Unlocking Opportunities in Emerging Asia

Strategies

Equity

Asia Opportunity

  • Flagship
  • Secondary Market
  • IPO/Pre-IPO

Private Equity

  • China Frontier Economy

Structured Credit

Asset Based Lending

  • SEA Residential Mortgages
  • APAC Consumer Credits
  • APAC SME Loans

Public Market Securities

  • China ABS/RMBS
  • U.S. ABS

Aviation

Aircraft-Related Securities

  • Aircraft-Related Securities
  • Aviation Asset and Investment Management

  • Aviation Asset and Investment Management
  • Other Assets

    Money Market

    • Asian Money Market

    Real Estate

    • China Real Estate
    • Hong Kong Real Estate
    • Ho Chi Minh City Real Estate
    • Singapore REITs

    Strategy Highlights

    Strategy Summary

    • Seeks to generate risk-adjusted returns by identifying and capturing market risk-reward asymmetry and inefficiency through bottom-up analysis
    • Focused on long term value investments with relatively low dispersion and turnover of portfolio
    • To capture market opportunities from emerging Asian market and China companies’ overseas IPO

    Investment Rationale

    • Emerging Asian market consists of 1/3 of global GDP with economic growth contribution of 60% in 2019
    • A quicker rebound after COVID-19 is forecasted in Asian developing countries compared to developed countries and other developing countries
    • Large potential consuming market of over 3 billion thanks to Asia countries’ quick development and increasing middle class population
    • MSCI EM Asia return rate reached 422% from Dec 2000 to April 2020 with annualized return rate at 8.92%, much higher than developed countries

    Strategy Summary

    • Seeks to generate returns with short-term cash deposits in the base currency of the Fund while maintaining liquidity and preservation of capital.
    • Invest in money market instruments such as bank certificates of deposit, term deposits, commercial papers and treasury bills and short-term high quality fixed income securities issued by issuers primarily from ASEAN countries and China.
    • Short remaining maturity of most investments (such as no more than 1 year) to maintain high liquidity.

    Investment Rationale

    • Political stability and consistence in Vietnam with continued openness and quick economic growth results in a GDP growth of over 7% in the past two years and low macroeconomic risks.
    • Vietnam banks demonstrate a quick growth in deposit, loan and total asset, with an attractive net interest margin and ROE, compared to other Asia countries. While their NPL remain low.
    • VND/USD demonstrated a lower volatility against USD/RMB and further appreciation can be expected as Vietnam is labeled as currency manipulator by US in 2021
    • It is foreseen that monetary policy will remain stable in US in the next 1-2 years with FED keeping funds rate near zero; Vietnam CDs provide a competitive return rate even after hedging cost.

    Strategy Summary

    • Seeks to generate stable income with attractive duration-adjusted returns
    • Invest mainly in short duration investment grade structured credit products in China
    • Catered to international investors seeking to increase or diversify exposure to China fixed income market and interest rate environment as well as APAC regional investors seeking diverse cash management tools

    Investment Rationale

    • The China ABS market have exploded from c. USD 5 billion in 2012 to close to USD 96 billion in 2020, becoming the second largest ABS market by issuance in the world
    • Higher 10Y China Government Bond, which provides approximately 150 bps pickup against 10Y US Treasury
    • ABS issuance in China has conservative collateral characteristics due to market conditions and regulatory requirement compared to the US, with lower LTVs and a larger diversified pool of borrowers

    Strategy Summary

    • Seeks to develop financing solutions for each stage of a business life cycle, across the entire capital structure
    • Provides bespoke lending solutions to borrowers by adopting asset-based risk analysis as well as credit and structure driven risk pricing
    • Catered to investors seeking material yield pick-up from liquidity premiums and better structural protections while maintaining a comparable asset based risk exposure to public market ABS

    Investment Rationale

    • Middle class is expected to increase from a population of 2 billion to 3.5 billion by 2035, fueling growth and changes in consumption habits
    • Unlike developed markets in Europe and the US, banks in Asia play a larger role in providing credit, providing 80 cents for every dollar of credit in Asia, compared to 60 cents in Europe and less than 10 cents in the US
    • Post Covid-19 pandemic, it is expected that banks will remain risk-off and continue to retrench from risk assets, further widening the funding gap in the region
    • Traditional corporate lending that focuses on corporate balance sheet and operations and relies on excessive securities and corporate guarantees to de-risk lenders will no longer be adequate

    Strategy Summary

    • Seeks to capture the market opportunities aroused from China’s regulatory dynamics in real estate sector.
    • To creatively bridge China RE with potential investors through both onshore and offshore structures such as VCC fund, WFOE
    • Various risk control tools can be applied such as parentage support, property mortgage and corporate guarantee based on clos.

    Investment Rationale

    • China real estate still remains one of the most profitable markets with strong net profit margin and ROE.
    • Leading real estate developers, especially SOEs, will contribute more to market share with land supply and financial curb tilting towards them
    • Selectively work with leading RE players with strong parentage support and stable financial and business performance as partners and subscribers of the fund
    • Light-asset business model with capital injection and shareholder loan that is provided by financing through fund share and fund debt

    Strategy Summary

    • To acquire and manage a diversified portfolio of aircraft through the down-cycle and capitalize on the recovery
    • Focused on opportunistically purchasing aircraft on lease to major airlines, distressed ABS, airline /lessor debt

    Investment Rationale

    • Coupled with robust long-term prospects for the industry, the COVID-19 pandemic has created a rare opportunity to acquire young and in-demand aircraft on long term lease to top airlines at a hefty discount
    • Significant capital needs for the Sector as decreasing aircraft supply will drive increased demand for assets
    • Industry dynamics remain attractive with key drivers such as emerging markets and their expanding middle class.
    • Air travel shows strong historical resilience with traffic declining during 9-11 and 2009 Financial Crisis, but quickly recovering by double digits the following year
    • SLBs provide liquidity constrained airlines a financially efficient option to meet their required fleet needs, take key delivery positions, and enhance fleet flexibility

    Select Investments

    Participated in Series C investment in a Biotech company, which is dedicated to the development of oncolytic virus("OV") and vector type approaches to create more effective and safer therapies against cancer. The company is expected to be listed in coming two years

    Mezzanine investment in a residential mortgage warehouse facility secured by a pool of prime residential mortgages in Hong Kong