Templeton Emerging Markets Investment Trust (TEMIT) reported strong performance in February, with the net asset value returning 8.36 per cent over the month, compared with the MSCI EM Index-NR’s result of 7.68 per cent, both in UK-sterling terms.

South Korea-based semiconductor company SK Hynix and Hyundai Motor were amongst the strongest contributors. The former’s share price rose on the continued positive investment sentiment in artificial intelligence and a strong favourable outlook. Hyundai Motor rose as a result of the news of its investment plan into new growth ventures. An underweight allocation to Chinese tech company Tencent Holdings was also a contributor.

Overall, Sehgal increased investments in the financials sector. In terms of countries, he made purchases in Taiwan and India. He trimmed his exposure to South Korea-based automobile company Hyundai Motor to lock in profits on the back of a sustained rally in its share price. However, he remains optimistic on its automotive business and sees additional optionality from its robotics business.

Middle East conflict
Although the conflict has caused oil prices to surge, and created uncertainty and higher volatility in the market, Sehgal believes emerging markets still look relatively attractive in 2026. Their rise has been driven by artificial intelligence (AI) and tech, and he has not made big changes to the portfolio.

However, if the conflict is a long affair, Sehgal thinks that India could be hit hard, being a major oil importer. “China will also be impacted, but it is more self-sufficient in energy than India and imports gas from Russia. Brazil will also not be so affected,” he added.

Brazil has one of the world’s cleanest energy mixes with 89 per cent of its electricity coming from renewables, primarily hydropower, supported by a growing wind and solar sector. While China still relies on fossil fuels, it produces more than 80 per cent of all solar photovoltaic panels, half of the world’s leading electric vehicles and a third of its wind power. “The renewable energy sector could benefit from the oil price spike,” Sehgal continued. Sehgal invests in India’s Renew Energy and China's Daqo, a large producer of high-purity polysilicon for use in solar photovoltaic systems.

“I am overweight in Korea, where some of the world’s largest semiconductor companies are found, and Brazil,” he told this news service in an interview this week. He has added to his exposure in Korea and invested in some beaten down names in India, including tech multinational Pine Labs. Meanwhile, he has trimmed his exposure to the United Arab Emirates.

TEMIT, which has outperformed the index over a five-year period, aims to provide long-term capital appreciation through investment in companies in emerging markets or companies which earn a significant amount of their revenues in emerging markets but are domiciled in, or listed on, stock exchanges in developed countries.

Top 10 holdings include Taiwan Semiconductor Manufacturing Company (TSMC), the fund’s largest holding, as well as South Korea’s Samsung Electronics, the largest global producer of DRAM chips which has benefited from the price increase of DRAM and NAND flash memory chips – driven by demand for generative AI. Sehgal also invests in South Korean SK Hynix, the world’s second largest maker of memory chips and supplier of semiconductors.

Chinese tech giants Alibaba and Tencent are also in the top 10, as well as Taiwan-headquartered tech firm MediaTek. Other holdings include India’s ICICI Bank. TEMIT also reported strong financial results in the year ending March 2025, with a share price total of 13.3 per cent. 

His stance is shared by others. London-headquartered remains quite positive about the outlook for these markets which outperformed developed ones in 2025, driven by a weaker US dollar, stronger relative earnings revisions and improving return on equity (ROE). Corporate governance has also been improving in the region. Samy Chaar, chief economist, CIO Switzerland at Swiss private bank , also told this news service this month that he will remain invested in Asia, despite the conflict which sent oil prices to new highs, strengthened the dollar, and made emerging market assets and oil importers more vulnerable.

See more about emerging markets and TEMIT here and here.