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TEM

0.67%
GOOD

Templeton Emerging Markets IT Outperforms Benchmark Amid Global Uncertainties

Why we think this is good

The investment trust has demonstrated strong performance in a challenging global environment. With a NAV total return of 8.8% and share price total return of 13.3%, both outperforming the benchmark's 5.8%, the trust has shown resilience and growth. The narrowing discount to NAV, from 15.4% to 12.4%, indicates improved investor confidence. A 5% increase in dividend and a reduction in the ongoing charges ratio further underscore the trust's solid management. However, the slight decrease in total net assets and increased geopolitical risks, particularly US-China tensions and potential trade disruptions, temper the overall positive outlook. While the trust maintains a positive view on emerging markets, these external factors introduce an element of caution.

Key Points

  • NAV total return of 8.8%, outperforming the benchmark's 5.8%
  • Share price total return of 13.3%
  • Proposed total dividend increased by 5% to 5.25 pence per share
  • Discount to NAV narrowed from 15.4% to 12.4%
  • Ongoing charges ratio improved to 0.95% from 0.97%
  • Total net assets decreased by 2.43% to £1,985.4 million
  • Net gearing increased slightly to 0.2% from 0.0%
  • Positive outlook on emerging markets despite geopolitical uncertainties

Summary

This investment trust outperformed its benchmark with strong NAV and share price returns, increased its dividend, and narrowed its discount to NAV, despite facing global economic uncertainties and geopolitical tensions.

Templeton Emerging Markets Investment Trust (TEMIT) has delivered a robust performance for the year ended 31 March 2025. The trust's NAV total return of 8.8% and share price total return of 13.3% both outperformed the benchmark's 5.8% return. The trust's financial position remains strong, with net gearing at a low 0.2%. The board has proposed a 5% increase in the total dividend to 5.25 pence per share. The ongoing charges ratio improved to 0.95%, down from 0.97% in the previous year. However, total net assets decreased slightly by 2.43% to £1,985.4 million. The trust maintains a positive outlook on emerging markets, supported by improving macro conditions and structural growth trends, but acknowledges potential headwinds from geopolitical tensions, particularly between the US and China.

Key Dates

July 10, 2025
Annual General Meeting
Late January 2026
Revolving credit facility matures
2029
Next continuation vote
ANNUAL RESULTS