1. BYD
BYD is not just an electric vehicle company; it is a vertically integrated energy and mobility platform
with exposure across EVs, batteries, energy storage, power electronics, and rail transport. Unlike most
global EV peers that rely heavily on external suppliers, BYD manufactures its own batteries,
semiconductors, motors, and power management systems, giving it unmatched cost control and
supply-chain resilience. This vertical integration allows BYD to sustain profitability even during
aggressive price competition, a phase where many global EV manufacturers struggle to break even. Its
scale advantage in lithium-iron-phosphate (LFP) batteries, which are safer and cheaper than nickel-
based chemistries, positions BYD as a dominant force not only in EVs but also in stationary battery
energy storage systems (BESS).
From a long-term equity perspective, BYD benefits from multiple structural tailwinds: electrification of
transport, decarbonisation of power grids, and global demand for energy storage. The company is
increasingly global, expanding aggressively into Europe, Southeast Asia, and Latin America, reducing
reliance on the Chinese market. Its balance sheet strength, strong operating cash flows, and disciplined
capital allocation allow it to self-fund expansion without excessive dilution. BYD’s ability to participate
across EVs, batteries, and grid storage makes it a rare compounder at the intersection of mobility and
energy, with decades of growth visibility.
2. ASML
ASML is arguably the most strategically important company in the global semiconductor ecosystem,
holding a near-absolute monopoly over extreme ultraviolet (EUV) lithography machines, which are
essential for manufacturing advanced chips below 7 nanometres. No modern AI processor,
smartphone chip, or high-performance computing chip can be produced without ASML’s machines.
The company’s technological moat is reinforced by decades of R&D, thousands of patents, and an
ecosystem of suppliers that is practically impossible to replicate. This creates extraordinary pricing
power, long order visibility, and switching costs that are among the highest in global industry.
From an investment standpoint, ASML benefits from every major semiconductor trend without
bearing product-cycle risk. Whether AI demand accelerates, chips get smaller, or governments reshore
semiconductor manufacturing, ASML captures value as a critical enabler. Its customers TSMC, Intel,
Samsung are forced to invest continuously to remain competitive, ensuring repeat demand. Despite
being exposed to cyclical semiconductor capex, ASML’s monopoly status, high margins, and backlog-
driven revenues make it one of the highest-quality long-term compounders in the world, with strategic
importance that transcends economic cycles.
3. Eli Lilly
Eli Lilly stands out in global healthcare due to its leadership in metabolic diseases, particularly diabetes
and obesity, through its GLP-1 drug portfolio. Obesity is increasingly recognised as a chronic disease
with massive healthcare implications, and Lilly’s drugs have demonstrated superior efficacy, driving
unprecedented demand globally. This positions the company at the centre of one of the largest
pharmaceutical markets of the next two decades. Unlike traditional pharma companies dependent on
patent cliffs, Lilly has a deep pipeline and strong execution capability, allowing it to reinvest current
cash flows into future therapies.
