James Will

It outperformed its benchmark, the MSCI Asia ex Japan Index, which increased by 14.7% on a comparable basis over the reporting period.

The share price rose, on a total return basis, by 24.3% as at 31 August 2021, with the discount to NAV per share narrowing to 9.6%.

Asia Dragon Trust plc looks to achieve long-term capital growth through investment in Asia, (with the exception of Japan and Australasia) investing primarily in stock markets in the region, principally in large companies.

It saw significant outperformance with the company’s portfolio well-positioned for the challenging conditions, which had deteriorated progressively as the second half evolved.

The company did particularly well in China, with the selection of underlying holdings accounting for the bulk of its outperformance, even though the market grew increasingly turbulent.

Chairman James Will said: “For now, mitigating regulatory risk is key for investors in China. In this respect, the managers of Asia Dragon Trust’s long track record, on-the-ground presence and focus on companies with good ESG practices has enabled them to anticipate the notable strides made by Chinese corporates.

“Many now appreciate the importance of engaging with long-term investors and the value it can create for a company. Boards and senior management are also paying attention to the environmental impact of their company’s practices.

“Companies understand, too, that how they manage their relationships with key stakeholders, such as employees, vendors and society, is important, as regulatory scrutiny is tightened to address a range of issues.

“ESG considerations have always been an integral part of the Company’s managers investing process and the Trust’s holdings – in China and elsewhere – are selected after careful due diligence on their ESG underpinnings, among others.”