East Online Investments: India and Singapore

At the beginning of last month, India’s internet retail industry encountered substantial profits. This put it in the top three web-using region, boasting 74 million users. This is an increase of 31 percent since 2012.

This has led to an increase in India of online shopping, escalating the country’s e-commerce market by 66 percent last year, with a value of $16bn. Not only is this figure huge, but compared to the rate of the rest of the world – which stood at 18.3 percent – it is even more impressive. As well, within the next decade, it is expected to be valued at a staggering $56bn.

In addition, according to Snapdeal (an Indian e-commerce site), is planning to sell properties online. The idea is to offer affordable housing, in conjunction with the Tataconglomerate. This is the first such endeavor that India has encountered. When the project starts, around a thousand units will be offered in cities including: Ahmedabad, Bangalore, Chennai, Mumbai and Pune.

Moving on to Singapore investments, a recent US-based report valued a gaming company at $1bn – higher than other US tech companies. This is indicative of Singapore’s local tech industry advancing with additional venture capitalist investments and acquisitions over the last few years. Singapore was ranked 27th on the list of the top Internet companies by market from the World Startup Report. Indeed, it appears that South East Asia is one of the “fastest growing regions in the world,” vis-à-vis tech market. As such, Singapore’s gaming industry has been hailed as a “milestone” for the country’s start-up ecosystem, by CEO of the National Research Foundation, Professor Low Teck Seng.

Singapore has what to learn from India in the fiscal realm. According to Prime Minister Lee, India has been proving how social media technology can be used to enhance the quality of government, in particular through the MyGov platform. For more information on this endeavor, click here.

Asian Real Estate Investors Take Interest in Overseas Markets

Asian real estate investors are venturing beyond regional markets to OECD countries and other areas in the West, according to a recent study by Colliers International.

Outbound real estate investment from Asia has climbed from $1 billion in the early 2000’s to more than $30 billion in 2013. This is a result of a surge in global liquidity, as well as several other “pull” and “push” factors, according to CEO, Asia at Colliers International Piers Brunner.

Pull factors include the higher yields available in foreign markets, as well as strong economic growth potential and first world country real estate environments. Meanwhile, governments in Mainland China, Hong Kong and Singapore are pushing investors in an effort to slow local real estate markets by loosening overseas investment restrictions.

According to John Marasco, Colliers International’s Managing Director of Capital Markets and Investment Services in Australia, the Chinese investors are contributing greatly to the Australian real estate market.

“Chinese buyers alone are currently spending around $5.9 billion a year on Australian property (both residential and commercial),” he said. “The strong performance of Australia’s property markets suggest this demand will continue to grow across a range of assets.”

Director of Capital Markets and Investment Services, Asia, Terence Tang added: “We believe the emerging trend will see more outbound investors taking on additional risks in non-traditional property sectors, such as hotels, and to commit to value-adding schemes, including conversion and development opportunities, in the secondary locations of gateway cities, where prices are more attractive than in traditional core locations.”

Former Goldman Sachs Employees to Launch Asia-Focused Hedge Fund

According to anonymous sources, three former managing directors of Goldman Sachs’ Japan business are planning to launch a multi-strategy hedge fund in Asia next year.

Koji Gotoda and Takayuki Kasama’s  fund, called Golvis Investment Pte, will invest in asset classes with an initial focus on Japan. According to one of the sources, hedge funds that focus on Japan generally trade stocks. Therefore, the new team of former GS employees with the ability to invest in multiple asset classes will stand out.

Peter Douglas of GFIA Pte explained: “The pedigree of the principals will guarantee they at least get a good hearing from prospective allocators. After many years of slow death or exile for the Japanese hedge fund industry, it does feel as if the industry, like the country, could be on the verge of a renaissance.”

According to Bloomberg News, Gotoda will present his plans at the annual Goldman Sachs Asia Hedge Fund Symposium in Tokyo.

Mirae Asset Global On Emerging Markets

A number of major global investment firms are choosing emerging markets in an effort to recover from the latest financial slump. Mirae Asset Global, a firm with $58 billion under management, explained that emerging economies are the hub of global output. The leading market is China, they added.

“We are positive on equities for 2013, although not outrightly bullish,” Mirae analysts wrote in a client report last week. “We believe that the earnings downgrade cycle has ended… and that economic recovery will be slower than in previous cycles as the economies of China and India work to correct their imbalances and are restricted in their ability to pump prime growth.”

The report added, “We are identifying pockets of overvaluation in consumer sectors, and now favor early-cycle consumer discretionary and financials over staples. Industrials and health care stand out as combining structural growth, government support and reasonable valuation.”


Asia Hopes to Boost Trade and Investment

The 10th Asia-Europe Finance Ministers Meeting, to take place today, will address a recent grievance brought forth by Asian firms, according to Somchai Sujjapongse, the director-general of the Fiscal Policy Office.

The companies have asked Europe to simplify processes and allow them to acquire or merge with other European businesses. This issue is only a small part of the meeting’s main topic; stimulating trade and investment flows between the two regions.

Sujjapongse explained that while multinational companies from Europe have extensive history of investing in Asia, Asian investment in the region remains limited. He called on Europe to promote investment from various enterprises.

“There are some obstacles; for instance, Europe should make it much easier for Asian firms to take over, merge with or form joint ventures with local European firms.”