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Brilliance China Automotive Holdings Ltd. 9.8% Automobiles, China

Vale SA Metals & Mining, Brazil


Petrobras (Petroleo Brasileiro SA) Oil, Gas & Consumable Fuels, Brazil


PT Astra International Tbk Automobiles, Indonesia


Akbank TAS Commercial Banks, Turkey


PT Bank Central Asia Tbk Commercial Banks, Indonesia


Tata Consultancy Sevices Ltd. IT Services, India


Sesa Goa Ltd. Metals & Mining, India


Banco Bradesco SA Commercial Banks, Brazil


Dairy Farm International Holdings Ltd. Food & Staples Retailing, Hong Kong


automobile manufacturer; Astra International, Indonesia’s leading car and motorcycle company; and SK Innovation (formerly, SK Energy), a major oil refinery and service station operator in South Korea. Brilliance China has a joint venture with BMW for the production and sale of BMW 3-series and 5-series models in China. Its share price surged as the company benefited from demand growth for automobiles and government stimulus measures in the sector. Astra International’s share price appreciated due to strong corporate results supported by greater domestic demand for motor vehicles and higher profits from its heavy equipment and palm oil businesses. The company benefited from Indonesia’s robust economic growth, higher incomes and affordable credit. SK Innovation’s share price rose due to improved refining margins as South Korea’s largest oil refiner benefited from increased demand and higher product prices following the political unrest in the Middle East and North Africa, which threatened oil supply from the region, and the strongest earthquake on record in Japan, which disrupted output from the country’s petrochemical plants and refineries. Consis- tent with our long-term investment strategy, we hold a positive outlook on the energy and consumer discretionary sectors.2

In contrast, key detractors from absolute performance included Akbank, one of Turkey’s biggest commercial banks; Sesa Goa, India’s leading iron ore miner and exporter; and Victory City International Holdings, a Hong Kong-based integrated group of textile manufacturing companies with operations in Hong Kong, China, the U.S. and Canada. Shares of these companies ended the report- ing period with double-digit declines. Akbank’s share price suffered a setback due to narrower net interest margins, which affected the bank’s net interest income. Nonetheless, we continued to consider the bank’s valuations attractive and maintained a positive long-term outlook on Akbank due to its high-quality assets and relatively strong market position. Shares of Sesa Goa declined in value as a result of a possible increase in iron ore export taxes and a general correction in the Indian stock market. In our view, low valuations and high profitability could benefit Sesa Goa in the long term. Victory City was hurt by concerns of slowing growth in developed markets such as the U.S., which could subsequently impact export orders. According to our analysis, the company could have favorable prospects because it trades at what we consider an attrac- tive valuation, has an extensive clientele and could benefit from the possibility of industry consolidation in China.

It is important to recognize the effect of currency movements on the Fund’s performance. In general, if the value of the U.S. dollar goes up compared with a foreign currency, an investment traded in that foreign currency will go down in value because it will be worth fewer U.S. dollars. This can have a negative


% of Total

Sector/Industry, Country

Net Assets

Top 10 Holdings


2. The energy sector comprises oil, gas and consumable fuels and energy equipment and services in the SOI. The consumer discretionary sector comprises automobiles and textiles, apparel and luxury goods in the SOI.

Annual Report


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