Templeton Emerging Markets Investment Trust Plc Analysis

Overview

Templeton Emerging Markets Plc aims to provide long-term capital appreciation for its investors, through investment in companies operating in emerging markets.

Performance

The following has been extracted from Templeton Emerging Markets PLC's full year results, released on 3 June 2026:

During the year to 31 March 2026 the performance of TEMIT was unusually strong, with a net asset value (‘NAV’) total return of +41.3% and a share price total return of +48.6%. These returns were well ahead of the benchmark’s +26.8% and the Board would like to congratulate our Investment Managers for another excellent year.

We have always believed that emerging markets should be treated as a long-term investment and we caution that not too much emphasis should be placed on any one year. Over five and ten years, TEMIT has produced NAV total returns of +38.2% and +220.3% respectively, in both cases beating the benchmark returns which were +12.8% and +89.3%. The Managers long-term track record was recognised in May 2025 when Chetan Sehgal and Andrew Ness were awarded Citywire’s highest rating of AAA, noting their consistent performance in managing TEMIT’s portfolio.

The year has not been without its geopolitical challenges. US President Trump’s “Liberation Day” was declared on the second day of the financial year. The announcement of the intention to impose widespread tariffs on imports into the United States from most countries was expected but both the levels and number of countries affected were much higher than predicted, leading to considerable investor anxiety and market volatility. By a year later, most of the tariffs have been struck down by the US Supreme Court but the situation, and the US government’s next steps, remain far from clear. China was clearly the key target of the US President but arguably it is too integrated into the global economy for economic sanctions to profit any party and, as seems increasingly apparent, it has the ability to play the long game whilst becoming less dependent on the US both as a supplier of technology and as a market for its products. As a result of the geopolitical tensions, both the NAV of the Company and its share price initially fell sharply but subsequently increased substantially over the summer, leading to a strong overall return for the first half of our accounting year, to the end of September.

Performance over the second half of our accounting year was, again, largely strong but towards the end of the period geopolitics again played a major part. The US and Israeli military attacks on Iran precipitated a sell-off in markets as it became apparent that Iran would continue to be able to impair the flow of oil from the region. Asia is particularly dependent on oil from the Middle East. As a result, over the month of March our NAV declined, tempering returns but still leaving us well ahead for the year.