The Flying Dutchman Asia’s forgotten gems [Correction]

Research evidence excerpt

19 May 2026

The Flying Dutchman

Equity Strategy

Asia

Asia’s forgotten gems [Correction]

◆ The rally in AI stocks has made markets more concentrated,

drawing attention away from high-quality firms in Asia

◆ Many global and national champions, or high dividend stocks

with no meaningful AI exposure, trade at attractive multiples

◆ We highlight 10 forgotten gems in Asia

AI in focus: Across Asia, AI stocks are still running hot. But the performance is

concentrated as more than half of index returns come from TSMC, SK Hynix and

Samsung Electronics – ‘Asia’s Tech Trident’. The top 10 AI names now account for c30%

of a typical GEM or Asia fund. Growth is rewarded, but profitability or dividends much less

so. The knock-on effect is that some Asian ‘gems’ are now being forgotten.

Herald van der Linde*, CFA

Head of Equity Strategy, Asia Pacific

The Hongkong and Shanghai Banking Corporation Limited

Widen the lens: Using Porter’s Five Forces framework, we identify and screen for firms

that have a strong sustainable advantage either in global or domestic markets, despite

little AI exposure. We call them global or national champions. These firms enjoy strong

brand, management or profitability that have helped them gradually gain market share.

We also assess stocks with a high and sustainable dividend stream backed by steady

cash flows or large cash holdings. Many of these stocks are now available at attractive

valuations.

Prerna Garg*

Asia Equity Strategist

The Hongkong and Shanghai Banking Corporation Limited

10 overlooked quality stocks:

◆ Growth in China’s WuXi AppTec remains on track, supported by solid customer

demand and global capacity expansion in drug development.

Varun Pai*

Associate

Bangalore

As the world’s largest automotive glass maker, we think the market is undervaluing

the growth runway for China’s Fuyao Glass.

* Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

not registered/ qualified pursuant to FINRA regulations

China’s Xiamen Faratronic holds a leading position as the largest film capacitor

supplier to solar and energy storage system (ESS) inverters globally.

Investors are concerned about Korea’s Samyang Foods’ slowing growth in

…