21st May 2024 11:26
(Alliance News) - Schroder AsiaPacific Fund PLC on Tuesday said the fund outperformed its benchmark aided by its reduced exposure to China.
The Asia-focused investment fund said at March 31, net asset value per share fell 1.6% to 569.02 pence per share, down from 578.15p a year before.
Over the six month period the company's NAV total return rose 5.7%, marginally outperforming the benchmark MSCI AC Asia ex Japan Index.
During the same period last year the fund returned 8.1% while the benchmark rose 4.9%.
Unchanged from last year, no interim dividend was declared.
Chair James Williams commented: "Performance over the period was helped by strong stock selection in Taiwan and the ASEAN markets of the Philippines and Indonesia. The company also benefited from the significant underweight to China. However, this was somewhat offset by negative stock selection within China."
Compared to the benchmark's weighting of Chinese stocks at 29%, they account for 16% of the funds holdings.
Healthcare services company WuXi Biologics was one such negative selection which particularly suffered from concerns over the impact of proposed US legislation which could impose restrictions on its US operations.
Looking ahead, the fund believes the prospects for Asian markets will remain challenging with geopolitical tensions weighing heavily on investor sentiments and leading to a significant de-rating of equities in China and Hong Kong.
Furthermore, the macroeconomic environment and the number of elections taking place across the region this year add further volatility to the market.
However, the fund does see reason to be somewhat optimistic about the scope for improved market performance and growth in China.
In other news, the company has progressed its buyback programmed as part of its share discount management strategy.
A total of 3.6 million shares were repurchased for cancellation at a cost of GBP17.3 million, and since the end of the period an additional 1.4 million shares were bought.
During the six months shares traded on an average discount of 11.4%.
Schroder AsiaPacific shares were down 1.4% to 522.57 pence each in London on Tuesday morning.
By Elijah Dale, Alliance News reporter
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