Apart from the past week or so, the stock market has been in the doldrums of late, with many fretting that investment sentiment is poor due to political uncertainty. But Aberdeen Asset Management chief executive Robert Penaloza thinks otherwise.

Penaloza says now is the time for the company to seek opportunities.

"It's an educational time to be a fund manager in Thailand, because it's undergoing so much change.

"I'm glad about where Aberdeen is positioned, the strength of the company financially and the acceptance of our products," says Penaloza, an Australian.

In early 2005 Aberdeen spent Bt245 million buying out the local unit. The local venture was originally established in 1994 by Nakornthon Bank - which was once owned by the Wanglee family - and Schroder Investment Management.

After the 1997 financial crash the Wanglees held 20 per cent while Schroder held the remainder.

Schroder later sold to the Wanglees, who then sought another foreign partner. It needed expertise.

Aberdeen took an initial 40-per-cent stake with an option to take an additional 11 per cent after three years.

However, the Wanglee family decided to sell its entire stake rather than be a minor partner.

With no bank to provide exclusive support - and operating in a young mutual-fund market - Aberdeen had a doubly tough task to expand amid intense competition.

There were 18 other players in the industry with 12 of them backed by local banks.

But over the past three years Aberdeen's assets under management have grown from Bt9.78 billion to Bt32.71 billion in mid-May.

There is no magic formula. Success comes from performance. Although Aberdeen has just 2.31 per cent of the market, "sophisticated investors are aware of its equity funds".

"We identify clearly the area we feel we are more competent in. We're able to demonstrate we're different from the rest of market," says Penaloza.

Aberdeen's equity fund invests in 30 stocks. Fund managers visit these companies to monitor performance. This style has been widely adopted by other asset-management companies.

After letting its funds speak for themselves, Aberdeen's next move was to launch a fixed-income fund. It is traded for profit rather than held until maturity.

Penaloza says Thailand was not ready for this.

"Appetite depends on the product and sentiment. For us, we don't necessarily add to the noise. And we want to make sure what we're coming out to the market in Thailand with is different. We want to clearly differentiate ourselves for the competition."

"It will damage our reputation to launch a product that we know might make a quick buck but in terms of investment return might not necessarily be the product for investors."

"History shows competitors have launched flavour-of-the-month products. but has this necessarily been good for the long-term product? When they go wrong, they go horribly wrong. That's when a company starts having problems with its reputation," he adds.

In terms of asset size Aberdeen is small, but Penaloza is not worried.

"Some may say we haven't done much while our competitors are more aggressive. To be honest, I really don't care. That doesn't keep me up at night," says Penaloza.

"We just focus on our customers and our products and work out how to get the key, the click.

"What challenges me is how to train staff and how our staff educate clients. We are expanding distribution channels and marketing by turning what we do at the international level to the local market."

He accepts it could take years before Aberdeen introduced more sophisticated products to Thailand. However, he says Aberdeen is patient.

"It's not about grabbing it now. We're learning every day. All of these uncertainties, political changes, capital controls - it's just building our experience.

"I think it's a good thing for us. In the short term, when investors don't see returns, I feel their unhappiness, but over time they can look back and say ours is a genuine product, a professional one."

Piyarat Setthasiriphaiboon

The Nation