Confident: Chetan Sehgal has taken over the reins at the trust
It is all change at Franklin Templeton’s emerging market investment operations based in Singapore, which manages some $50billion (£35billion) of assets.
Out through Franklin’s revolving doors have gone both Dr Mark Mobius and Carlos Hardenberg, renowned emerging market investment managers. In has come Manraj Sekhon from Fullerton Fund Management as chief investment officer.
All this shuffling at the top has been accompanied by a greater concentration of investment resources in Singapore.
The changes have had ramifications for Templeton Emerging Markets, the country’s longest established investment trust managing assets in the world’s developing countries.
Mobius, who managed the £2.3billion trust for more than 26 years before latterly becoming an adviser to the fund, will no longer have an input, having decided to put his boots up and retire.
Hardenberg, who succeeded Mobius at the helm in October 2015, left for pastures new last month. Up has stepped Chetan Sehgal, senior research analyst, to take over the trust’s running, an individual with 22 years’ experience of watching emerging markets.
In London last week to update financial advisers and the media about the trust and introduce himself as the new face of Templeton Emerging Markets, Sehgal was in confident mood.
Risks: The trust’s 9 per cent exposure to Russia has been hit by America’s decision to impose sanctions on a number of Russian tycoons and businesses
Although he acknowledged that the loss of Mobius – often dubbed ‘Mr Emerging Markets’ – and Hardenberg were big blows, he said that it was very much business as normal.
‘There will be no significant changes in investment philosophy,’ he reassured listeners. ‘This trust’s management is about we rather than I,’ emphasising the fact that behind him is a long-established team of analysts and country specialists who spend their working lives identifying investment opportunities.
It has been a baptism of fire for Sehgal, as the trust’s 9 per cent exposure to Russia has been hit by America’s decision to impose sanctions on a number of Russian tycoons and businesses.
Although some Russian positions have been reduced, the trust continues to hold stakes in energy giant Gazprom, web search engine Yandex, internet company Mail Ru and mining firm Norilsk Nickel. Sehgal talks of ‘collateral’ damage only but is keeping a watchful eye on developments.
Big holdings include Chinese internet giants Alibaba and Tencent
He says that with the notable exception of Russia, most emerging markets remain in a ‘sweet spot’. He says stronger commodity prices have been good news for many natural resource based companies operating in emerging markets – Peruvian mining giant Buenaventura is a top ten holding.
He is also excited by the technology revolution that is taking place in countries such as China. Indeed, technology is the biggest theme within the trust’s portfolio, accounting for nearly a third of assets. Big holdings include Chinese internet giants Alibaba and Tencent.
Technology is also helping Sehgal change the way the trust is managed. In the past, Mobius was renowned for circumnavigating the globe to meet company bosses.
Now, a lot of key financial information can be obtained via the internet which means Sehgal will spend more time behind his desk in Singapore. Yet seeing company management will remain part of his job. ‘A lot of the companies pass through Singapore,’ he says. ‘It is vital to meet them.’