China

Premia Partners’ look at an atypical, tech-enabled CNY holiday

Premia Partners, a leading ETF investing provider, shares its look at the impact on the Coronavirus on 2020’s Chinese New Year celebrations, which this year were marked by extremely busy traffic online, rather than the traditional gatherings with relatives and friends, or bustling tourist scenes in cities like Shanghai.

Thanks to technology, explained Premia Partners, China saw an unconventional yet "lively" CNY holiday online. Part of this was due to the emergence of Digital Red Packets, as peoples’ efforts to contain the virus prevented the exchange of packets face-to-face.

Digital Red Packets were a tradition started by Tencent in 2015 as part of their National Spring Festival Gala, according to an article by Rainie Pan, Vice President – Strategy & Analytics, Premia Partners. In 2020, the short-video platform Kuaishou and Alibaba’s Taobao gave away an alleged RMB1 billion Digital Red Packets, all via mobile phones.

The unusual circumstances of 2020’s CNY also saw a spike in online gaming. Hugely popular online games such as Honor of Kings and Player Unknown’s Battle Grounds saw a combined daily player count of up to, if not greater than, 250 million. Social games, such as Werewolf, a derivative of the popular party game Mafia, also drew a large crowd during the festive period.

Online Streaming saw boosted traffic as those would-be moviegoers were confined to the home cinema experience. Lost in Russia, a film which underwent an online-exclusive premiere on Douyin, the Chinese answer to TikTok, drew a greater audience than anticipated. Other video and streaming platforms like Tencent Video, iQIYI, Mango TV and Bilibili also became top alternative home entertainment for many households, according to Pan’s article.

Online shopping platforms, in the words of Pan, absolutely contributed to the society’s overall productivity and convenience throughout this special period. Masks, hygiene products, food, and more saw boosted sales for E-commerce platforms like Taobao, JD.com and Pinduoduo. These services also meant that individuals would not have to venture outside for resources, meaning that the appearance of crowds was reduced, helping the prevention of the spread of viruses.

The Premia Asia Innovative Technology ETF (3181 HK / 9181 HK) is proud to hold not only these leading technology firms that provided people comfort, entertainment and convenience in this unusual new year, but also leading healthcare and biotech companies that are at the forefront fighting against the virus as well as those in factory automation and public security that allows more efficient response to the outbreak vs. the SARS epidemic in 2003, according to Pan.

It is unfortunate that the dominant story this Chinese New Year has been the coronavirus epidemic that the usual mood of festival celebration is replaced with concerns about domestic health issues and global economic outlook.  But on the bright side, it is consoling to see that technology and technology-enabled innovation leaders has become an irreplaceable backbone of the society, empowering connectivity, efficiency and productivity.