In this piece, we will take a look at the 12 best Asian stocks to buy now. To jump ahead to the top five stocks in this list and skip all the latest news about Asia, its economy, and its financial markets, take a look at 5 Best Asian Stocks To Buy Now.
Courtesy of its population and a late shift towards industrialization, Asia is the economically fastest growing region in the world, with big businesses, large governments, and sizeable middle class populations eager to spend money and grow the economy. The rise of China, in just a couple of decades, after its contract manufacturing economic model enabled its rise as the world's largest economy, has shaped the global world order in ways that might be considered surprising during the late 1990s. At the same time, globalization and trade have produced groups of countries in Southeast and East Asia that have surpassed the economic output of all if not most European nations.
For instance, consider our list of the world's largest economies ranked through currency adjustments. Out of the five biggest economies in the world, three are Asian countries, while out of the remaining, one is the U.S. and the other is Germany. GDP data from the World Bank shows that Asian countries accounted for 42% of global GDP in PPP terms, cementing the fact that the continent is one of the most important regions for global stability. High industrial growth in Asian countries, notably India and China, often drives entire industries such as metals and minerals. The Asian growth spurt is helped by the fact that the continent is significantly larger in terms of area than Europe, and its working age population has grown at some of the fastest rates in the world. Asia also covers 45 million square kilometers in area, which is more than twice the area of Europe and the U.S. combined.
Therefore, some of the world's biggest industries such as construction and air travel are predicted to see faster growth in Asia than in either North America or Europe. Starting from real estate, the global real estate industry was valued at an unbelievable $28 trillion in 2021, and over the course of the next ten years, the sector is expected to grow at a compounded annual growth rate (CAGR) of 5.3% to be worth $48 trillion in 2031. Within this industry, which is made of all of the world's priciest property markets, geographically, Asia Pacific was the biggest sector as it accounted for two fifths of the total industry value.
Air travel, on the other hand, was worth $531 billion in 2021 and is slated to grow to $635 billion by 2030 at a CAGR of 3.10%. Just like real estate, Asia Pacific also dominates the air travel industry since it accounts for 47% of the total global spending. Shifting our focus to the global information technology and automotive industries, most, if not all, of Apple Inc. (NASDAQ:AAPL)'s iPhones are made in China, and big Japanese firms such as Toyota Motor Corporation (NYSE:TM) and Sony Group Corporation (NYSE:SONY) command strong market shares in their industries. Asia also includes some of the most technologically advanced nations in the world, and its rapid modernization in key sectors such as space exploration and semiconductor fabrication has placed countries and regions such as Japan, South Korea, and Taiwan at the top of the global technology food chain. South Korea is the world's second highest spender in GDP percentage terms on research and development, and five countries in our list of the 20 Most Advanced Countries in the World in 2023 are Asian.
On the economic front, Asian countries vary in their performance. South Korea, known for its mega business conglomerates and high technology companies, was another developed economy that grew in the third quarter after U.S. data broke two year growth records. Data from the Korean central bank, Bank of Korea, revealed that the East Asian nation's economy grew by 0.6% during the third quarter, which was accompanied by a 2.5% growth in gross domestic income (GDI). At the same time, the business sentiment of Korean firms, such as the business conglomerate Samsung Electronics Co., Ltd. (LON:SMSN.L), remained consistent among responses by manufacturing and service sector firms. As a whole, out of the 3,165 companies surveyed by the Korean central bank, most remained pessimistic about the future amid low readings for the Business Survey Index (BSI) for the manufacturing and non manufacturing sectors.
However, as the Korean economy grows, the property markets of China and Hong Kong continue to show signs of trouble. Home prices dropped in China for the third consecutive month in September, as realtors worried that despite a drop in policies that stimulated the price reduction, the demand for homes did not increase. The low demand was clear as property sales by floor area in China tanked by 19.77% annually in September after witnessing a 23.95% drop in August. Similarly, Asia's business and shipping hub Hong Kong is still reeling from an exodus of some the wealthiest members of its population, as it seeks to introduce lower property stamp duties and two year visas for graduates from the world's top 100 universities that have more than three years of working experience.
With Asia remaining as diverse as ever, we decided to look at some top Asian stocks to buy based on hedge fund sentiment. The top three stocks in this list are Alibaba Group Holding Limited (NYSE:BABA), Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), and JD.com, Inc. (NASDAQ:JD).
12 Best Asian Stocks To Buy Now
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Our Methodology
To make our list of the best Asian stocks to buy, we first compiled the 40 most valuable Asian companies that are traded on the NASDAQ and NYSE stock exchanges. Then, the number of hedge funds that had bought their shares as of June 2023 was determined through Insider Monkey's database of 910 hedge funds, and the top Asian stocks to buy were selected.
H World Group Limited (NASDAQ:HTHT) is a Chinese hospitality firm that manages hotels in more than a dozen countries. The firm shared a crucial set of results in October 2023 as it provided insight into China's economic recovery after its zero COVID policies. H World Group Limited (NASDAQ:HTHT) 's third quarter financials saw the firm open 545 new hotels, grow its revPAR to 132% of 2019 levels in September, and post an improved occupancy rate.
During this year's second quarter, 31 out of the 910 hedge funds part of Insider Monkey's database had held a stake in H World Group Limited (NASDAQ:HTHT). Just like Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), Alibaba Group Holding Limited (NYSE:BABA), and JD.com, Inc. (NASDAQ:JD), it is a top Asian stock to buy now.
Sony Group Corporation (NYSE:SONY) is a diversified Japanese consumer electronics, media, and entertainment company. It is currently bracing for holiday season sales for products such as the PlayStation 5, and management believes that this season might be one of the strongest in hits history as a great product coupled with a robust supply chain set the console up for strong market performance.
As of June 2023, 31 out of the 910 hedge funds tracked by Insider Monkey had invested in the company. Out of these, Sony Group Corporation (NYSE:SONY)'s largest shareholder is Ken Fisher's Fisher Asset Management as it owns 5.5 million shares that are worth $503 million.
KE Holdings Inc. (NYSE:BEKE) is a Chinese real estate company headquartered in Beijing, China. Despite a slowdown in the Chinese real estate sector, the firm has done well financially by beating analyst EPS estimates for all four of its latest quarters and securing a Strong Buy average share price rating. Analysts have also penned in a $9 share price upside based on the average share price target.
Insider Monkey dug through 910 hedge funds for their Q2 2023 shareholdings and found that 36 had bought and owned KE Holdings Inc. (NYSE:BEKE)'s shares. Lei Zhang's Hillhouse Capital Management is the firm's biggest hedge fund investor courtesy of its $531 million stake.
Baidu, Inc. (NASDAQ:BIDU) is a Chinese internet firm that operates social media and other associated platforms. Its shares are also rated Strong Buy on average and analysts have priced in a sizeable $67 share price upside based on the average share price target of $175.33. However, its October 2023 AI event failed to impress Goldman Sachs and JPMorgan, as they cut the price target to $181 and $185 from $197 and $200, respectively.
By the end of 2023's June quarter, 36 hedge funds among the 910 part of Insider Monkey's research were the firm's investors. Baidu, Inc. (NASDAQ:BIDU)'s largest shareholder among these is John W. Rogers' Ariel Investments as it owns $377 million worth of shares.
Yum China Holdings, Inc. (NYSE:YUMC) is a Chinese fast food company that operates KFC, Pizza Hut, and other restaurants. It is set to release third quarter earnings on October 31st, and the shares saw positive price action in September 2023 after it revealed a long term plan that outlined 20,000 potential stores by 2026.
For their second quarter of 2023 investments, 37 out of the 910 hedge funds surveyed by Insider Monkey had bought Yum China Holdings, Inc. (NYSE:YUMC)'s shares. Guardian Capital's GuardCap Asset Management is the biggest shareholder through its $514 million stake.
ICICI Bank Limited (NYSE:IBN) is an Indian regional bank headquartered in Mumbai, India. The bank is currently increasing its services for the Indian diaspora in Canada, and it recently introduced a mobile banking application that will enable them to send money from any bank account to India.
As of June 2023, 37 out of the 910 hedge funds profiled by Insider Monkey had held a stake in the bank. ICICI Bank Limited (NYSE:IBN)'s largest stakeholder in our database is Rajiv Jain's GQG Partners courtesy of its $1.4 billion investment.
HDFC Bank Limited (NYSE:HDB) is another large Indian bank, and it has close to two hundred thousand employees. Its shares came under a bit of stress in September 2023, as Nomura downgraded the share rating to Neutral from Buy and slashed the share price target to INR1,800 from INR1,970.
Insider Monkey scoured through 910 hedge fund portfolios for their Q2 2023 shareholdings and found that 38 were HDFC Bank Limited (NYSE:HDB)'s shareholders. Out of these, the biggest shareholder is Andreas Halvorsen's Viking Global as it owns 9.3 million shares that are worth $649 million.
Alibaba Group Holding Limited (NYSE:BABA), HDFC Bank Limited (NYSE:HDB), Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), and JD.com, Inc. (NASDAQ:JD) are some top Asian stocks to buy according to hedge funds.
