Artisan Partners Asset Management Inc. · NYSE:APAM
Artisan Partners Asset Management — Investor Presentation (2024)
25 slides from Artisan Partners Asset Management's investor presentation, Dec 5, 2024
Slide 1: Outsized Opportunities in a Decoupling World
Outsized Opportunities in a Decoupling World Tiffany Hsiao, Portfolio Manager | Artisan China Post-Venture Strategy For Institutional Investors Only—Not for Onward Distribution
Slide 2: Agenda
Agenda China’s Edge in a De-globalized World The Decoupling Playbook Taiwan: the Bilateral Winner Energy: a Race to Self-Sufficiency Mitigating Risk: Avoiding Politically Sensitive Industries Q&A ARTISAN PARTNERS 1
Slide 3: 1. Expanding Economy
C H I N A’S E D G E I N A D E - G LO B A L I Z E D W O R L D 1. Expanding Economy China remains the second-largest economy and continues to grow 2X faster than the US Country Rank by GDP Country Rank by GDP Growth US Trillions YoY % China, $17.7 Trillion US, $28.2 Trillion 8.00% 6.7% Germany, $4.4 T
Slide 4: 2. Large Domestic Consumer Base
C H I N A’S E D G E I N A D E - G LO B A L I Z E D W O R L D 2. Large Domestic Consumer Base China’s economy has multiple growth engines, including its 1.4 billion consumers Income Bands by % of Population 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% US Dollars Earned Per Day Germany Poor <$2 UK Low
Slide 5: 3. Oversupply of Talent
C H I N A’S E D G E I N A D E - G LO B A L I Z E D W O R L D 3. Oversupply of Talent China produces 4X more STEM graduates than the US, a notable advantage in the tech arms race International patents filed in China surpassed applications received from the US in 2021 Annual STEM Graduates Worldwide
Slide 6: 4. Outsized Upside for Innovative Companies
C H I N A’S E D G E I N A D E - G LO B A L I Z E D W O R L D 4. Outsized Upside for Innovative Companies China Post-Venture Strategy’s estimated 2025 ROE is 20.0% compared to14.3% for the MSCI China All Shares Index 30 25 India 20 U.S. Circles = CPV Portfolio Holdings 2025e PE ratio : ROE = 0-10% 15
Slide 7: Decoupling Play #1: Taiwan
Decoupling Play #1: Taiwan
Slide 8: Taiwan: A Key Beneficiary of the US-China Decoupling
THE US-CHINA DECOUPLING Decoupling Trends Expand the Taiwanese Tech Industry’s P L AY B O O K Addressable Market Taiwan: 92% of advanced semiconductors are made in Taiwan Taiwan’s largest trading partners are China and the US, accounting for 22% and 17% of A Key total trade respectively Benefici
Slide 9: Taiwan's Equity Market Re-Rates with AI Demand
THE US-CHINA DECOUPLING AI Growth Drove Record Highs for Taiwan’s Stock Market P L AY B O O K ChatGPT’s launch spurred AI tech spending of $20 billion in 2023 AI tech demand is expected to increase 3X in 2024 Taiwan’s Equity Market Cumulative Total Return 2 Years Ending March 2024 Re-Rates with
Slide 10: Taiwan Stock Idea: Asia Vital Components
THE US-CHINA DECOUPLING Critical Components for Semiconductors: Cooling Solutions P L AY B O O K AVC is an industry leader with a vertically-integrated total solution Taiwan High performance computing > power consumption > heat generation = > cooling needs The market for server cooling solut
Slide 11: Decoupling Play #2: Energy Self-Sufficiency
Decoupling Play #2: Energy Self-Sufficiency
Slide 12: The Race to Create a Self-Sufficient Energy Ecosystem
China’s Renewable Efforts are Accelerating THE US-CHINA In less than a decade clean energy usage has more than doubled in China and is now on par with the US DECOUPLING P L AY B O O K The Race Total Clean Energy Consumption for the US and China to Create a 25 Self-Sufficient 20 Energy 15 Ecosystem
Slide 13: A Smart and Resilient Grid is Critical for Renewable Adoption
THE US-CHINA Transferring and Disseminating Clean Energy is Complex DECOUPLING Smart grids are required to balance the intermittent power generation across decentralized geographies P L AY B O O K and across different sources of energy A Smart and Resilient Grid is Critical for Renewable Adoption
Slide 14: Power Grid Capex Will Accelerate
Global Spend on the Power Grid Market is ~$290B; China Accounts for 31% THE US-CHINA DECOUPLING of that Capex P L AY B O O K 2023 jumpstarted a multi-year upcycle for the power grid industry with growth expectations of 8% Power Grid for 2023-2025 The acceleration is driven by: Capex Will 1) po
Slide 15: Energy Self-Sufficiency Stock Pick: Sieyuan Electric
Sieyuan leads the market in smart power grid solutions THE US-CHINA DECOUPLING The Company provides hardware and software solutions to power grid sub-stations P L AY B O O K It is the largest privately-owned grid equipment manufacturer in China and operates in over 80 countries >40% earnings C
Slide 16: Decoupling Play #3: Mitigating Risks
Decoupling Play #3: Mitigating Risks
Slide 17: Certain Industries Are Less Exposed to Targeting
THE US-CHINA Corrosive Foreign and Domestic Policy has Disrupted Chinese Industries DECOUPLING P L AY B O O K Certain Sectors, However, Remain Relatively Insulated In the past 5 years, the US has taken action against over 1,000 Chinese companies in an effort to stymie their Certain competitive pro
Slide 18: Risk Mitigation by Industry: Biopharma
THE US-CHINA Demand for World-Class Drugs Is Agnostic to Global Politics DECOUPLING P L AY B O O K In 2023, Chinese biopharma companies lead deal activity globally at $43 billion China’s share of the biopharmaceutical market has expanded from 10% to 27% in the last 10 years Risk Mitigation by Mo
Slide 19: Biopharma Stock Idea: Innovent Biologics
THE US-CHINA Strong Arsenal of Proven Drugs in Diverse Product Lines DECOUPLING P L AY B O O K Innovent is well-positioned to Capture the GLP-1 Craze 2nd largest Chinese biopharma company with deep R&D and a robust pipeline Biopharma The company’s market-leading blockbuster PD-1 now generates ~$
Slide 20: Outsized Opportunities in a Decoupling World
Outsized Opportunities in a Decoupling World China’s Edge in a De-globalized World 1. Expanding Economy 2. Large Consumer Base 3. Oversupply of Talent The US-China Decoupling Playbook Taiwan Stock Idea Asia Vital Components II 3017 TT II $6.3 bn market cap Self-Sufficiency Stock Idea Sie
Slide 21: Questions?
Questions?
Slide 22: Learn more
Learn more We invite you to learn more Tiffany Hsiao and the China Post-Venture Strategy at Artisan Partners. Please contact us by e-mail at: CPVinfo@artisanpartners.com ARTISAN PARTNERS 21
Slide 23: Investment Results (USD)
Investment Results (USD) Annual Returns Source: Artisan Partners/MSCI. Past performance does not guarantee and is not a reliable indicator of future results. Important information on the performance calculation is described in the Notes and Disclosures section. Gross- and net-of-fees performance sho
Slide 24: Notes and Disclosures
Notes and Disclosures This section of this presentation contains information important to a complete understanding of the material presented. Please review it carefully. Artisan Partners Limited Partnership (APLP) is an investment adviser registered with the U.S. Securities and Exchange Commission (
Slide 25: Notes and Disclosures
Notes and Disclosures Portfolio Holdings: For the purpose of determining the portfolio's holdings, securities of the same issuer are aggregated to determine the weight in the portfolio. Holdings information is not intended to represent or predict portfolio investment performance or as a recommendati
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