Portfolio And Performance

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As of

Company objective

To provide long term capital appreciation for its shareholders through investment in companies listed in emerging markets or companies which earn a significant amount of their revenues in emerging markets, but are listed on stock exchanges in developed countries.

TEMIT has been helping investors access the dynamic growth potential of emerging markets companies since 1989.

More about TEMIT

Quick factsAs of 30/11/2020

Total Net Assets [further-information] £2,384.02 million
Market Capitalisation [further-information] £2,154.24 million
No of shares in issue 236,470,286
Net Gearing [further-information] 0.0%
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ChargesAs of 31/10/2020

Ongoing Charge [further-information] 0.99%

Key dates

Launch Date 12 June 1989
Financial Year End 31 March
Half-Year End 30 September
Annual Report Published June
Half-Yearly Report Published November
AGM July
Potential Interim Dividend Ex-D Date (for 2020 H-Y Report) December 2020
Potential Interim Dividend Record Date (for 2020 H-Y Report) December 2020
Potential Interim Payment Date (for 2020 H-Y Report) January 2021
Potential Final Dividend Ex-D Date (for 2021 Annual Report) June 2021
Potential Final Dividend Record Date (for 2021 Annual Report) June 2021
Potential Final Dividend Payment Date (for 2021 Annual Report) July 2021
Stock exchange announcements

Management


Investment strategy

As pioneers in emerging market equity investing, the Templeton Emerging Markets Group use their expertise, experience and local country knowledge to help them uncover emerging market companies with the potential to grow in value over the long-term.

Find out more

Risks

Like all stock market investments, you take the risk that the companies, currencies and markets that TEMIT invests in do not perform as expected. Emerging markets can be subject to significant and rapid changes in value, particularly in the short-term, so the value of your investment can rise and fall accordingly. It could mean you may get back less than you invested. Although you are free to decide at any time when to sell shares in TEMIT, you should consider it a long-term investment.

Past performance is not a guarantee or an indicator of future performance.

The companies in which TEMIT invests are, by reason of the locations in which they operate, exposed to the risk of a lack of established legal, political, business and social frameworks to support a securities markets or the imposition of trade barriers and exchange controls. They may make it difficult to sell investments or result in price changes. It may not always be possible to sell shares in investment companies such as TEMIT.

There is no guarantee that TEMIT will achieve its objective.

TEMIT can borrow money to purchase additional investments (gearing). This can increase the risk to your investment if the cost of the gearing exceeds the investment return from it.

These and other risk considerations are covered in TEMIT's annual report.

We are unable to provide any advice about TEMIT's suitability for your personal circumstances. If you are in any doubt you should speak to a professional financial adviser.

10 largest holdings As of {{portfolio.holdings.asOfDate}}

Security% of portfolio
SAMSUNG ELECTRONICS CO LTD 7.0268%
TAIWAN SEMICONDUCTOR MANUFACTURING CO LTD 6.9485%
NASPERS LTD 6.1070%
ALIBABA GROUP HOLDING LTD 5.5421%
ICICI BANK LTD 3.8199%
BRILLIANCE CHINA AUTOMOTIVE HOLDINGS LTD 3.3029%
UNILEVER PLC 3.0693%
TENCENT HOLDINGS LTD 3.0251%
LUKOIL PJSC 2.5616%
NAVER CORP 2.5132%


Portfolio Details

Sector breakdown As of 30/11/2020

SectorPercMSCI Emerging Markets Index (BM2658)
Information Technology 28.76 19.06
Consumer Discretionary 19.32 19.43
Financials 18.77 18.10
Communication Services 18.72 12.27
Consumer Staples 4.65 5.83
Materials 3.66 7.26
Energy 3.19 5.23
Industrials 2.26 4.39
Health Care 0.86 4.16
Real Estate 0.00 2.30
Utilities 0.00 1.97
Cash & Cash Equivalents -0.20 0.00

Country weightings As of 30/11/2020

CountryTEMITBenchmark (BM2658)
Hong Kong / China / Macao 31.51 40.72
South Korea 20.16 12.83
Taiwan 14.87 12.76
Russia 6.56 2.96
Brazil 6.35 4.97
India 5.78 8.09
South Africa 3.51 3.53
United Kingdom 2.43 0.00
Thailand 1.84 1.93
United States 1.44 0.00
Rest of the world 5.75 12.22
Cash & Cash Equivalents -0.20 0.00

GEARING

TEMIT has the ability to borrow money for investment purposes. The Board has agreed that the Company may borrow up to 10% of its net assets.

Net Gearing: 0.0% as at 30/11/2020

Market capitalisation As at 30 November 2020

<2.0 Billion 5.26%
2.0-5.0 Billion 8.22%
5.0-10.0 Billion 6.99%
10.0-25.0 Billion 8.61%
25.0-50.0 Billion 18.48%
>50.0 Billion 52.43%

Portfolio Characteristics As at 30 November 2020

Number of Holdings 83
Dividend Yield (i) [further-information] 2.47%
Price to Earnings (i) [further-information] 16.66
Price to Cashflow (i) [further-information] 7.08
Price to Book (i) [further-information] 1.69
Weighted Average Market Capitalisation (i) (billion) [further-information] £ 187.22

Performance

The prices of shares and income from them can go down as well as up, and investors may not get back the full amount invested. Past performance is not a guarantee or indicator of future performance. Currency fluctuation may affect the value of overseas investments. In emerging markets, the risks can be greater than in developed markets An investment in TEMIT entails risks which are described in the annual report.


Discrete Performance to the end of the last month

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Cumulative performance as at {{performance.tables.cumulative.asof}}

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MONTHLY COMMENTARY (AS OF 30 NOVEMBER 2020)

Overview

Emerging market (EM) equities climbed in November but trailed their developed market peers. Positive COVID-19 vaccine development data and increased clarity on US election results fuelled investors’ risk appetite globally, notwithstanding a jump in coronavirus cases in several parts of the world. Hopes for economic normalisation supported a surge in cyclical stocks. The MSCI Emerging Markets Index rose by 5.8%, while the MSCI World Index returned 9.3%, both in sterling terms.
Emerging Asian equities advanced. Thailand and Indonesia were amongst the top gainers as upbeat global cues sent investors into markets that had lagged the region’s year-to-date rally. South Korea’s market soared. Chinese equities dipped in sterling terms as the pound’s strength erased yuan-denominated gains. A risk-on backdrop and higher commodity prices buoyed Latin American equities and currencies. Brazil outperformed the broader region. Solid economic indicators reflected a continued recovery in Brazil. Stocks in Mexico rallied. Its economy rebounded in the third quarter. Emerging European stocks logged stellar gains even as COVID-19 cases continued to rise in some European countries. Russia’s market benefitted from a jump in crude oil prices as progress in vaccine developments lifted prospects for global oil demand. In the Middle East and Africa region, South African stocks finished higher as investors looked past cuts to South Africa’s sovereign credit ratings.

Portfolio Changes & Positioning

We added to some existing holdings and initiated a position in China-based solar glass maker Flat Glass. As a whole, we undertook purchases in consumer discretionary and information technology at the sector level, and in South Korea, China, and India at the market level. Overall, we reduced investments in communication services, consumer staples, and financials by sector. By market, we trimmed holdings in the United States and United Kingdom (both represented by companies that have significant exposures to EMs), as well as Indonesia.

Performance Attribution

Key stock detractors from TEMIT’s performance relative to the benchmark MSCI Emerging Markets Index included Chinese e-commerce giant Alibaba Group, and internet companies Naver in South Korea and Tencent in China.
In sector terms, stock selection in consumer discretionary, an overweight in communication services, and an underweight in materials held back relative returns. By market, China, South Korea, and South Africa contributed to relative weakness, all due to stock selection.
From a sector perspective, stock selection in both financials and health care helped relative performance, as did an overweight in information technology. In market terms, stock selection in India and overweights in both Russia and Brazil supported relative returns.

Outlook

Recent COVID-19 vaccine news has signalled a return to economic normalcy for most EMs sooner than initially anticipated, despite the resurgence of COVID-19 cases in many developed markets.
A stronger economic outlook has led to some sector rotation and a significantly larger number of stocks improving in performance. From a longer-term perspective, however, of greater importance to us is the concept of resilience versus vulnerability.
We have also found resilience in leading EMs at the macroeconomic level. We think that China, Taiwan and South Korea have handled the pandemic effectively, and we view this as a testament to the quality of their institutions, governance, and health care systems. We believe that long-term investment opportunities in India remain intact despite its cyclical slowdown, and the consumption story remains compelling to us.
The US election results could have wide-ranging implications for EMs. We expect reduced trade uncertainty and a less disruptive foreign policy under a potential Biden administration. Nonetheless, our bottom-up investment approach means that our focus stays on individual companies, and how each has prepared for the risks and opportunities that arise from a changing world.

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QUARTERLY PERFORMANCE ATTRIBUTION

Largest Contributors to Performance [further-information] (3 months to 30.09.2020)

Securities - Largest ContributorsSectorCountryTotal Effect (%)
Taiwan Semiconductor manufacturing co ltd Information Technology Taiwan 1.32
Alibaba Group holding ltd Consumer Discretionary China 0.53
Yandex NV Communication Services Russia 0.44
Samsung Life Insurance co ltd Consumer Discretionary South Korea 0.34
Cognizant Technology Solutions Corp Information Technology United Sates 0.16

Largest Detractors to Performance [further-information] (3 months to 30.09.2020)

Securities - Largest DetractorsSectorCountryTotal Effect (%)
Lukoil Pjsc Energy Russia -0.44
Itau Unibanco Holding s/a Financials Brazil -0.31
Naspers Ltd Consumer Discretionary South Africa -0.23
Banco Bradesco SA Financials Brazil -0.21
Banco Santander Mexico SA IN Financials Mexico -0.20

Largest Contributors to Performance [further-information] (3 months to 30.09.2020)

Sector

Total Effect (%)
Information Technology 1.46
Communication Services 1.08
Financials 0.45
Utilities 0.30
Health Care 0.28
Industrials 0.24
Consumer Staples 0.23
Real Estate 0.21
Materials -0.01
Cash & Other Net Assets -0.04
Energy -0.38
Consumer Discretionary -1.51

Country - Largest Contributors

Total Effect (%)
Taiwan 1.61
South Korea 0.46
China 0.28
United States 0.17
Russia 0.17

Country - Largest Detractors

Total Effect (%)
Brazil -0.55
India -0.39
South Africa -0.11
Mexico -0.06
Cambodia -0.04

Risks

Risk Statistics (As of 30.09.2020)

1 year3 years
Alpha [further-information] 3.21 1.74
Beta [further-information] 1.17 1.13
Annualised Downside Risk [further-information] 3.55 2.70
Information Ratio (Relative) [further-information] 0.74 0.49
R2 [further-information] 96.35 94.55
Sharpe Ratio [further-information] 0.42 0.34
Annualised Tracking Error [further-information] 5.24 4.29
Annualised Volatility [further-information] 21.89 16.53
Positive Months [further-information] 8 20
Negative Months [further-information] 4 16

Pricing overview As of {{pricing.asOfDate}}

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TEMIT Dividends (Paid or Declared)

Ex dividend datePay dateDividend per share
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