LONDON (Alliance News) - Aberdeen Asian Income Fund Ltd Monday said its net asset value returned 3.8% in sterling terms over the six months to June 30, which it said came amid a stabilisation of emerging markets, including Asia, following the wave of sell-offs last year.
"Many economies, in particular those deemed vulnerable to shifts in global liquidity, have improved their current accounts, paving the way for a cyclical recovery," the fund said in a statement.
Against this backdrop, the ordinary share price total return was 5.4% and the premium over NAV per share widened from 1.8% at the start of the year to 3.3%.
Chairman Peter Arthur said the fund's performance was driven by stock selection, most notably in Singapore and Australia.
"The holding in Singapore Post, the city-state's main postal service, was the single largest positive contributor. Its announcement that Alibaba, the Chinese e-commerce giant, is taking a strategic stake to capitalise on its logistics capabilities within Southeast Asia lifted its share price. Both also agreed to form a joint venture to provide logistics services," Arthur said in a statement.
"Jardine Cycle & Carriage, a recent addition to the portfolio, rose on the back of pre-election enthusiasm in Indonesia. Its earnings are driven by Astra International, which has solid businesses across the automotive distribution, palm oil plantation and coal-mining contracting sectors in Indonesia. The stock is attractively valued given the price weakness last year and offers a yield of about 3%," Arthur added.
Turning to Australia, Arthur pointed to Scentre Group, spun off from the restructure of Westfield Retail Trust and Westfield Group, which rose after its debut in June.
"The new entity owns Westfield Trust's Australian and New Zealand operations after the demerger, while Westfield Group was renamed Westfield Corp and holds the international businesses. The reorganisation has resulted in a clearer separation of the founding family's assets and a more focused portfolio within each vehicle. It also enables Scentre Group to undertake development projects in Australia and New Zealand without being hampered by borrowing constraints under the previous trust structure," Arthur said.
"Meanwhile financial holdings, Australia & New Zealand Banking and Commonwealth Bank of Australia benefited from good interim earnings, which surpassed expectations despite muted demand for credit," Arthur added.
He also noted that favourable positioning in China and Thailand also enhanced performance.
Aberdeen Asian Income Fund shares were Monday quoted up 0.4% at 207.26 pence.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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Abrdn Asn Inc (AAIF)