Despite representing just 3.3 per cent of world equities, Fidelity International says Chinese companies quoted on mainland markets rank at the top or close to the top of valuation tables in mobile phones, banks, life insurance, real estate, oil and gas producers and forestry and paper.
Fidelity says when the MSCI updates its indices at the end of the month, PetroChina will become the largest listed company in the world having risen from 20th to first place in the last few days following a limited public offering.
At the turn of the century, just two Chinese companies ranked in the top ten of their sector – China Mobile and Citic Pacific, the industrials group.
Fidelity China focus fund manager Martha Wang says that while the annual growth rates of 30-40 per cent in investment in fixed assets had been exceptional over the past few years, they will remain strong.
She says: “Over the longer term we believe China will continue to offer some very attractive opportunities to investors. At just 3.3 per cent of world equities, China has a long way to go before its economic might is represented fully in the stock markets.”