Defensive portfolio benefits Aberdeen New India – Aberdeen New India has published results for the year ended 31 March 2020. The year end is struck close to the depths of market falls. over the period, the trust’s NAV fell by 22.7% and its share price by 28.9% (as the discount widened from 13.3% to 20.3%). The benchmark, MSCI India, fell by 27.3%. An interim dividend may be on the cards as revenue for the period was 2.08p, however this will need to be offset against brought forward cumulative revenue losses.
The NAV has recovered by almost 20% since the end of March.
The chairman says that “the manager’s preference for defensive consumer staples proved beneficial as the crisis broke. Notably, your company’s exposure to Nestle India and Hindustan Unilever, contributed to the year’s performance. Both of these large fast-moving consumer goods companies managed the slowdown in rural demand. Similarly, the slump in oil prices helped lower production costs and boost market leader Asian Paints. Its robust cash position and brand popularity, which confers pricing power, should enable it to withstand the economic shocks. Elsewhere, the halt in economic activity amid the lockdown heightened concerns over worsening bad debts and a liquidity crunch among financials. Investors favoured high quality well-capitalised financial stocks, backed by solid management, such as Kotak Mahindra Bank, Bandhan Bank and leading life insurer SBI Life Insurance, which proved more resilient than the broader market.”
ANII : Defensive portfolio benefits Aberdeen New India