investments (HK) as of Feb 28, 2010. All performance numbers are net of fees, NAV to NAV, in USD with dividend reinvested. The fund performance information is based on CLASS I which is for professional or qualified investors only. The returns may not the same as class A which is for retail investors. The fund inception date was on 22 July 2008 whilst Class I (USD) was launched on 2 Sept 2008. Note: Exchange rate we use for the Benchmark is from Bloomberg The fund has been authorized by HK SFC on June 26, 2009 and authorization does not imply official recommendation Fund Performance (%) Name Mirae Asset Korea Equity Fund Objective The fund aims to achieve long-term growth by investing mainly in equities and equity related securities of companies domiciled in or exercising a large portion of their economic activity in Korea Launch Date (Class I USD) 2 Sept 2008 Fund Manager & Location Sung Woo Kim, Korea Fund Domicile Luxembourg Total AUM (as of Feb 28, 2010) USD 26.19 Million Benchmark KOSPI Index Fund Structure Open-ended mutual fund Fund base Currency USD Bloomberg Code MIRKOEU LX ISIN code LU0336295596 Custodian Citibank International plc (Luxembourg branch) S&P Fund Rating A* Morningstar (Five Star ratings)** (Class I USD & EUR) Returns (%) 3 mths 6 mths 1 year Since Launch Fund 2.75% 7.95% 96.20% 34.40% Benchmark 3.49% 8.33% 99.16% 10.80% Returns (%) Since Launch to Dec 2008 CY 2009 2010 YTD Fund -14.50% 64.80% -4.61% Benchmark -30.33% 66.49% -4.47%
  • Mirae Asset Korea Equity Fund Allocation information Sector weightings Source: Mirae Asset Global Investments (HK) internal data as of Jan 31, 2009. Due to rounding, the sum of portfolio may not equal 100% The fund has been authorized by HK SFC on June 26, 2009 and authorization does not imply official recommendation Note: Sector weighting based on holding basis Sector Fund Benchmark Difference Industrials 22.96% 18.46% 4.49% Materials 20.28% 13.68% 6.60% IT 20.17% 21.82% -1.66% Consumer Discretionary 9.98% 12.99% -3.01% Financials 9.50% 16.07% -6.57% Telecom 3.93% 4.13% -0.20% Utilities 2.77% 3.84% -1.07% Consumer Staples 1.87% 5.30% -3.43% Energy 1.39% 2.52% -1.13% Health Care 0.59% 1.18% -0.60% Cash / Liquidity 6.58% 0.00% 6.58%
  • Mirae Asset Korea Equity Fund Allocation information Market capitalization Source: Mirae Asset Global Investments (HK) internal data as of Jan 31, 2010. Due to rounding, the sum of portfolio may not equal to 100% The fund has been authorized by HK SFC on June 26, 2009 and authorization does not imply official recommendation Market Cap. No. of Securities in Portfolio Portfolio Weighting Benchmark Weighting Difference <Total Equity> 41 93.42% 100.00% -6.58% Large Cap > USD 1 bn 35 84.18% 90.35% -6.16% Mid Cap 6 9.24% 3.72% 5.51% Small Cap < USD 0.5 bn   0.00% 5.93% -5.93% Cash / Liquidity   6.58% 0.00% 6.58% Total 41 100.00% 100.00% --
  • Mirae Asset Korea Equity Fund Holding information Source: Mirae Asset Global Investments (HK) internal data as of Jan 31, 2010. The fund has been authorized by HK SFC on June 26, 2009 and authorization does not imply official recommendation Note: Stock weighting based on holding basis Holding Portfolio Benchmark Difference Sector   Weighting Weighting     Samsung Electronics Co. Ltd. 8.97% 14.72% -5.75% IT LG Chem Ltd. 6.84% 1.69% 5.15% Materials POSCO 5.99% 5.96% 0.03% Materials Honam Petrochemical Corp. 4.07% 0.46% 3.61% Materials Samsung Electro-Mechanics Co. Ltd. 3.84% 0.93% 2.92% IT LS Corp. 3.77% 0.39% 3.38% Industrials KCC Corp. 3.47% 0.46% 3.02% Industrials SK C&C Co. Ltd. 3.27% 0.00% 3.27% IT Hyundai Engineering & Construction Co. Ltd. 2.96% 0.91% 2.05% Industrials Korea Electric Power Corp. 2.77% 3.14% -0.36% Utilities
    • Thank you
    Important Information: This document is for professional investors only and has been prepared for presentation, illustration and discussion purpose only and is not legally binding. The provision of this document does not constitute or form part of any offer to issue or sell, or any solicitation of any offer to subscribe or purchase any shares nor shall it or the fact of its distribution form the basis of, or be relied on in connection with, any contract thereof. Any investment in the Mirae Asset Global Discovery SICAV should only be made on the basis of an Offering Memorandum accompanied by the current Prospectus and Simplified Prospectus approved by the CSSF. No shares of the SICAV may be directly or indirectly offered or sold to nationals or residents of the United States of America. The tax treatment relating to the holding, acquisition or disposal of shares in the fund depend on each investor’s tax status or treatment and may be subject to change. Any potential investor is strongly encouraged to see advice from its own tax advisors. Past performance is no guarantee of future results. An investment in the Mirae Asset Global Discovery SICAV carries risks, which are described in the Prospectus and the Simplified Prospectus. The price of shares of the Fund can go down as well as up and investors may not get back the full amount invested. Currency fluctuations may affect the value of overseas investment. Where a fund invests in emerging markets, this investment can be more risky than an investment in developed markets. Investors are reminded of the concentration risks and volatility associated with sector focused funds. This presentation is issued in the United Kingdom and Europe by Mirae Asset Global Investments (UK) Limited, which is authorised and regulated by the Financial Services Authority. The Mirae Asset Global Discovery SICAV is not regulated by the FSA. All or some of the protections provided by the UK Regulatory System may not apply to Mirae Asset Global Discovery SICAV investors. Please seek professional advice before deciding to invest.