Travel Diary - Observations from Wuhan 

After enduring Covid-19 early this year, residents of the 11 million city of Wuhan had to confront a major flood in July. Our research analyst in Beijing, Yishuo Liu, recently visited the city to gain more knowledge from an on-the-ground experience. She noted that “life has returned to normal” and that the people of their city have certainly shown their resilience.

During the visit, Yishuo was able to validate that retail channels for maternity and baby products are still mainly offline, while many pharmacies and grocery stores remain offline and are very fragmented (multiple small brands) – potential to shift online? She noted that property service companies have a strong relationship with residents and can upgrade their business models to facilitate the online-to-offline move by deploying community buying and other methods. Speaking to a few sources on-the-ground, Yishuo was able to triangulate the high margins in nutrition products across the production-wholesale-retail chain.

This level of knowledge helps us supplement our fundamental investment case and is why we truly value first-hand accounts from different regions in Emerging Markets.

#hedgefunds #investing #equities #emergingmarkets #Assetmanagement