Portfolio And Performance

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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 31/01/2021

Total Net Assets [further-information] £2,590.17million
Market Capitalisation [further-information] £2,290.19 million
No of shares in issue 236,345,731
Net Gearing [further-information] 0.0%
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ChargesAs of 31/01/2021

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 31/01/2021

SectorPercMSCI Emerging Markets Index (BM2658)
Information Technology 30.72 20.88
Consumer Discretionary 18.76 19.27
Financials 18.12 17.14
Communication Services 17.41 12.28
Consumer Staples 4.44 5.66
Materials 3.09 7.40
Industrials 2.76 4.24
Energy 2.29 4.59
Health Care 1.13 4.68
Cash & Cash Equivalents 0.81 0.00
Real Estate 0.47 1.95
Utilities 0.00 1.91

Country weightings As of 31/01/2021

CountryTEMITBenchmark (BM2658)
Hong Kong / China 30.33 40.13
South Korea 21.41 13.30
Taiwan 16.61 13.32
Brazil 5.88 4.61
Russia 5.64 2.81
India 5.63 8.86
South Africa 3.59 3.49
United Kingdom 2.08 0.00
Thailand 1.89 1.78
United States 1.28 0.00
Rest of the world 4.92 11.70
Cash & Cash Equivalents 0.81 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 31/01/2021

Market capitalisation As at 31 January 2021

<2.0 Billion 4.08%
2.0-5.0 Billion 7.94%
5.0-10.0 Billion 4.32%
10.0-25.0 Billion 10.86%
25.0-50.0 Billion 15.66%
>50.0 Billion 57.14%

Portfolio Characteristics As at 31 January 2021

Number of Holdings 83
Dividend Yield (i) [further-information] 1.87%
Price to Earnings (i) [further-information] 19.20
Price to Cashflow (i) [further-information] 8.65
Price to Book (i) [further-information] 2.04
Weighted Average Market Capitalisation (i) (billion) [further-information] £ 217.21

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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MONTHLY COMMENTARY (AS OF 31 January 2021)

Overview

Stocks worldwide began 2021 on a strong footing as markets eyed increased US stimulus following the Democrats’ Senate election victories. However, the uptrend stalled in the face of potential delays to the stimulus package, stock valuation concerns, and a resurgent pandemic amidst slow vaccine rollouts and the spread of new coronavirus strains.
Emerging Asian equities outpaced broader emerging markets (EMs). East Asian markets were largely stronger. Both Taiwan and China posted better-than-expected economic growth for 2020 and were amongst the few markets in the world to avoid a contraction during the pandemic.
Latin American markets were amongst the weakest EMs. Nonetheless, we have seen significant innovation taking place in Brazil and capital market activity has been vibrant.
Emerging European equities lost ground as parts of Europe continued to confront rising COVID-19 cases and mobility curbs. In the Middle East and Africa region, South African stocks rose.

Portfolio Changes & Positioning

Stocks worldwide began 2021 on a strong footing as markets eyed increased US stimulus following the Democrats’ Senate election victories. However, the uptrend stalled in the face of potential delays to the stimulus package, stock We added to some existing holdings and initiated positions in the portfolio. A new holding was China Resources Land, a leading property company in China that stands out to us for its strong brand, healthy balance sheet, robust land bank, and resilient investment property portfolio. As a whole, we undertook purchases in real estate, consumer discretionary, and health care by sector, and in Brazil and India by market.
At the market level, we reduced holdings in China and South Korea.

Performance Attribution

Major stock contributors to TEMIT’s performance relative to the benchmark MSCI Emerging Markets Index included internet companies Tencent in China and Naver in South Korea, as well as chip maker Taiwan Semiconductor Manufacturing Company (TSMC).
Looking across sectors, an overweight and stock selection in communication services, stock selection in financials, and an overweight in information technology bolstered relative returns. In market terms, stock selection in both Taiwan and China, together with stock selection and an underweight in India, drove relative strength.
In contrast, key stock detractors from relative performance included car maker Brilliance China Automotive, South Korea-based semiconductor and consumer electronics company Samsung Electronics, and Brazilian lender Itau Unibanco.
At the sector level, stock selection in consumer discretionary was the main drag on relative returns. From a market perspective, an overweight and stock selection in Brazil and an overweight in Russia weighed on relative results.

Outlook

A key contributor to EM equities’ performance in 2020 was their exposure to fast-growing technology-centric companies, and this driver has extended into the start of 2021. EMs have broadly shifted away from an old-economy model that relies largely on commodities and now lean heavily on a new-economy model fuelled by technology and innovation.
Digital disruption is a trend that we have been monitoring closely. We have seen a proliferation of online consumers, devices, and enterprises, and we expect cloud computing, the Internet of Things, fifth generation wireless technology (5G) and other applications to feed demand for semiconductors and other technology products.
We also seek to capture longer-term investment opportunities from growing consumer penetration and a “premiumisation” of buying patterns in EMs.
Looking ahead, we believe that the earnings outlook for EM companies is likely to depend on a range of factors such as global health care outcomes, the pace of economic reopenings, and geopolitics (including US-China and US-Russia relations).

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QUARTERLY PERFORMANCE ATTRIBUTION

Largest Contributors to Performance [further-information] (3 months to 31.12.2020)

Securities - Largest ContributorsSectorCountryTotal Effect (%)
Taiwan Semiconductor manufacturing co ltd Information Technology Taiwan 2.27
Naver Corp Communication Services South Korea 1.89
Samsung Electronics Co Ltd Information Technology South Korea 1.78
Tencent Holdings Ltd Communication Services China 1.10
Yandex Nv Information Technology Russia 0.83

Largest Detractors to Performance [further-information] (3 months to 31.12.2020)

Securities - Largest DetractorsSectorCountryTotal Effect (%)
Meituan Consumer Discretionary China -0.87
Nio Inc Consumer Discretionary China -0.65
Jd.Com Inc Consumer Discretionary China -0.60
Pinduoduo Inc Consumer Discretionary China -0.53
Xiaomi Corp Information Technology China -0.41

Largest Contributors to Performance [further-information] (3 months to 31.12.2020)

Information Technology1.23

Sector

Total Effect (%)
Financials 2.18
Real Estate 0.28
Industrials 0.13
Energy 0.08
Health Care 0.00
Cash & Other Net Assets -0.01
Utilities -0.02
Materials -0.42
Consumer Staples -0.59
Communication Services -0.83

Country - Largest Contributors

Total Effect (%)
India 0.87
South Korea 0.77
Saudi Arabia 0.33
Taiwan 0.24
Thailand 0.23

Country - Largest Detractors

Total Effect (%)
China -3.09
United Kingdom -0.55
Russia -0.20
Kenya -0.11
South Africa -0.06

Risks

Risk Statistics (As of 31.12.2020)

1 year3 years
Alpha [further-information] -0.85 1.52
Beta [further-information] 1.15 1.13
Annualised Downside Risk [further-information] 3.65 2.66
Information Ratio (Relative) [further-information] 0.16 0.51
R2 [further-information] 96.10 94.69
Sharpe Ratio [further-information] 0.71 0.47
Annualised Tracking Error [further-information] 5.16 4.26
Annualised Volatility [further-information] 22.06 16.71
Positive Months [further-information] 9 21
Negative Months [further-information] 3 15

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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