Pangolin’s James Hay – Got Sacked, Backpacked and Makes a Comeback

UNEARTHING VALUE

Pangolin’s James Hay: Got Sacked, Backpacked and Makes a Comeback

James Hay lost his job as a stockbroker during the 1998 Asian Financial Crisis. He then dumped all the cash he had in a few stocks and left backpacking for a year. When he came back, the money he invested grew. He used this as an inspiration to start a fund house. Today, the fund he started – Pangolin Asia Fund is over RM 420 million in asset size. He speaks to AWANI Review's Ibrahim Sani.

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“Pangolin is Tenggiling in Bahasa Melayu” trumped James Hay, who founded the Pangolin Asia Fund back in 2004.

“This animal unearths rocks to find ants under it, and eats them” he continued. “The same can be said about Pangolin Asia Fund. We find these little jewel of companies and invest long haul in them. Today, the fund is over USD 120 million (RM 420 million) in size” declared the 55 year old British citizen.

James Hay first came to Malaysia in 1993 from London during the stock market boom in Kuala Lumpur. Unfortunately, he was sacked from his job in 1998 following the Asian Financial Crisis. “I then took whatever cash I had, dumped them in the stock market, and then went backpacking” he recollected.

“After about a year of bumming around, I came back and my portfolio grew. That’s my money growing without me doing anything. I invested in consumer stocks, and it paid off” he added.

The story of the ASEAN growth is one that is touted by many, but it seems James Hay has the clearest idea of them all.

“Just before we started this interview Ibrahim, we just had a Nescafé. In Malaysia, 1 in 4 consumers use a Nestlé product daily. It can be Maggi Goreng, Nescafé, Milo, or anything really. But consumer products are what a growing economy needs. And that’s why we simply love consumer companies” James said.

We don’t want companies to destroy forests - unsustainable and unethical firms. They simply do not add value to the society and to the net worth of the country

Pangolin Asia Fund invests mostly in Consumer companies like Nestlé and Padini. And they are clear in what they will not invest in. “We don’t want companies to destroy forests - unsustainable and unethical firms. They simply do not add value to the society and to the net worth of the country” James outlined.

Apart from this, while the fund is not an ‘activist’ investor, Pangolin Asia Fund is considered to be a rather active investor.

“We always turn up at AGMs and EGMs. Every time we attend, we question the management and the board on their practices. These guys, when they see me in their AGMs, they always shake their heads murmuring ‘not James again’” he joked. But taking an active position in the companies that they invest in, they can shape how the companies are run and push them to become more efficient.

“We don’t tell Padini how to sell clothes. They know this better than we do. But we do tell Padini how to manage their balance sheet” informed James. This is just one of the many investment and management examples he provided during his exclusive interview with Ibrahim Sani.

Watch the full video to learn about how James Hay manages a half a billion ringgit fund

Podcast of the interview: 

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