Latest / Best of Business / Sam Dickie: Fisher Funds expert on the success of Tencent

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Sam Dickie: Fisher Funds expert on the success of Tencent · Best of Business

• 0:09
  Speaker 1: You're listening to a podcast from News Talk st B.
• 0:12
  Speaker 1: Follow this and our wide range of podcasts now on iHeartRadio.
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  Speaker 2: While everyone's obsessing over the US tech giants, the best
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  Speaker 2: performing large tech company globally over the last year is
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  Speaker 2: actually ten Cent, which is a Chinese company a lot
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  Speaker 2: of people have never heard of. To talk us through this,
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  Speaker 2: we have Sam Dicky from Fisher.
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  Speaker 3: Funds with us.
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  Speaker 2: Hey, Sam, Hey, Now ten Cent of the guys who
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  Speaker 2: do the games, don't.
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  Speaker 3: They that's right gaming that Their primary business though, is
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  Speaker 3: via their we chat app, so it's the so called
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  Speaker 3: super app. So they've got sort of one point four
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  Speaker 3: billion users, so a quarter of all Internet users globally
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  Speaker 3: use the app every day and you can do everything
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  Speaker 3: from paybills, to invest a shop, to hail cabs, to
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  Speaker 3: book doctors appointments, and to play games.
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  Speaker 4: They're very big and global gaming, so it's super sticky.
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  Speaker 3: So it's got this kind of massive captive audience that
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  Speaker 3: use it for hours every day, and it can drive
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  Speaker 3: revenue via payments, shopping, advertising, etc.
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  Speaker 2: And should investors care about it?
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  Speaker 4: Yes? Absolutely. I mean it's a trillion dollar behemoth that
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  Speaker 4: many haven't heard of, and.
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  Speaker 3: It's it's a as I said, its app is very
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  Speaker 3: very sticky. But it's been quite a saga, I've got
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  Speaker 3: to say, because for years you could avoid the low
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  Speaker 3: quality state owned enterprises like the bloated banks and steel
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  Speaker 3: companies in China and just invest in fabulous private companies
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  Speaker 3: like ten Cent.
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  Speaker 4: Too, Ali Barber.
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  Speaker 3: But then you might remember Jack Ma, the charismatic farm
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  Speaker 3: founder of Ali Baba.
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  Speaker 4: Reportedly got too big for his boots.
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  Speaker 3: He criticized Chinese financial regulator publicly, and that kick started
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  Speaker 3: a rolling series of crackdowns on private companies and tycoons.
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  Speaker 2: Has China carried on with that attitude of the crackdowns
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  Speaker 2: or have they learned from it?
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  Speaker 1: No?
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  Speaker 3: Well, so that did kickstarter sort of a three year
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  Speaker 3: seventy five percent under performance by Chinese tech stocks versus
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  Speaker 3: US tech stocks, but that has started to thaw so
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  Speaker 3: sort of late twenty three and then into twenty four,
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  Speaker 3: Beijing started to roll out new measures to support tech innovation.
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  Speaker 3: And then the major turning point was in fear of
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  Speaker 3: this year and President she hosted a high profile tech
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  Speaker 3: symposium and who should be on stage with him but
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  Speaker 3: Jack Ma, which is very symbolic and a clear sign
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  Speaker 3: that the crackdown was completely over, and China tech is
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  Speaker 3: the best performing tech sector globally by far over the
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  Speaker 3: past twelve months. And like you said here the ten
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  Speaker 3: cents up sort of sixty percent, much more than a
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  Speaker 3: video and even meta.
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  Speaker 2: So where does this put us in terms of if
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  Speaker 2: we look at the US tech companies versus the Chinese
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  Speaker 2: tech companies, who's winning this one?
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  Speaker 3: Yeah, that the US China tech arms race, it really
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  Speaker 3: is at fever pitch at the moment. So first of all,
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  Speaker 3: take a step back before the President She's symposium and
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  Speaker 3: sort of loving with Jack Maer. Remember we had that
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  Speaker 3: the deep seek moment that you and I talked about
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  Speaker 3: in January when a Chinese AI company showed the world
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  Speaker 3: it could allegedly build AI models at a fraction of
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  Speaker 3: the cost of the US players, and that drove kind
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  Speaker 3: of a ton of enthusiasm around China made AI chips,
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  Speaker 3: China made AI equipment, China made AI models, and let's
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  Speaker 3: not forget China now leads the US now and things
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  Speaker 3: like drones, electric vehicle manufacturing efficiency, and autonomous vehicle software.
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  Speaker 4: So there's three companies in China now that have.
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  Speaker 3: Cracked the critical level for full self driving riddle. So
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  Speaker 3: the other thing that's really important is China is miles
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  Speaker 3: ahead on the critical bottleneck of power generation required to
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  Speaker 3: power this sort of AI tech arms race. So take
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  Speaker 3: a step back ten or fifteen years, and both China
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  Speaker 3: and the US had about the same power generation capacity
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  Speaker 3: of about a thousand gigawatts. Today China has three times
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  Speaker 3: as much power capacity as the US. But the US
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  Speaker 3: isn't a frenzy too. I'm not sure if you saw recently,
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  Speaker 3: but Trump is on record gushing about Jensen Wang, the
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  Speaker 3: Nvidio CEO, saying, now these learned the facts of life
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  Speaker 3: about Jensen, He's untouchable, and he's tried to rename artificial
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  Speaker 3: intelligence because he doesn't like anything artificial. He's tried to
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  Speaker 3: rename it genius intelligence. So it's all going just a
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  Speaker 3: little bit frenzied.
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  Speaker 2: Okay, So what does this mean for investors?
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  Speaker 3: It is a reminder that this fabulous companies all around
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  Speaker 3: the world, often the ones you haven't heard about. It's
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  Speaker 3: also a reminder that when you do invest in China,
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  Speaker 3: and you and I have talked about China a lot,
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  Speaker 3: it's not always a stock market that's driven by fundamentals
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  Speaker 3: it is massively policy driven, so you really do have
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  Speaker 3: to read the tea leaves and that's why those sort
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  Speaker 3: of symbolic things like she getting mar up on stage
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  Speaker 3: is really critical to watch.
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  Speaker 2: Yeah, very interesting. Thank you so much. Sam has always
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  Speaker 2: appreciate your expertise at Sam to Quia Fisher Funds.
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