In this analysis, we’re going to talk about my largest position at the moment: Prosus. By investing in Prosus, you’re essentially buying Chinese tech giant Tencent at a discount, and (for now) you’re getting all the other parts of Prosus thrown in ‘for free’. Prosus is a Dutch investment company that focuses on internet businesses around the world, particularly in emerging markets. Think of it as a kind of tech-focused investment fund. That said, 80–90% of its value comes from its stake in Tencent. Through Prosus, we can buy Tencent at a discount. Tencent is China’s most dominant company. It owns the super-app WeChat, which the Chinese population is almost entirely dependent on. Tencent is also the largest video game producer in the world, and holds a well-stocked investment portfolio. The negative sentiment around China and the risk of government interference make the valuation particularly attractive. Now, Prosus itself is by no means the strongest or most beautiful company out there. In fact, I often find the decisions made by the company and its new CEO to be far from strong. But this is a textbook case of a “heads I win, tails I don’t lose much” type of investment. This analysis is my way of testing my conviction and thesis, and figuring out what I should, or want to, do with this position. Disclaimer: Nothing in this podcast can be considered financial advice. This is for educational purposes only. We may hold positions in the businesses discussed. Do your own research. You can also find us on: X @DutchInvestors Substack @The Dutch Investors Instagram @The Dutch Investors
