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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Pangolin Asia Fund 2024 Q2 Investor Letter | Buyside Digest

Back to Fund Profile (Pangolin Asia Fund)

Primary Source Intelligence • Q2 2024 Letter Analysis

Pangolin Asia Fund Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Pangolin Asia Fund. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

Annualized+8.39%

Positioning StanceNEUTRAL

GeographyAsia, Emerging markets

Digest Analysis

Quick Take

"Pangolin Asia Fund seeks long-term capital appreciation by investing in compellingly undervalued ASEAN equities supported by strong demographic trends, growing middle-class ambition, and robust economic growth."

Executive Summary

Pangolin Asia Fund seeks long-term capital appreciation by investing in compellingly undervalued ASEAN equities supported by strong demographic trends, growing middle-class ambition, and robust economic growth. During June 2024, the fund's NAV declined 0.83%, bringing year-to-date performance to -5.51%, primarily impacted by US dollar strength, regional currency depreciation, and interest rate hikes by Bank Indonesia that depressed Indonesian financial and consumer holdings. Despite these headwinds, the fund's portfolio trades at its cheapest valuation levels since 2009, featuring a weighted forward P/E ratio of 9.4x and a projected dividend yield of 5.6%. Pangolin remains approximately 95% invested, allocated predominantly across Indonesia (53%) and Malaysia (37%), alongside Singapore (8%) and the Philippines (2%). The manager fully exited Hexindo Adiperkasa after realizing strong historical gains, eliminating commodity-linked risk and increased net debt in favor of predictable consumer growth. Pangolin is actively channeling dividend income into accumulating high-quality Southeast Asian equities at distressed valuations, maintaining a high-conviction posture despite capital shifting toward US technology megacaps.

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Institutional Meta Strategy

Meta Strategy Gauges

Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.

Signal Matrix

Market Conviction

78%

CautiousHigh

High Conviction (78%)

High conviction evidenced by 95% invested portfolio, concentrated geographic focus, and manager's explicit comparison to 2009 opportunity. Manager names specific holdings, discusses position sizing (largest holding BFIN), and makes strong declarative statements about valuations and long-term prospects.

Growth Outlook

25%

BearishBullish

Bearish (25%)

Manager acknowledges near-term headwinds from institutional selling and currency weakness but expresses optimism about strong GDP growth forecasts (5-6% across ASEAN) and major industrial investments. Tone is constructive despite current challenges.

Risk Appetite

40%

DefensiveAggressive

Defensive (40%)

Fund remains 95% invested with concentrated exposure to ASEAN markets. Manager sold one position (Hexindo) but continues to deploy dividend income into cheaper stocks, indicating maintained risk appetite despite volatility.

Capital Deployment

5%

De-riskingDeploying

De-risking (5%)

Minimal net deployment activity with one sale (Hexindo) but dividend reinvestment into existing positions. Fund remains 95% invested with no significant cash level changes mentioned, indicating rotation rather than major deployment or de-risking.

Forward Guidance

30%

CautiousExpansionary

Cautious (30%)

Manager expresses intention to reinvest dividends into stocks getting cheaper and maintains conviction about eventual institutional flow reversal. Forward-looking statements are cautiously optimistic with emphasis on patience.

Language Signal

15%

BearishBullish

Bearish (15%)

Language includes both opportunity-focused terms (cheap valuations, compelling, undervalued) and risk acknowledgment (walloped, fallen, headwinds). Net balance slightly positive but measured given current challenges.

Perceived Risk

45%

Low RiskElevated

Moderate Risk (45%)

Manager acknowledges specific risks including institutional selling pressure, currency depreciation, and rate impact on Indonesian holdings. Risks are named and discussed but not characterized as systemic or extreme threats.

Opportunity Density

75%

ScarceAbundant

Abundant (75%)

Manager emphasizes abundant opportunities with valuations as cheap as 2009 levels, describing stocks at giveaway prices and ludicrously cheap valuations. Strong conviction that current environment offers compelling investment opportunities across the region.

Time Horizon

80%

Short-TermLong-Term

Decade+ (80%)

Manager explicitly references long-term demographic trends, compares to multi-decade wealth creation in China and India, and emphasizes patience. Fund structure and approach suggest multi-year investment horizon with focus on fundamental value realization over time.