Naspers is still attractive. It’s not expensive – Allan Gray
The biggest asset you own – though you may not even realise it - is probably Naspers.
Every South African with a retirement policy has exposure to the company, which makes up about 20% of the weight-adjusted index.
South Africa’s biggest offshore asset is Tencent, making it an extremely important share to South Africans.Duncan Artus, portfolio manager - Allan Gray
We’re always talking about what the gold price is doing, but we should rather be discussing the price of Naspers, given that so many South Africans are exposed to it.Duncan Artus, portfolio manager - Allan Gray
There’s not much opportunity in gold currently, according to Artus.
In the last 10 years, it’s been better to own metals, rather than the mines. This is because we have generally found that in platinum and gold mining companies it is better from a risk-adjusted point of view to own a little bit of a physical product. We currently have a small exposure to Goldfields and in the Allan Gray Balanced and Stable funds, we hold the listed gold ETF that let you benefit from the rising rand gold price.Duncan Artus, portfolio manager - Allan Gray
Artus believes there may be an opportunity in consumer shares.
For more detail, listen to the interview in the audio below (and scroll down for quotes from it).
We still think Naspers is attractive… just the value of its stake in Tencent… is still a lot higher than the current Naspers share price. You’re getting the rest of the business for free…Duncan Artus, portfolio manager - Allan Gray
If Naspers was expensive, we would have zero exposure to it… We have around 13% of our South African shares in Naspers…Duncan Artus, portfolio manager - Allan Gray
Tencent trades around 38 times its profit. That’s high… but if we value the rest of Naspers… we think you’re paying around 26 times earning for Tencent… We don’t think that’s excessive…Duncan Artus, portfolio manager - Allan Gray
Warren Buffett thinks gold is a worthless asset…Duncan Artus, portfolio manager - Allan Gray
Gold companies over the long term haven’t been great investments… We tended to hold miners when they’re cheap…Duncan Artus, portfolio manager - Allan Gray
MultiChoice… we’re one of their biggest shareholders… It’s gone from R92 to R135… but it needs pay-tv in the rest of Africa to turn around…Duncan Artus, portfolio manager - Allan Gray
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This article first appeared on 702 : Naspers is still attractive. It’s not expensive – Allan Gray
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