5 year low

Chinese stocks have now fallen to 5 years low based on the 3 major market indices measuring their performance. Judged in dollar terms the Chinese GDP has started to decline for the first time over the last 30 years. A disappointing recovery post-Covid, overleverage leading to a property crisis, government interference in the private sector and the geopolitical powerplay with the US are the main reasons making foreign investors shy away. As value investors we continue to stay on the sidelines as it takes more than a low valuation for Chinese stocks to reinitiate investor’s appetite.