Get the right experience for you. Please select your location and investor type.
Global Emerging Markets Leaders
The strategy invests in 25-60 high-quality emerging markets companies that we consider to be well positioned to contribute to, and benefit from, sustainable development.
Investment objective and strategy
The Fund aims to achieve long term capital appreciation and sustainably invest in companies which both contribute to, and benefit from, sustainable development, achieving positive social and environmental sustainable outcomes. The Fund invests primarily in large and mid-capitalisation equity securities or equity-related securities in emerging economies, including those of companies listed on developed market exchanges whose activities predominantly take place in emerging market countries.
The Global Emerging Markets Leaders strategy launched in April 2020. It invests in 25-60 high-quality emerging market companies that we consider to be particularly well positioned to contribute to, and benefit from, sustainable development.
Leaders simply means that the strategy is focused on companies with a market cap value of at least USD1 billion.
Strategy highlights: a focus on quality and sustainability
- Companies must contribute to sustainable development. Portfolio Explorer >
- We invest in high-quality companies with exceptional cultures, strong franchises and resilient financials. How we pick companies >
- We avoid companies linked to harmful activities and engage and vote for positive change. Our position on harmful products >
- Our approach is long-term, bottom-up, high conviction and benchmark agnostic
- We focus on capital preservation as well as capital growth – we define risk as the permanent loss of client capital
Latest insights
Quarterly updates
Global Emerging Markets Leaders strategy update: 1 January - 31 March 2025
The volatility seen across emerging markets in the final quarter of 2024 carried over into 2025. Share prices in India fell sharply due to concerns about a cyclical slowdown. China, by contrast, performed well as investors anticipated a reacceleration in economic growth and began to identify value in many parts of the market. Sentiment was also supported by President Xi, who met executives from a number of private-sector companies.
We added 10 new holdings to the portfolio over the quarter and sold seven. Although it is unusual to see so many names exiting and entering the portfolio, turnover as a percentage of assets under management remained low at around 12%1. We were, in essence, simply tidying up a number of our smaller positions – the ‘tail’ of the portfolio.
In China, we sold out of Glodon (China: Information Technology), Hangzhou Robam (China: Consumer Discretionary), WuXi Biologics (China: Health Care), Ping An Insurance (China: Financials) and Hong Kong Exchanges and Clearing (Hong Kong: Financials). The first two sales were informed by our view of China’s property market, where we don’t see the issue of oversupply being resolved any time soon. Glodon provides software for construction and development companies. The majority of Hangzhou Robam’s appliances, meanwhile, are sold to housing developers. WuXi Biologics was a small position and we couldn’t see any immediate prospect that the ongoing challenges posed by US government trade policy would be resolved. Although Ping An Insurance and Hong Kong Exchanges and Clearing had both performed well, we sold them to reallocate the capital into new investment ideas such as Alibaba (China: Consumer Discretionary), S.F. Holding (China: Industrials) and Mindray (China: Health Care).
Alibaba is one of China’s leading e-commerce platforms. It is using the strength of its balance sheet to invest in its AI capabilities. S.F. Holding has grown into one of China’s leading logistics businesses since its foundation in 1992. Its founder is still involved in the company’s day-to-day management. Mindray is a leading medical company. As trade barriers are thrown up around the world, it has the potential to benefit should there be a shift in China towards buying domestically sourced products.
Elsewhere, we added a handful of new names and trimmed some existing positions. We took some profits in Marico (India: Consumer Staples) and reallocated the capital to Info Edge (India: Communications), Tube Investments (India: Consumer Discretionary), Bajaj Auto (India: Consumer Discretionary) and Bajaj Holdings & Investment (India: Financials). These companies had been on our focus list for a while but their valuations had dissuaded us from establishing positions. InfoEdge is a technology company whose online jobs portal caters to 132,000 corporate customers and hosts around 100 million CVs2. It also has property, matchmaking and educational portals. Tube Investments is an industrial conglomerate whose share price had fallen sharply, providing us with what we believe is an excellent entry point. Bajaj Auto had also sold off allowing us to add this leading manufacturer of motorcycles, scooters and auto rickshaws, which is backed by a high-quality steward. Bajaj Holdings & Investment is the holding company of siblings Rajiv and Sanjiv Bajaj. They have demonstrated an exemplary track record of delivering returns for shareholders in autos and financial services.
Elsewhere, we sold convenience store business Dino Polska (Poland: Consumer Staples), which had performed well but which had become too expensive for its long-term growth expectations. We also sold Unicharm (Japan: Consumer Staples). While it has pivoted to adult diapers in response to demographic change, it has found this shift harder than it had originally envisaged.
We built positions in Samsung Biologics (South Korea: Health Care), Alfamart (Indonesia: Consumer Staples), Voltronic Power (Taiwan: Industrials) and BDO Unibank (Philippines: Financials). We believe Samsung Biologics can use the strength of its parent company’s balance sheet to add capacity more quickly than its competitors and win market share. Alfamart is the second biggest player in Indonesia’s convenience-store sector3. It plans to roll out new stores across the country over the next decade. Its shares sold off as the market took fright at Indonesia’s new government but we can see a clear and dependable growth path before it. Voltronic Power makes uninterruptible power supply units (PSUs). We expect demand for these to increase steadily as a new generation of data centres is built worldwide. Finally, BDO Unibank is the Philippines’ largest lender4. It is backed the Sy family, who we believe are great long- term stewards.
While we are broadly positive on the outlook for emerging markets, we recognise that there is likely to be ongoing volatility for as long as ‘top-down’ uncertainty – inspired by trade tariffs and geopolitical flux – remains at elevated levels. Valuations are certainly attractive and there remains plenty of domestically driven growth in the markets we favour. Our task is to block out the short-term noise to focus on the underlying quality, growth and stewardship of the companies we invest in.
[1] Source: FactSet as of 31 March 2025.
[2] Source: InfoEdge: Annual Report 2023-24.
[3] Source: Fitch Ratings Fitch Revises Alfamart's Outlook to Positive; Affirms at 'AA(idn)'.
[4] Source : BDO Unibank – Company Profile (as of 31 December 2024).
Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Named new investments disclosed relate to holdings with a portfolio weight over 0.5%. It is not a recommendation or solicitation to purchase or invest in any fund. Differences between the representative account-specific constraints, currency or fees and those of a similarly managed fund or mandate would affect results.
Download a PDF copy
Select Strategy update and/or Proxy voting to produce a report. You can then download a copy of the report by clicking on the button.
You can build a bespoke report for all our strategies on the full Quarterly update report.
Global Emerging Markets Leaders strategy update: 1 October - 31 December 2024
Emerging markets ended 2024 lagging developed markets for the second year in a row. Whilst the MSCI Emerging Markets Index returned 8.1% (USD, total return), developed markets, measured by the MSCI World Index were up 19.2%, driven by strong performance in the United States. Brazil (-29.5%) and Mexico (-26.8%) both had a tough year in 2024 but China, India and Taiwan all posted positive returns1.
Through the last quarter of 2024, markets had to contend with the re-election of Donald Trump and all the expected geopolitical noise that will come over the next four years, as well as the continuing strength of the US dollar. We remain focused on bottom-up stock picking which is at the core of our portfolio construction process and we will continue to seek out long-term growth opportunities regardless of who is the President in the White House.
We bought one new company during the quarter. We have built a position in Naver (South Korea: Communication Services), the leading South Korean internet search engine with a very strong market share. It was founded inside Samsung SDS before being spun out on its own in 1999. It is still run by the founder, Lee Hae-jin who has recently brought in a new management team which is aiming to return the company to a path of steady and profitable growth. One key aim for them is to use the stickiness of their search engine client base to drive increased e-commerce down the same channels. Their e-commerce business is the second largest in South Korea2. Naver’s attractive valuation presented a good opportunity to invest in a business that should achieve double-digit earnings growth each year.
We did not fully exit any positions during the quarter but trimmed several of our Chinese holdings. These included Inovance (China: Industrials) which was becoming expensive, and Ping An Insurance (China: Financials) and Hong Kong Exchanges and Clearing (Hong Kong: Financials) which were trimmed to control larger position sizes. We build our portfolios from the bottom up and any top-down views on countries are reflected through the position size which is risk-weighted according to our conviction in each country. China has a large and deep equity market but we fully recognise that companies both in mainland China and Hong Kong are required to operate within very strict regulations set by Beijing. As a result, we typically have lower position sizes in our Chinese holdings to reflect our more cautious approach. Some of the capital raised from these trims was used to add to Samsung Electronics (South Korea: Information Technology), which we continue to believe is a stock we can own for the next decade.
We continue to look for high-quality companies which we can buy at reasonable valuations. We believe that valuations in emerging markets are now at very attractive levels alongside long-term growth opportunities that we can back for the next decade. The team is planning many research trips for 2025 to seek out new investment opportunities and update our knowledge of existing holdings. We look forward to sharing more with you as the year progresses.
1 Source: MSCI Index Factsheets as at 31 December 2024. All data USD, total returns.
2 Source: External market research.
Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Named new investments disclosed relate to holdings with a portfolio weight over 0.5%. It is not a recommendation or solicitation to purchase or invest in any fund. Differences between the representative account-specific constraints, currency or fees and those of a similarly managed fund or mandate would affect results.
Global Emerging Markets Leaders strategy update: 1 July - 30 September 2024
Most of the quarter’s activity happened in September, as is often the case. It is in such moments, like the biggest market moves since 2009 in China and Hong Kong and rising geopolitical tensions in the Middle East, that we remain grateful for our long-term philosophy. It gives us the ability to step back in moments of such volatility and reminds us to focus on the more important, bottom-up drivers for the companies we own on your behalf.
Over the course of this quarter, we have sold out of two positions in China, unfortunately before the recent rally. The capital raised was mostly reallocated into other Chinese names where we had greater conviction. Estun Automation (China: Industrials) was a company we had sold on valuation concerns earlier, and when the share price fell sharply along with the rest of China, we added back into it earlier in the year. The top-down investment thesis of an ageing population needing more automation remains intact but financial risk had elevated to an extent whereby we quickly concluded it wasn’t necessarily the same business as the one we had owned previously. We allocated the funds into Inovance (China: Industrials), which operates in the same sector but with a more diversified product range. The company is looking to shift to a regional sales network to better cross sell products across their existing customer base and we feel we can access the same top-down growth driver of industrial automation but with a higher quality business. The other stock we exited in China was Kingmed Diagnostics (China: Health Care) which was a small remaining position which had already been sold down on regulatory fears.
We also sold Kotak Mahindra Bank (India: Financials). We have seen Kotak, and other banks, finding it harder to attract deposits that will allow it and the others to keep growing loans at a fair clip that warrants the valuations the bank is currently on. It used to be the case that public sector banks were so discredited that no depositor would want to risk their savings at one of these state-owned banks. But this sector has been really cleaned up, which is great for the Indian consumer but makes for a more difficult competitive environment for the private sector banks, including Kotak. With growth looking muted and residual concerns about management, we decided to sell our holding.
The only new position over the quarter was Regional (Mexico: Financials), a bank focused on small and medium-sized enterprise (SME) lending in Mexico. It has been growing market share in Nuevo Leon, its home region, and in the maquiladoras (foreign-owned factories) of Mexico that supply the US economy. Its bankers are rewarded on the quality of the loans rather than loan growth and if non-performing loans (NPL) in their portfolio tip over 1% then the bankers lose that year’s bonus. This ensures that the bank’s NPL ratio is 1.3% and the lowest in the country. Some 50% of SME loans are written in Mexico City and here Regional has 0.1% market share whereas it has 5% nationally, demonstrating how strong it is in Nuevo Leon.1 We expect a gradual and conservative approach to growth in Mexico City but can see a clear runway ahead and paying 1.5x price-to-book for a return-on-equity (ROE) of 23%2 seems attractive.
We continue to discuss our China holdings at length, especially in light of the recent market moves. But another area where we are doing a lot of thinking is Poland. Here we hold Allegro (Poland: Consumer Discretionary), Dino Polska (Poland: Consumer Staples) and Jerónimo Martins (Portugal: Consumer Staples), which is listed in Portugal but >50% of revenues are from its Biedronka business in Poland.3 They all experienced strong growth through 2022 and 2023 as inflation helped them increase profit margin but the opposite has now happened. Deflation in food prices and rising costs have squeezed profit margins considerably.
As always, we spend the bulk of our time continuing to better understand the quality attributes of the companies we invest in and finding similarly resilient ideas to add to the portfolio.
1 Source: Stewart Investors investment team and company data
2 Source: Bloomberg Finance L.P.
3 Source: Jerónimo Martins Annual Report 2023.
Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Named new investments disclosed relate to holdings with a portfolio weight over 0.5%. It is not a recommendation or solicitation to purchase or invest in any fund. Differences between the representative account-specific constraints, currency or fees and those of a similarly managed fund or mandate would affect results.
Global Emerging Markets Leaders Sustainability strategy update: 1 April - 30 June 2024
We have seen a continuation of geopolitical surprises throughout the quarter which have caused short-term volatility (rapid and unpredictable price fluctuations).
Claudia Sheinbaum was elected the first female President of Mexico with a large victory that her party now holds a two-thirds majority in both congressional houses and means it could make constitutional changes. India completed the largest democratic election in the world with a surprise vote removing Narendra Modi and the Bharatiya Janata Party’s absolute majority in the Lok Sabha (also known as the House of the People and the lower house in the Indian Parliament). The Nifty 50 (top 50 stocks by market capitalisation listed on the National Stock Exchange of India) rose the day before the election on the expectation that Modi would get over 400 seats. It then fell 7% when the news broke that he had lost his absolute majority before rising again in the days afterwards as the market decided Modi staying in power with a reduced majority was a positive for Indian democracy1. It is at times like this that we are thankful for our philosophy and process which focuses on the quality of individual companies over a long period of time.
We sold out of eight companies and only added one through the second quarter which is higher turnover than previous quarters. We sold Vitasoy (Hong Kong: Consumer Staples) after they changed their management team in Australia; but given the share price has fallen quite sharply it has been a frustrating position and we believe we can find better ideas elsewhere. We sold Amoy Diagnostics (China: Health Care) after a period of better performance. Whilst we still like the way the business is managed, the high financial performance generated in the healthcare sector means we have become worried about the regulatory environment stepping in to reduce those margins. Another Chinese position we sold is Foshan Haitian Flavouring & Food (China: Consumer Staples), a food flavouring and seasoning producer that has seen its operating profit margin reduce over the longer term and we don’t see a catalyst for them to recover.
We also sold Tech Mahindra (India: Information Technology) and Dabur (India: Consumer Staples) having bought into both in 2009. Tech Mahindra (known then as Satyam) and Dabur have delivered good performance since first bought. Whilst we still believe that they are good companies, valuations are becoming problematic. Tech Mahindra has been a great investment over the last ten years but we believe we have a better option for the next ten years in Tata Consultancy Services (India: Information Technology). Tech Mahindra has seen profit margins reduce and it is also expensive. Dabur is a soaps and detergents producer in India which has delivered successful financial results but we expect growth to be lower in the future. Valuations in India remain one of our biggest concerns and we have been trimming back our positions there including Marico (India: Consumer Staples) and Mahindra & Mahindra (India: Consumer Discretionary) due to valuations. We also sold Pigeon (Japan: Consumer Staples) as we lost confidence in the speed and extent of the evolution of the business which is facing rising challenges (headwinds) such as declining birth rates.
Finally we sold out of Banco Bradesco (Brazil: Financials) and Infineon Technologies (Germany: Information Technology). Infineon is a semiconductor designer and manufacturer mainly serving the automotive sector and it is moving into software solutions, but we feel there are better ideas elsewhere. Banco Bradesco was a mistake which we are rectifying by exiting the position. We underestimated the impact of Nubank (a financial technology bank, known as a neobank) on the country’s banking sector and Banco Bradesco is behind in providing more advanced digital banking services. To compete, the company would have to change substantially at a time when Brazil’s economy is looking uncertain.
The only new company we have purchased is Bidcorp (South Africa: Consumer Staples). It is a specialist logistics company focused on fresh and frozen foods with operations in 35 countries. They have a strong financials including low debt levels. We are hopeful that they will be able to improve diversity at the board level but the business has been well managed over the years and we are happy to build a position as they look to expand in less developed markets.
We have been selectively adding to some positions in technology companies where we took advantage of price movements to continue building a long-term position. We added to Samsung Electronics (South Korea: Information Technology) as we believe it is in the early stages of a memory cycle recovery. We also added to Globant (Argentina: Information Technology) which suffered as IT capital expenditure (capex) was postponed by several customers, but growth has held up better than we expected and we don’t see it as too expensive.
1 Source: Bloomberg
Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Named new investments disclosed relate to holdings with a portfolio weight over 0.5%. It is not a recommendation or solicitation to purchase or invest in any fund. Differences between the representative account-specific constraints, currency or fees and those of a similarly managed fund or mandate would affect results.
Proxy voting
Global Emerging Markets Leaders proxy voting: 1 January - 31 March 2025
Proxy voting by country of origin
Proxy voting by proposal category
During the quarter there were 45 resolutions from eight companies to vote on. On behalf of clients, we voted against five resolutions.
We voted against executive remuneration at Bank Central Asia because we believed it was excessive. (one resolution)
We voted against the election of two directors and an audit committee member at Samsung Electronics as we do not believe them to be truly independent. (three resolutions)
We voted against the election of the audit committee chair at Unicharm as we do not believe they are independent. (one resolution)
Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Proxy voting chart numbers may not add to 100 due to rounding. SHP means: Shareholder Proposal.
Global Emerging Markets Leaders proxy voting: 1 October - 31 December 2024
Proxy voting by country of origin
Proxy voting by proposal category
During the quarter there were 46 resolutions from seven companies to vote on. On behalf of clients, we did not vote against any resolutions.
Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Proxy voting chart numbers may not add to 100 due to rounding. SHP means: Shareholder Proposal.
Global Emerging Markets Leaders proxy voting: 1 July - 30 September 2024
Proxy voting by country of origin
Proxy voting by proposal category
During the quarter there were 77 resolutions from nine companies to vote on. On behalf of clients, we did not vote against any resolutions.
Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Proxy voting chart numbers may not add to 100 due to rounding. SHP means: Shareholder Proposal.
Global Emerging Markets Leaders proxy voting: 1 April - 30 June 2024
Proxy voting by country of origin
Proxy voting by proposal category
During the quarter there were 430 resolutions from 35 companies to vote on. On behalf of clients, we voted against 15 resolutions.
We abstained from voting on amendments to work systems for independent directors and board meeting procedures at Amoy Diagnostics as the company did not provide sufficient data on the proposed amendments. (two resolutions)
We voted against the appointment of the auditor at EPAM Systems, Estun Automation, Glodon, Sunny Optical Technology and Yifeng Pharmacy Chain as they have been in place for over 10 years and the companies’ have given no information on intended rotation. We believe rotating an auditor on a relatively frequent basis (e.g. every 5-10 years) helps to ensure a fresh pair of eyes are examining the accounts, and follows best practice. (five resolutions)
We voted against the proposed employee stock ownership plan at Midea as we believe non-executive director involvement could lead to conflict of interest and would not be in shareholders' interest. (three resolutions)
We voted against the recasting of votes for the supervisory council at RaiaDrogasil as we believe the principle of recasting votes for an amended slate is poor practice and would prefer the slate be resubmitted for voting. (one resolution)
We voted against the establishment of a supervisory council and cumulative voting at TOTVS as no detail on the candidates was provided. (two resolutions)
We voted against recasting and cumulative voting at WEG as this would allow the board to make changes without shareholder assessment or knowledge of candidates. (three resolutions)
We abstained from voting on requests for a separate board election and the election of a Supervisory Council position at WEG due to insufficient information and our preference for the current family stewards to remain in place. (two resolutions)
We voted against a shareholder proposal regarding board declassification at EPAM Systems as we do not deem it necessary for all directors to stand for election annually and believe this could destabilise the board by allowing excessive turnover. (one resolution)
Source for company information: Stewart Investors investment team and company data. This stock information does not constitute any offer or inducement to enter into any investment activity. Portfolio data shown is from representative strategy accounts of the strategy shown above. Proxy voting chart numbers may not add to 100 due to rounding. SHP means: Shareholder Proposal.
Portfolio Explorer
The information provided on this webpage does not constitute any investment advice or recommendation with regards to any investment product/services.
If you are unable to view the portfolio explorer, please re-open in Google Chrome, Edge, Firefox, Safari or Opera. IE11 is not supported.
For illustrative purposes only. Reference to the names of example company names mentioned in this communication is merely for explaining the investment strategy and should not be construed as investment advice or investment recommendation of those companies. Companies mentioned herein may or may not form part of the holdings of Stewart Investors. Holdings are subject to change.
Certain statements, estimates, and projections in this document may be forward-looking statements. These forward-looking statements are based upon Stewart Investors’ current assumptions and beliefs, in light of currently available information, but involve known and unknown risks and uncertainties. Actual actions or results may differ materially from those discussed. Readers are cautioned not to place undue reliance on these forward-looking statements. There is no certainty that current conditions will last, and Stewart Investors undertakes no obligation to correct, revise or update information herein, whether as a result of new information, future events or otherwise.
Source: Stewart Investors investment team and company data. Securities mentioned are all investee companies* from representative Asia Pacific All Cap Strategy, Asia Pacific & Japan All Cap Strategy, Asia Pacific Leaders Strategy, European All Cap Strategy, European (ex UK) All Cap Strategy, Global Emerging Markets (ex China) Leaders Strategy, Global Emerging Markets Leaders Strategy, Global Emerging Markets All Cap Strategy, Indian Subcontinent All Cap Strategy, Worldwide All Cap Strategy and Worldwide Leaders Strategy accounts as at 31 March 2025. *Assets that the strategies may hold which an active decision has not been made, and sustainability assessment does not apply, include cash, cash equivalents, short-term holdings for the purpose of efficient portfolio management and holdings received as a result of mandatory corporate actions. Holdings of such assets will not appear on Portfolio Explorer.
The Stewart Investors supports the Sustainable Development Goals (SDGs). The full list of SDGs can be found on the United Nations website.
Source for Climate Solutions and impact figures: © 2014–2025 Project Drawdown (drawdown.org). Source for Human Development Pillars: Stewart Investors investment team.
Source for climate solutions and human development analysis and mapping: Stewart Investors investment team. Contributions are defined by the team as demonstrable contributions to any solution, either direct (directly attributable to products, services or practices provided by that company), or enabling (supported or made possible by products or technologies provided by that company).
Investment terms
View our list of investment terms to help you understand the terminology within this website.
Fund data and information
Key documents
Strategy and fund name changes
As of end of 2024, please note that Stewart Investors strategies and the Funds within the UK First Sentier Investors ICVC, First Sentier Investors Global Umbrella Fund plc (Irish VCC) and First Sentier Investors Global Growth Funds (Singapore Unit Trust) have been renamed. Please refer to our note via the link below for further information.
Investment involves risks. Past performance is not indicative of future performance. Refer to the offering documents of the respective funds for details, including risk factors. Investors may not get back the full amount invested.
This website is issued by First Sentier Investors (Hong Kong) Limited and has not been reviewed by the Securities and Futures Commission of Hong Kong. First Sentier Investors, FSSA Investment Managers, Stewart Investors, RQI Investors and Igneo Infrastructure Partners are the business names of First Sentier Investors (Hong Kong) Limited.
Copyright © 2025 Stewart Investors.