AAIF : Aberdeen Asian Income Fund – performing in line with benchmark
Aberdeen Asian Income Fund’s interim results show AAIF’s NAV returned 3.8% in sterling terms, in line with the MSCI AC Asia Pacific ex Japan Index, which returned 3.9%. The return on the share price was 5.4% reflecting an expansion of the trusts premium to NAV during the period. AAIF reports that performance was driven by stock selection, particularly in Singapore and Australia.
Singapore Post made the largest single positive contribution reflecting the announcement that Alibaba is taking a strategic stake to capitalise on its logistics capabilities within Southeast Asia. Jardine Cycle & Carriage, a recent portfolio addition whose earnings are driven by Astra International, rose on the back of pre-election enthusiasm in Indonesia. Whilst, in Australia, Scentre Group, spun off from the restructure of Westfield Retail Trust and Westfield Group, rose after its market debut in June. Within financial holdings, Australia & New Zealand Banking and Commonwealth Bank of Australia benefited from good interim earnings, which surpassed expectations despite muted demand for credit. An underweight exposure to China and overweight exposure to Thailand also enhanced performance.
During the period Japanese pharmaceutical company Takeda and media group Singapore Press Holdings (SPH) were sold. Takeda faces various challenges including concerns over its drug pipeline and the difficulties of integrating its acquisitions and expanding its presence in emerging markets. For SPH concerns over the prospects of its core newspaper business drove AAIF’s sale. Taiwan Semi-Conductor has also been reduced as the run up in its share price has made the yield less attractive.