Mobius May Double Size of Russia Portfolio
Published: July 31, 2009 (Issue # 1496)
Mark Mobius said Wednesday that he plans to double Templeton Asset Management’s emerging-market assets to $50 billion within two years.
Templeton may also allocate more funds to Russia, which could “theoretically” account for as much as 20 percent of its portfolio compared with 10 percent now, Mobius said in Volgograd. He didn’t say how much of the portfolio’s growth would be because of the rising price of stocks and bonds.
“Emerging markets will be the first to climb out of the crisis, and Russia will be one of the leaders,” said Mobius, who oversees about $25 billion as executive chairman at Templeton. “Authorities in those countries have the chance to act more promptly and decisively.”
China is a top pick in emerging markets, followed by Brazil, and then India and Russia, Mobius said.
“Before, purely driven by valuations, China and Brazil were cheaper. But now, Russian stocks look cheaper, so we expect Russian stocks to come up and become more important” in Templeton funds, he added.
In Russia, Templeton is focused on commodity and consumer stocks, he said. “Consumers are bad now but will be recovering and doing well next year.”
Templeton may increase its 0.5 percent stake in RusHydro to as much as 10 percent, Mobius said. “We don’t have much investment in other Russian power companies because we feel RusHydro is the best,” he said.
RusHydro is accepting bids until Aug. 10 for a secondary share offer at 1 ruble par value. Of a 16 billion share issue, the state has already used pre-emptive rights to buy 4.9 billion and private investors 2.3 billion, leaving the rest for the offer.