Published: 15th July 2024
By: Value Research
China’s economy seems to be on an upward trajectory. With GDP growth exceeding expectations in the first quarter of 2024, a rebound in company earnings and a surging manufacturing sector, the economy looks to be in good shape.
A closer look at the financials paints a completely different picture.
1) Prevailing slowdown in real estate, 2) Sluggish post-Covid growth 3) Low consumer confidence 4) Souring foreign relations 5) Foreign capital outflows
Right now, around 15 Indian funds are invested in Chinese equities, with a collective AUM of Rs 3,400 crore. Of this, Edelweiss Greater China Equity Off-shore Fund and Nippon India ETF Hang Seng BeEs manage more than 50% of the total assets.
Both Edelweiss Greater China Equity Off-shore Fund and Nippon India ETF Hang Seng BeEs have underperformed the Indian market (BSE 500 TRI) by wide margins.
While BSE 500 TRI’s five-year CAGR was 21% (as of July 11, 2024), Edelweiss grew at a mere 7% while Nippon’s growth was in the red (-2.7%) during the same period.
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