Zhang Kun, China’s biggest fund manager, raised bets on liquor distillers, sold tech giants Tencent, Meituan in third quarter

E Fund Management’s Zhang bet on companies he considers best equipped in their industries to navigate the turmoil roiling capital markets

His fund returned 1.6 per cent last quarter, while the CSI 300 Index fell 4 per cent and the Hang Seng Index lost 5.9 per cent

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Zhang bought 2.56 million shares in fiery liquor producer Wuliangye, Kweichow Moutai’s biggest rival, in the third quarter. Photo: Shutterstock

Published: 7:00am, 26 Oct 2023Updated: 8:51am, 26 Oct 2023

Zhang Kun, China’s biggest fund manager, increased his holdings of liquor distillers and trimmed his position in technology companies in the third quarter, betting on companies he considers the best equipped in their respective industries to navigate the turmoil roiling capital markets.

Zhang’s US$6.7 billion E Fund Blue Chip Selected Mixed Fund bought shares of distilleries Wuliangye Yibin and Jiangsu Yanghe Brewery Joint-Stock between July and September, while paring its exposure to Tencent Holdings and Meituan, the offshore listed tech stocks that are most susceptible to headwinds overseas, according to its quarterly portfolio report released on Wednesday.

China’s economy should stabilise after a flurry of policy loosening measures in the third quarter, including cuts in the loan prime rate and in down payments for home purchases and mortgage rates, Zhang, who works for Guangzhou-based E Fund Management, said in the report.

His fund returned 1.6 per cent in the three-month period ending September 30, while the CSI 300 Index fell 4 per cent and the Hang Seng Index lost 5.9 per cent.

“We are sticking to the good quality companies that have decent business modes, clear industry landscapes and strong competitiveness,” Zhang said in the fund’s quarterly report. “The valuations of these good quality companies are generally very attractive.”

Zhang Kun’s fund returned 1.6 per cent in the three-month period ending September 30, defying a 4 per cent decline in the CSI 300 Index. Photo: SCMP Handout

His blue chip fund, which he has been running since 2018, is bigger than any other stock-focused product in China’s 28 trillion yuan (US$3.8 trillion) mutual-fund industry.