Value Investing in Asia: The Definitive Guide to Investing in Asia
Value Investing in Asia offers a uniquely targeted guide to investors seeking new opportunities in Asian markets. Most value investing advice is geared toward US markets, leaving out the key guidance that pertains specifically to investing in publicly listed Asian companies — guidance that is critical for success. This book focuses on the opportunities and challenges of Asian markets, including current and historical case studies that illustrate various successes, risks and pitfalls. Step-by-step guidance helps you unearth great opportunities in Asia; from understanding the macroeconomic situation, to narrowing down on specific investment opportunities. Invaluable for both new and experienced investors, this practical reference shows you how to apply value investing principles specifically to Asian stocks.
Investing in Asia comes with an inherent set of unique challenges that must be understood before any decisions are made; some of these challenges are the result of operating practices, some are the result of regulatory issues and others come from the markets themselves — yet regardless of the source, value investors in particular bear the brunt of the obstacles. This book shows you what you need to know, and how to invest intelligently in Asian companies.
- Step-by-step approach guides investors towards the practical application of value investing principles in Asia
- Navigate the challenges unique to Asian investing
- Examine real-life case studies that illustrate both risk and opportunity
- Delve into the key markets in Greater China and South-East Asia
- Includes exclusive interviews with well-known value investors in Asia
Despite the challenges and risks, Asian markets represent significant opportunity — especially for investors seeking value. Value Investing in Asia offers a practical reference for new and experienced investors, with real-world guidance toward intelligently investing in Asian markets.
About the Authors xxi
Chapter 1 Value Investing in Asia 1
The Investor and the Market
Why Value Investing Works
Three Types of Value to Be Found
Chapter 2 Key Developments in Asia 11
What Is in Asia?
What Has Happened in Asia?
Chapter 3 Uniquely Asia 31
What Asia Has Going for It
Corporate Governance in Asia
Disclosure and Transparency
“Smart” Money Gets Hit Too
Government – The Elephant in the Room
Don’t Bet Your House on Legal Prosecution
Activism and Shorting
Chapter 4 The Future of Investing in Asia 75
ASEAN, Pushing Ahead
The Wall Street of Asia
From ‘‘Guanxi’’ to Transparency
The Future of Healthcare
The Asian Consumer Story Lives On
Chapter 5 Using the Right Process 89
Current Earning Power Value
Narrow Your Search – Screening
Screen Your Screens
The 5-Fingers Rule
The Importance of the 5-Fingers Rule
Chapter 6 Research Like a Businessman 115
Getting the Right Data
Annual Reports Are Your Best Friend
Making Sense of an Annual Report
Don’t Stop at One
Why Should I Read a Competitor’s Annual Report?
Who Do I Speak To?
It is More Than Just the Numbers
Chapter 7 Finding Red Flags 141
What are Red Flags?
Financial Red Flags
Non-Financial Red Flags
Chapter 8 Three Simple Valuation Techniques to Live By 161
Discounted Cash Flow
Always Remember Your Margin of Safety
Chapter 9 How Everything Comes Together 185
Value Through Assets – Hongkong Land Holdings Limited
Current Earning Power – Tingyi (Cayman Islands) Holdings Corporation
Growth in Cyclicality – First Resources Limited
Special Situation – Dalian Wanda Commercial Properties Co., Limited
High Growth – Tencent Holdings Limited Conclusion 221
An Interview with Wong Kok Hoi of APS Asset Management
An Interview with Tan Chong Koay of Pheim Asset Management
An Interview with Wong Seak Eng, Kevin Tok and Eric Kong of Aggregate Asset Management
An Interview with Yeo Seng Chong of Yeoman Capital Management
An Interview with David Kuo of Motley Fool Singapore
STANLEY LIM PEIR SHENQ, CFA, has worked in the investment industry for many years. Most recently, he was an analyst for The Motley Fool Singapore. He has written close to 2,000 investment articles online. Stanley is currently the chief editor for ValueInvestAsia.com.
CHEONG MUN HONG, CFA, started his career as an investment analyst at a Singapore-licensed Trust Company. Over the course of his work, he has dealt with investments involving public and privately held entities. Mun Hong sits on the boards of listed companies.