South-East Asia - Conglomerates and Specialists

In emerging markets, and South-East Asia is no exception, bank, real estate and utility stocks tend to dominate market cap rankings, as shown in the country themes for Indonesia, India, Singapore, the Philippines and Malaysia

Setting those sectors aside, this selection brings into focus the large cap listings of conglomerates, diversified across multiple industry segments, and of unique specialists, defining world-leading industries in IT outsourcing and in healthcare

The conglomerates are a defining feature of the Asian markets and closely knit relations between finance, manufacturing and services - and between the conglomerates themselves - create a maze of overlapping controlling stakes

Diversified conglomerates combine manufacturing stakes with finance and real estate

• Jardine Cycle & Carriage - listed in Singapore (240 000 employees) - with a controlling stake in DFI Retail Group , a major East and Southeast Asian retailer (218 000 employees), ignored by OTC investors
• PT Astra International - based in Indonesia (133 000 employees) - with a controlling stake in PT United Tractors , a provider of coal mining services and heavy equipment rentals (35 000 employees)
• Ayala Invalid tag asset - based in the Philippines (60 000 employees) and ignored by OTC investors
• and Wilmar International - based in Singapore - stands out as one of Asia's leading agribusiness groups (100 000 employees)

Industrial conglomerates are a defining feature of the Indian stock exchange with

• Mahindra & Mahindra (260 000 employees)
• Larsen & Toubro (50 000 employees)
• overshadowed by the energy and telecom behemoth - not listed on US exchanges - Reliance Industries (390 000 employees)

In a radical departure, specialized Indian firms have achieved worldwide recognition by carving out unique niche industries

• in IT consulting and outsourcing services - with market leaders Infosys (336 000 employees) and Wipro (250 000 employees)
• in generic pharmaceutical products - with Dr. Reddy's Laboratories (25 000 employees) - and privately controlled Serum Institute of India (SII), the world's largest vaccine manufacturer

SEA Ltd. a tech gaming and e-commerce conglomerate, listed in Singapore with a $22 billion market cap, exposed to the travails of China's Tencent , its minority owner (21.3% in Jan. 2022 and 18.7% as of mid-2023), remains volatile in the medium term

Invesco S&P Emerging Markets Low Volatility ETF  benchmarks the theme, highlighting the potential of individual stocks buoyed by the economic expansion of the South-Asian region