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Take a look at the companies shaping China’s economic future
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Investors looking to access the China growth story can find targeted exposure through the top 50 domestically listed companies. Here, UOB Asset Management (UOBAM) explores the market positioning and outlook for the five most influential.
The FTSE China A50 Index tracks the 50 largest A-share companies listed on the Shanghai and Shenzhen stock exchanges. From baijiu leader Kweichow Moutai to electric vehicle (EV) battery giant Contemporary Amperex Technology (CATL), it includes some of China’s most influential firms.
To better understand the FTSE China A50 Index, let’s take a closer look at its top five holdings, which make up one-third of the index.
1. Kweichow Moutai
This is China’s top baijiu brand. Its premium liquor is a fixture at formal events, and the company has expanded into lifestyle products like Moutai-infused ice cream and coffee.
Outlook
Despite a 20% price hike in late 2023, Kweichow Moutai posted 16% revenue growth in 20241. While slightly below expectations, this highlights its strong brand and pricing power. Government efforts to boost domestic consumption may further support demand.
Performance
Source: Bloomberg, as of 30 May 2025
Although Kweichow Moutai has declined 0.1% year to date, the company has historically performed well, with annualised returns of 4.4% over the past five years. The stock is also trading below its historical valuation, suggesting attractive upside potential.
2. Contemporary Amperex Technology (CATL)
This is the world’s largest EV battery maker and a key supplier to Tesla. It recently raised US$4.6 billion in its Hong Kong IPO, with shares jumping over 16% on its trading debut amid robust investor demand2.
Outlook
Despite a global slowdown in EV demand and declining battery prices, CATL has maintained its dominance in the global EV battery market with a 38.2% market share3. The company achieved a 33% increase in earnings in Q1 20254, highlighting its strong fundamentals.
Performance
Source: Bloomberg, as of 30 May 2025
CATL has recorded negative returns in the year to date, largely due to geopolitical headwinds. Of the five top holdings, CATL has the largest US revenue exposure at 9.7%5. However, the company notes the US makes up a small portion of its shipments, so tariffs will likely have minimal impact on future performance6.
Moreover, CATL has historically been a strong performer, with annualised returns of 26.7% over the past five years. Its valuation is also below long term historical average levels, suggesting attractive upside potential.
3. China Merchants Bank
As one of China’s largest commercial banks, its offering includes a wide range of financial services, including retail banking, corporate banking and wealth management.
Outlook
The bank has seen strong momentum in its wealth management business, with retail AUM rising 12% year-on-year in 20247.
Performance
Source: Bloomberg, as of 30 May 2025
China Merchants Bank has gained 10.5% so far this year amid a wider trend of investors gravitating to Chinese banks for their attractive dividend yields. However, valuation remains undemanding, hovering slightly below its historical average.
4. China Yangtze Power
This is the world’s largest listed hydropower company. It operates the Three Gorges Dam and other major hydropower stations along the Yangtze River, contributing significantly to China’s clean energy output.
Outlook
The company posted a 19 percent rise in net profit in 20248, driven by increased electricity generation as China experienced heavy rains in 2024. Long-term prospects are supported by China’s clean energy goals, with hydropower playing a key role in the country’s carbon neutrality targets.
Performance
Source: Bloomberg, as of 30 May 2025
China Yangtze Power has delivered solid returns of 15.7% over the past five years and is up 2.2% year to date. However, the stock currently appears slightly overvalued.
5. BYD
This is the world’s top EV seller and the sixth-largest automaker globally.
Outlook9
BYD is aggressively expanding, targeting over 800,000 overseas vehicle sales in 2025, while increasing domestic market share through competitive pricing and value-added features. Consequently, its Q1 2025 net profit doubled year-over-year, the fastest growth in nearly two years10.
Performance
Source: Bloomberg, as of 30 May 2025
BYD is up 24.6% year to date and has generated average annual returns of 44.2% over the past five years. Despite this strong performance, its valuation remains at attractive levels.
Source: Bloomberg, as of 30 May 2025
How to invest in the FTSE China A50 Index
Investors can gain exposure to the FTSE China A50 Index by investing in exchange traded funds (ETFs) that track the index. For Singapore investors, the UOBAM FTSE China A50 Index (SGX: JK8) is an attractive option that is listed on the Singapore Exchange (SGX) and offers trading in Singapore dollars. This offers convenience for Singapore investors who do not wish to bother with currency exchange issues.
The ETF can be bought from just one unit, and Singaporeans can also invest in the ETF using their SRS funds.
Learn more about the UOBAM FTSE China A50 Index (SGX: JK8) here.
Sources
1 - Kweichow Moutai earnings report, as of 31 Dec 2024
2 - China's battery giant CATL surges 16% on Hong Kong debut in world's biggest IPO this year, CNA, 20 May 2025
3 - SNE Research, based on Jan and Feb data for 2025
4 - CATL earnings report, as of 31 Mar 2025
5 - Bloomberg, as of 28 Apr 2025
6 - CATL earnings report, as of 31 Mar 2025
7 - China Merchants Bank earnings report, as of 31 Dec 2024
8 - China Yangtze Power Announcement on 2024 Preliminary accounting data
9 - BYD earnings call, 26 March 2025
10 - BYD earnings call, 26 March 2025
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