This report is the updated version of the report uploaded on 23 January 2023 at 10:24 PM GMT +13.

Templeton Emerging Markets Investment Trust Plc

TEM Details

Templeton Emerging Markets Investment Trust Plc (NZX: TEM) is an investment trust company. It is engaged in investing mainly in emerging markets companies to deliver capital growth to shareholders over the long term.

Financial Results for 1HFY23

• It reported net revenue earnings for the period under review of 4.16 pence per share
• The company has declared an interim dividend of 2.00 pence per share, which will be paid to shareholders on 27 January 2023, an increase of 1.00 pence per share compared with last year's interim dividend.
• TEM has fixed borrowing of £100 million.

Key Updates

• On 24 January 2023, Franklin Templeton Investment Trust Management Limited reported that TEM's unaudited cum-income net asset value as of 20 January 2023 stood at £2,079.727 million, representing a NAV of 179.01 pence per share
• On 9 December 2022, the company declared an interim dividend of 2.00 pence per ordinary share pertaining to the six-month period to 30 September 2022

Outlook

The company aims to generate attractive returns over the long term. Countries accounting for emerging markets currently contribute a large proportion of the world's economic growth, and this is expected to sustain as emerging markets enjoy various structural advantages such as relatively young and growing population, increasing wealth, growing economies, and companies.

Key Risks

TEM is exposed to the risk of the adverse impact of the COVID-19 pandemic, volatility in the prices of the company’s investments and the global markets arising from macroeconomic and geopolitical circumstances.

Stock Recommendation

Over the last 6 months, the stock has given a return of ~+6.25%. The impact of high inflation, the resulting increase in interest rates and strains on currency exchange rates and geopolitical concerns remain a concern.

Resultantly, it is prudent to book profits at the current levels.

Hence, a ‘Sell’ rating has been provided on the stock at the closing price of NZD3.020 per share as of 20^th January 2023.

Technical Overview:

Daily Price Chart

Markets are trading in a highly volatile zone currently due to certain macro-economic and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for share price chart and stock valuation is based on January 20, 2023, and all other data such as stock price performance as of January 24, 2023. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Disclaimer

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