China Tech Alive And Well: JPMorgan

Bloomberg

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00:00You're also constructive when it comes to China at the moment.

00:02Can you tell us why?

00:04Because, of course, depending on which camp you're in,

00:07you can either be quite positive in terms of the economic recovery

00:10and sort of made in China's strategy

00:12and some of the tech advancements being made.

00:15On the other hand, it is front and centre

00:17when it comes to these tariff uncertainties.

00:22So, yes, for China, I think we need to remember

00:26that we started our year at a very low valuation point.

00:31So China has been a very difficult market.

00:36And obviously, being an exporter, the tariff news don't help.

00:41But what we've seen post the deep-seek moment

00:45is that China tech is well and alive.

00:49There's a lot of activity going into the Chinese tech companies.

00:53And also what we have seen so far

00:56is that the consumption,

00:57although the overall consumption is still weak,

01:01the affordable sectors,

01:03so much of these are domestic China brands,

01:07there are many of them

01:08that are actually growing quite strongly year over year.

01:12So I think once we shift the focus to more, again,

01:15domestically exposed sectors,

01:19we do see some positive signs.

01:21And that's, again, where we are focused on.

01:23And as you point out, rightfully,

01:27consumption and household sentiment

01:29still remains quite subdued.

01:31And, you know, there's been a lot of focus

01:33on things like milk tea, for example, or Pop Mart.

01:38Which sort of these sectors and companies

01:40do you think are compelling at the moment

01:41in that consumption space,

01:43despite the downtrend in consumption that we see?

01:46Yes, so, I mean, this might be a very consensus call,

01:54but companies like Xiaomi, for example,

01:57in all of the segments that they are exposed to,

02:01they offer affordable tech

02:04in smartphones, in home appliances, in EVs.

02:09They have the right design,

02:10the right price points,

02:12and with good technology.

02:14And their market is basically domestically China.

02:18So these are companies that we feel are interesting.

02:22They also lead in terms of certain technology areas.

02:26And again, you know, technology, internet,

02:31this is an area where China has been

02:33and is still strong at.

02:35So these are companies that we are interested in.

02:38And...

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