The technology sector is one of the most rapidly changing and unpredictable industries globally. In Asia, this is particularly true, as the region is home to some of the most innovative and entrepreneurial tech firms on the planet. It has led to a situation where traditional stock investing strategies are often not well-suited to the Asian tech sector.
To invest in Asian technology firms, you must have a thorough grasp of the newest trends and advances within the sector; you can learn this here. Here are some of the fundamental ways that technology is influencing how we value stocks in Asia:
The rise of electric vehicles has a significant impact on automotive stocks in Asia.
Electric vehicles are becoming increasingly popular worldwide, but Asia is leading this trend. In China, the world’s largest market for electric vehicles, sales of EVs doubled in 2017 to reach over 600,000 units.
For example, BYD Company Ltd., a Chinese firm that manufactures electric vehicles, has doubled its share price since 2016. Similarly, Japanese automakers Honda and Toyota have seen their stock prices rise as investors bet on their EV plans.
The growing popularity of mobile payment apps is changing how we bank in Asia.
Mobile payment apps like Alipay and WeChat Pay are becoming increasingly popular in Asia. They offer a sensible way to pay for goods and services without carrying cash. It has a significant impact on the banking sector, as people use these apps instead of traditional bank accounts.
In China, the world’s largest market for mobile payments, over 50% of people now use mobile payment apps, up from just 20% in 2016. This trend is also starting to catch on in other Asian countries like Singapore, Indonesia, and India.
The rise of e-commerce is changing the retail landscape in Asia.
E-commerce is booming in Asia as more and more people turn to online shopping for their needs. It’s significantly impacted traditional brick-and-mortar retailers, struggling to keep up with the competition.
In China, the world’s largest e-commerce market, online sales are expected to grow by over 20% through 2020. Growth like this is being driven by the increasing popularity of mobile shopping and the rise of new players like Alibaba and JD.com.
The growing popularity of ride-hailing apps is changing the transportation sector in Asia.
Ride-hailing apps like Grab and Uber are becoming increasingly popular in Asia as they offer a convenient alternative to traditional taxi services. It’s having a significant impact on the transportation sector, as these apps are eating into the market share of traditional taxi companies.
In Singapore, for example, Grab now has a 65% market share of the ride-hailing market, up from just 20% in 2016. It has put pressure on traditional taxi companies, which have seen their stock prices decline in recent years.
The rise of streaming services is changing the media landscape in Asia.
Streaming services like Netflix and Amazon Prime are becoming increasingly popular in Asia, as they offer a convenient way to watch TV shows and movies without the need to buy or rent DVDs. It has a significant impact on the media landscape, as traditional broadcasters struggle to keep up with the competition.
In China, the world’s largest market for streaming services, over 500 million people are expected to be using them by 2025. Growth like this is being driven by the increasing availability of broadband internet and the rise of new players like iQiyi and Youku.
The growing popularity of social media is changing how we communicate in Asia.
Social media platforms like Facebook, WeChat, and LINE are becoming increasingly popular in Asia as they offer a sensible way to stay in touch with friends and family. It has a significant impact on how we communicate, as more and more people use these platforms to stay connected.
In China, for example, over 70% of people now use social media, up from just 20% in 2010. This trend is also starting to catch on in other Asian countries like Indonesia and India.