Richard Sennitt, manager of three Elite Rated funds: Schroder Asian Alpha Plus, Schroder Asian Income and Schroder Oriental Income Trust shares his approach to navigating investment opportunities across Asia in the latest episode of FundCalibre’s podcast.
The interview explores the impact of AI on semiconductor manufacturing and tech enablers, the growth potential in financials and insurers and the evolving dividend culture in markets like Singapore, Korea and China.
Richard shares his approach to balancing income generation with capital growth, emphasising natural dividend streams over chasing yields. He also discusses portfolio construction, sector rotation and managing long-term risk amid macroeconomic uncertainty.
Why you should listen to the interview: This interview offers an insider perspective on Asian markets, blending expertise with actionable insights. Learn how to evaluate AI opportunities, navigate dividend growth across countries and balance income with long-term capital growth.
This interview was recorded on 24 March 2026. Please note, answers are edited and condensed for clarity. To gain a fuller understanding and clearer context, please listen to the full interview.
Interview highlights:
Assessing AI opportunities in Asia
“Obviously AI is a very strong, powerful, global thing, but I think from an Asian perspective, it really manifests itself in the enablers around AI. So it’s much more in the companies that supply into the US hyperscalers, for instance.
“So the people that manufacture the semiconductor chips and the associated products is where Asia’s particularly strong.
“So here you’re thinking of companies like TSMC, Samsung Electronics would be examples of that, and where we tend to find those companies, these largely in North Asia, so Korea and particularly in Taiwan, which have quite long supply chains and have got a rich, deep venture companies, which have exposure to that particular theme.
“As long as there is this structural growth in AI demand and the need to continually increase spend there, those companies will be beneficiaries of that.
“Korea and Taiwan are benefiting from that. You are also seeing places like China increasingly look at getting into some of that manufacturing side of things.
“It is a bit harder for them around some of the restrictions that they have. But where they’ve been more in the news over the last 12 to 18 months is more around their large language models and so on.
“If you think things like Deep Seek, remember we had that Deep Seek moment a year ago, which is their particular large language model, which was shown to be very powerful.
“And their internet platform companies, a bit similar to what we’ve seen in the US around the hyperscalers, have been investing quite a lot in semiconductor CapEx related to AI.
“But for now at least, it’s difficult to know exactly where the returns from that are going to come.”
Opportunities beyond AI
“Everyone gets quite fixated on AI at the moment, and the market has reflected that in the sense it has been quite narrow.
“From my perspective, what I’ve been encouraged to see more recently is that there has been a bit more of a broadening out of the market, certainly from an earnings perspective. If that continues, that’s obviously encouraging.
“Some of the areas that I like outside of AI have been some of the things where I’ve been overweight for a while include financials.
“That is a sector where it’s quite broad in the sense it’s quite heterogeneous. So it’s not just banks, it’s also insurers, it’s also exchange companies.
“The long-term growth which we’re seeing coming through in Asia more broadly should benefit those companies as penetration of financial products improves.
“If you think about insurance products, for instance, life and different forms of protection, health and so on, are very lowly penetrated in Asia compared to Western markets.
“As the market grows and the economies continue to develop, we should see increased penetration of those products, which will drive those industries.
“Similar trends are happening in banks. Banks are lenders, which is important, but the wealth management side of their businesses has been growing over time and should continue to grow, increasing its importance across the region.”
Oil prices and market impact
“What’s going on [in Iran] has implications for Asia, not least that Asia is a net importer of oil and gas.
“So from the perspective of a rising oil or gas price, that clearly is a headwind, and the knock-on to interest rates could be an issue if rates were to go up globally as it tightens liquidity.
“We very much manage the portfolio from a bottom-up perspective, focused on the durability of the returns of those businesses through time.
“Analysts based out of the region factor in not only a base case for valuation, but also a bear case and a bull case. That provides a good framework to understand what’s being priced into stocks at any moment in time and is useful when taking a longer-term view about buying or selling companies.
“It’s hard to disassociate completely from macro events, but the principal driver of the way we manage money is on a stock basis.”
Balancing income and growth
“It’s an important point because it means the Schroder Oriental Income Trust can perform differently in different markets.
“From an income perspective, we’re very much focused on generating a natural income. We’re not looking to pay out of capital; as a trust, we have reserves we can use, generated by previous dividends paid by underlying companies over the years. So the focus is on natural income.
“Therefore, the types of businesses we own must have a natural income because dividends paid by those companies can be paid out to shareholders within the trust.
“That income rationale does mean you’re likely to have a value tilt to the trust rather than a growth focus. Certain areas of the market, like Chinese internet platform companies, pay little in dividends, so we don’t have much exposure there.
“But we don’t just screen for the highest yielding stocks and backfill the portfolio. We buy into companies that have an income rationale, but also potential upside to their fair value.”
Conclusion: Richard Sennitt leaves us with a nuanced view of Asian investing: one that balances structural growth opportunities, like AI and financials, with a disciplined focus on income and dividends. The discussion highlights how a long-term lens can help navigate volatility while still capturing growth potential.
Past performance is not a reliable guide to future returns. You may not get back the amount originally invested, and tax rules can change over time. The writer’s views are their own and do not constitute financial advice.
This information should not be relied upon by retail clients or investment professionals. Reference to any particular investment does not constitute a recommendation to buy or sell the investment.
Main image: Podcast, will-francis-ZDNyhmgkZlQ-unsplash
