Axis Greater China Equity Fund of Fund: Attractive international investment in current global market conditions

After years of underperformance versus developed markets, emerging markets have outperformed developed markets on a year to date basis in 2025 (see the chart below). Lower valuations and weakening US Dollar (versus major currencies) have made emerging markets attractive for investors compared to developed market like the United States.

Source: MSCI. MSCI World Index represents large and midcap stocks from 23 Developed Markets. MSCI EM Index represents large and midcap stocks from 24 Emerging Markets. As of 30^th September 2025

Within the emerging markets pack, Greater China rebounded strongly in 2024 and has continued its outperformance in 2025 (see the chart below).

Source: MSCI. MSCI Golden represents large and midcap stocks from China, Taiwan and Hong Kong. As of 30^th September 2025

Axis Greater China Equity Fund of Fund is an international Fund of Fund, which invests in Schroeder ISF Greater China Fund. Investors can get exposure to Greater China (China, Taiwan and Hong Kong equities) through Axis Greater China Equity Fund of Fund.

Growth drivers for the Greater China market

• Despite high tariffs imposed by the United States on imports from China, trade talks between the two countries are progressing. The Trump Administration expects to reach trade agreement in next few months.


• Consumption pattern is changing. Chinese consumers are increasingly moving towards 'emotional consumption (see the chart below).
  
  

  

  Source: Schroeders.



• Deep Seek AI has taken the technology world by storm and is expected to create new investment opportunities. US Tech equity stocks' market cap has doubled in last 2 years from USD 6.8T (January 23) to USD 17T (January 25). Extrapolating the growth potential for Chinese AI Tech stocks, there is huge headroom for growth in the future.
  
  

  

  Source: FactSet, MSCI, HSI, CSI, Goldman Sachs, as on 21 February 2025. US Mag 7 includes Nvidia, Microsoft, Apple, Alphabet, Amazon, Meta and Broadcom



• Top Chinese technology companies are trading at significant discounts to their US peers. The average PE of Top 10 US AI-related companies is 42X earnings, while the average PE of Top 10 Chinese AI-related companies is 17X earnings (source: FactSet, as on 4^th February 2025).


• China is becoming a major player in the global biotech industry. China contributes 50% of the innovative drugs that newly entered into clinical stages in 2025YTD (as of 4^th January 2025).
  
  

  

  Source: Schroeders.



• Valuations of MSCI Golden Dragon Index (Greater China) is more attractive than both MSCI World Index (Developed Markets) and MSCI ACWI (Developed and Emerging Markets)
  
  

  

  Source: MSCI, as of 30^th September 2025

Axis Greater China Equity Fund of Fund – Outperforming global index

Source: Advisorkhoj Research, as of 30^th September 2025

Schroeder's Asian Equities Advantage

• Schroeder's Asian Equities team has 59 Asia Pacific ex Japan fund managers and analysts based in seven offices that conduct more than 2,600 company visits per year across the Asia Pacific region


• The Greater China equity team comprises of other 19 members from the above mentioned Asian equities team


• Schroeder's total Asia Pacific ex Japan Equity AUM is about USD 49B as of 31 December 2024. Greater China equities is a significant part of the business, and is about USD15B of total Asian equities AUM

Why invest in Axis Greater China Equity Fund of Fund?

• Chinese economy is fundamentally changing - away from real estate development into AI and Industrial Automation


• Chinese manufacturing and exports becoming more value added


• China is a leader in new technology - robotics, AI, telecom


• Extreme valuation divergence is also supportive of China inflows


• Global investors allocation to China is currently underweight, can see significant inflow if structural challenges are overcome

Who is this fund suitable for?

• Investors seeking to diversify single country risk by investing in international equities


• Investors seeking exposure in Greater China equities


• Investors looking for capital appreciation for long investment tenures


• Investors with a high risk appetite


• Investors with minimum 5 years of investment tenure

Investors should consult with their financial advisors or mutual fund distributors if Axis Greater China Equity Fund of Fund is suitable for their investment needs.