Investment Outlook

Positive momentum can be seen across Asia in the consumer and SME lending market, backed by P2P lending platform, venture capital, and other investors (1) (2) (3) (4) (5) (6). The maturing lending market increases reliability and offers scaling opportunities for investors (7) (8), however there remains the risk of overheating of the market due to the increased attention by larger investors looking to capitalize on the potential gains. In order to outperform the market it is vital to ensure careful attention is paid to due-diligence and loan selection processes (9) (10).

Machine translation technologies are facilitating the growth of online educational tools in China, leading to increasing valuations and improved investment opportunities (11) (12). International investments increase business opportunities in online education platforms, with a particularly focus on English-learning-for-kids (13).

 

References

  1. Prospa's IPO is out, and two top VC firms have tipped in more money ahead of the $146 million float

  2. P2P Lending Platforms in Philippines Rising - Fintech Singapore

  3. Indonesian P2P lender raises $5 million in Series A funding

  4. Lendr Records Double Digit Growth in Philippines, Disbursed Over $500 Million in Loans

  5. Online lender Capital Float gets debt investment of $7m from Triodos

  6. Chinese online lender Weidai said to plan $400m IPO

  7. Funding Societies gets $25M Series B led by Softbank Ventures Korea

  8. India: Amazon provides $22m equity funding to digital lender Capital Float

  9. Despite Rapid Growth, Hexindai Fails to Thrill Investors

  10. Lending Club - Membership revoked

  11. Machine Translation and Online Education: Series A Values Youdao at USD 1.1 Billion | Slator

  12. China’s VIPKID, which links English tutors with online learners, raises $500M at $3B+ valuation

  13. Tencent and education startup Age of Learning bring popular English-learning app ABCmouse to China


The growing Asian Middle Class will lead to increasing discretionary spending by wealthier consumers, resulting in an expanding consumer market and strong GDP growth in those nations (1). The tremendous scope for growth in fintech and retail banking in Vietnam is primarily led by the up-and-come middle class consumers (2). A stronger middle class consumer base also contribute to an increase in the regional tourism market (3). Additionally, the continued increase in Market Efficiencies is useful for multiple expansion due to better governance (4).

Japan’s female labour force continues to rise, increasing household income and economic growth potential (5). Market analysis concludes that Japanese Small Caps are currently 18 undervalued and strong growth potential (6). Nevertheless there are some negative outlooks 19 on the Japanese economy which could carry a rather high correction risk (7).

 

References

  1. Asia’s Youth The Tastes That Matter

  2. Vietnamese fintech space to continue to attract investor interest: EY report

  3. Travel activities platform KKday raises $10.5M led by Japanese travel firm H.I.S.

  4. Indonesia set to issue stricter regulations for fintech sector

  5. Party Fears Two

  6. Land of the Rising Alpha: The Case for Japan Small Cap Equities

  7. Another Japanese recession? Brace for heavy weather ahead


Non-traditional banking and financing services are on the rise with companies such as Grab moving into micro-financing (1), Australian SME’s looking for alternative lending options (2), and other Fintech companies moving into virtual banking services (3). China’s recent move to open their payments market to foreign investors could provide a boost for innovation and increase investment demand (4) (5).

Overall, the Fintech market is at risk of overhype (6) (7) but first signs of the end of the hype cycle are evident in Asia’s decline in Fintech investments (8) and China moves to tighten regulations (9).

Growing demand for digital marketing is increasing the importance of firm’s online presence, and the services offered by digital ad platforms (10). The E-commerce market continues growing (11) as Alibaba expands their business to South Asia (12) and, back in China, Pindodu grows to one of the largest e-commerce apps, capitalizing on their WeChat user base (13) (14). The E-signature market continues to grow as DocuSign pushes for more financial services to accept online signatures as they prepare to go live with their IPO (15).

 

References

  1. Grab, Uber’s Southeast Asia rival, now offers micro-loans and other financial services

  2. Australian SMBs Prefer FinTech Over Banks

  3. WeLab joins race to become Hong Kong’s first licensed virtual bank

  4. China Allows Foreigners to Enter $27 Trillion Payments Market

  5. Orix invests $60m in Chinese fintech startup Wecash

  6. No-fees mobile bank Chime raises $70M Series C, valuing its business at $500M

  7. A top fintech investor is partnering with a member of the World Bank to cash in on 'a big opportunity'

  8. Asia sees massive drop in fintech investment as China loses momentum

  9. China tries to bring order to sprawling online finance sector

  10. 36% more active digital display ads this month

  11. Q&A: China Renaissance's Bao Fan hunts the next Alibaba

  12. Alibaba buys Rocket Internet’s Daraz to expand its e-commerce empire into South Asia

  13. Alibaba's Worst Nightmare: Pinduoduo Becoming the No.1 E-commerce App in China

  14. Pinduoduo: why China's e-commerce dark horse is on the rise

  15. DocuSign has filed confidentially for IPO


China’s Electric Vehicle market is rapidly growing, with car sales projected to overtake Europe and the US by 2025 (1), China plans to invest heavily in battery production (2) to facilitate the adoption of EVs to rival Tesla’s own Model X (3) and push self-driving technology forward (4).

Positive investment dynamic in transportation-sharing and food delivery industry (5) (6), including growth in ride-hailing sector as Alibaba prepares to invest in Grab (7). Transportation service companies such as Uber continue to expand their business scope (8).

 

References

  1. Chart of the day: China is leading a surge in electric vehicle sales

  2. The Swift Rise of a Chinese Battery Giant

  3. NIO opens its first electric car service center right next to Tesla’s

  4. Start-up NIO, car major SAIC cleared to test driverless cars in Shanghai

  5. Meituan-Dianping buys top bike-sharing company Mobile

  6. Meituan to Seek a $60 Billion Valuation in Hong Kong IPO

  7. Alibaba is preparing to invest in Grab

  8. Uber launches Uber Health, a B2B ride-hailing platform for healthcare