Roshan Padamadan of Luminance Capital presented his investment thesis on Fosun International (HK: 0656 / OTC: FOSUY) at Asian Investing Summit 2025.
Thesis summary:
Fosun International is a sprawling Chinese conglomerate with a globally diversified asset base across healthcare, insurance, consumer products, tourism, and financial services. Following a period of aggressive expansion, Fosun has recently pivoted toward debt reduction — a slow but steady process that is unlocking disproportionate equity value. With over 50% of revenues now generated outside China and holdings in well-known names such as Fidelidade (Portugal), Club Med (France), Cirque du Soleil (Canada), and Gland Pharma (India), Fosun has evolved from a domestic industrial group into a diversified international operator with a unique east-west footprint.
The company recently traded at HKD 4.3 per share, giving it a market cap of HKD 35.2 billion (USD 4.6 billion). Despite having a broad portfolio of operating businesses, the shares were priced at just 0.27x book and 0.18x sales as of early April 2025. While its debt/equity ratio remains high at 1.9x, Fosun has made visible progress on deleveraging, including asset sales of over HKD 30 billion in 2024 alone. Credit markets have responded favorably, with its CDS tightening from 350 bps to near 300 bps over the last two years, and all major rating agencies now maintaining a stable outlook.
Operationally, Fosun remains resilient, with profitability spread across four segments — Health, Happiness, Wealth, and Intelligent Manufacturing — all of which reported profits in 2024. The company is exposed to varying degrees of competition and cyclical risk, particularly in tourism and financial services, but maintains strong geographic diversification, with nearly half of revenues now generated outside China. Despite these assets, market skepticism persists, in part due to the company’s complex structure, its prior ties to China’s property sector, and a modest dividend and buyback program.
Nonetheless, Fosun presents a compelling deep value opportunity for patient investors. With a high-quality global portfolio, tangible progress on debt repayment, and a share price disconnected from intrinsic value, the business offers significant upside potential. As deleveraging continues and market confidence improves, even a partial re-rating to 0.5x book or 0.5x sales could yield material returns. In a market eager for transparency and capital discipline, Fosun’s slow but determined pivot may be precisely the kind of underappreciated transformation that long-term investors should not overlook.
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About the instructor:
Roshan Padamadan is Chairman at Luminance Capital. He is a global investor and splits his time between New York, Singapore and India. Previously, he served as COO, Risk and Compliance officer at Sixteenth Street Capital, based in Singapore. His erstwhile Luminance Global Fund had a global unconstrained investment strategy, looking at special situations and deep value. Prior to launching Luminance in 2013, Roshan also spent more than seven years with the HSBC Group, including more than three years with HSBC Asset Management, as a Product Specialist. He worked for the highly commended Offshore Indian Equity team which ran US$5+ billion from Singapore, including a US$100+ million award-winning India hedge fund. Roshan has earned an MBA in Management from Indian Institute of Management, Ahmedabad. He holds the CFA and CAIA charters and speaks over five languages.