Which types of consumption in which
countries will benefit the most in Asia?
􀂄 What are the best consumption exposures in Asia?
Rapid economic growth in Asia has been accompanied by strong consumption
growth as Asians move from predominately subsistence, agricultural-based living
to urban, income-earning lifestyles. But which types of consumption in which
countries will benefit the most over the next five years, and which companies are
best placed to take advantage of this growth?
􀂄 6 consumption themes, 9 investment themes & 180 consumption forecasts
We examine six consumption themes and look at how they correlate with countries’
social and economic structures. We highlight economic, demographic, development,
income distribution, geographic, and urbanisation characteristics that benefit particular
types of consumption. We identify which characteristics each country in Asia has and
use this mapping to link the consumption themes to particular countries to derive nine
investment themes. We then propose 18 stock ideas based on these themes.
􀂄 Country and consumption preferences
Our preferences include food diversification in China and India, health expenditure in
China, India and the Philippines, mortgage exposure in India, Indonesia, the Philippines
and Thailand, education consumption in China, India and Indonesia, death services in
Australia, China, Hong Kong, Korea and Singapore, and e-commerce in Japan.
􀂄 18 key Asian consumption stock picks
Our key stock picks include Chinese meat processor China Yurun, Indian tobacco
company ITC, Australian and Singaporean funeral home operator Invocare, Japanese
low-cost furniture retailer Nitori, Korea personal goods company LG Household and
Health Care, and global medical, lighting and appliance company Philips.

Contents page
Executive summary 3
Consumption themes 7
— 1) Contribution of private consumption to GDP.....................................................7
— 2) Stage of development ....................................................................................14
— 3) East vs west...................................................................................................21
— 4) Extreme consumption ....................................................................................27
— 5) Rural vs urban................................................................................................33
— 6) Aged consumption .........................................................................................46
Consumption in the future 54
Investment themes and stock picks 60
Food 64
Health 69
Education 75
Death 80
Telecommunications 84
Consumer finance 87
Advertising expenditure 91
Country-specific consumption 95
Cyclical companies in countries with relatively robust near-term
consumption outlook 99
Appendix 1: International context 108
Appendix 2: Key countries—China 132
Appendix 3: Key countries—India 134
Appendix 4: Key countries—Japan 138
Appendix 5: Key countries—Korea 140
Appendix 6: Key countries—Indonesia 143
Appendix 7: 13 Asian consumption facts 146
Appendix 8: Consumption category definitions 147