22nd May 2025 12:49
(Alliance News) - Schroder Oriental Income Fund Ltd on Thursday reported an "impressive" decade-spanning NAV total return, but said it delivered against its benchmark over its first half.
The Asia Pacific-focused investor said that for the six months ended February 28, its net asset value total return was positive 2.5%. This "lagged" the "Reference Index", the MSCI AC Pacific ex Japan, which delivered a 10.4% total return.
"This relative underperformance was in large part due to underweight positioning in China and the rally of internet platform names and IT companies - most of which pay little or no dividend, resulting in minimal exposure there," the firm said.
Schroder Oriental said its NAV per share was 288.77 pence as of February 28, up from 267.12p at February 29, 2024.
The company also said that over the last ten years it "has delivered an impressive cumulative NAV total return of +116.3%" while the benchmark generated a positive 83.3% return over the same period.
For the first half, it said it has paid 2.00p per share first and second interim dividends for the year ending August 31. It also noted that it has "grown its dividend every year since launch".
Chair Nick Winsor commented: "The period under review was characterised by two distinct factors affecting Asia-Pacific markets: an initial rally in China as a result of government stimulus, which subsequently faltered due to a lack of further support measures, and a later period of volatility across the region as investors sought to digest the implications of Donald Trump's election for a second term as US president.
"In addition to the uncertainty created by the election of President Trump, a firmer outlook for interest rates and a stronger dollar also negatively impacted sentiment across the region."
Looking ahead, Winsor warned that the "outlook for global investment markets has become increasingly uncertain", noting that the US and China "are engaged in an escalating battle of tit-for-tat tariff increases, which has unsettled investors around the world".
He continued: "Nevertheless, the economies of Asia remain among the fastest growing in the world...The Asian Development Bank has noted that 52% of the foreign direct investment in Asia is intra-regional and the degree of Asia's trade integration is now comparable to that of the European Union and the UK.
"If the region can continue on this path, then the long-term prospects for your company and the businesses in which it invests should remain favourable, regardless of how the dust from President Trump's tariff war settles."
Shares in Schroder Oriental were down 0.4% at 275.50 pence early on Thursday afternoon in London.
By Emma Curzon, Alliance News reporter
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