Thailand’s Government Pension Fund is considering to increase its equity investments in China and India, where the rise of companies focusing on new technologies and the environment may provide high potential returns.
Chinese producers of microchips and renewable-energy equipment and Indian IT firms and drug makers are among the top stock candidates for the 1.1 trillion baht ($33 billion) state fund, according to GPF secretary-general Srikanya Yathip.
“Our fund continues to grow in such a big way that it’s very hard to find good investments in the domestic market,” Srikanya said in a phone interview with Bloomberg.
“Developing markets such as China and India should offer the outlook for better returns because of the resiliency of their economies during the pandemic.”
Chinese and Indian stocks would help GPF diversify its portfolio where most of its investments are in developed countries such as US and Europe.
Earlier the Thai Cabinet last month approved a proposal to raise the ceiling on GPF’s foreign assets under management to 60 per cent of the total, up from 40 per cent.
Final approval by the finance ministry is likely in the latter half of this year, Srikanya said.
The pension fund, which manages money for about 1.2 million government employees and retirees, currently invests about 13 per cent of its assets in overseas stocks, said Srikanya. It also holds about 25 per cent of total assets in overseas debt securities, bringing its foreign holdings near its 40 per cent ceiling, she said.
