Baidu Inc - ADR

The Fund’s largest positions in China include Baidu Inc, the 'Google of China,' and CGN Power Co, a leading Chinese nuclear utility.

Baidu represents a complementary exposure—a pure play on AI innovation and autonomous mobility. Its Apollo Go platform has completed more than nine million paid rides, operating fully driverless taxis in multiple major Chinese cities. The company’s latest sixth-generation robo-vehicles, produced at scale and at costs below $30,000 per unit, mark an industry breakthrough that could make commercial autonomy economically viable. Beyond mobility, Baidu’s AI capabilities extend across enterprise software, cloud services, and language model development, aligning the company with government and industrial partners seeking secure, domestically developed AI solutions.

We have concluded our third time investing in Baidu. On each occasion, we have achieved positive returns, although in this last one, the rapid deterioration of Baidu’s traditional business (online advertising) led us to adjust our valuation several times. We took advantage of the stock’s recent sharp rise, driven by the favorable expectations that the market is assigning to the artificial intelligence sector globally, to exit our position. While the company still appears attractively valued on the surface, we prefer to remain cautious and closely monitor the business transformation it is trying to implement.

Baidu is positioned to benefit from the resurgence of AI innovation in China, particularly through the adoption of DeepSeek's technology. This technology is enabling companies like Baidu to reduce costs and drive growth, marking a significant opportunity for the firm. The manager believes that the true value of AI will be realized by those who can effectively integrate it into their businesses, and Baidu is well-placed to capitalize on this trend as the market sentiment shifts positively towards growth in the Chinese economy.

Baidu is positioned to benefit from the resurgence of AI innovation in China, particularly through the adoption of DeepSeek's technology. This technology is enabling companies like Baidu to reduce costs and drive growth, marking a significant opportunity for the firm. The manager believes that the true value of AI will be realized by those who can effectively integrate it into their businesses, and Baidu is well-placed to capitalize on this trend as it continues to evolve.

Baidu is positioned to benefit from the resurgence of AI in China, particularly through the adoption of DeepSeek's technology. The manager notes that Baidu, along with other portfolio companies, is leveraging this innovation to reduce costs and drive growth. The belief is that the true value of AI will be realized by those who can effectively integrate it into their operations, suggesting a strong growth potential for Baidu as it navigates this transformative landscape.

The letter mentions Baidu in the context of new issuance, specifically noting a $2 billion Baidu into Trip.com 0% due 2032 exchangeable bond. However, there is no directional argument or specific investment thesis presented regarding Baidu's performance or outlook.

The letter mentions Baidu in the context of new issuance, specifically noting a $2 billion Baidu into Trip.com 0% due 2032 exchangeable bond. However, there is no directional argument or specific investment thesis presented regarding Baidu's performance or outlook.

The letter mentions Baidu in the context of new issuance, specifically noting a $2 billion Baidu into Trip.com 0% due 2032 exchangeable bond. However, there is no directional argument or specific investment thesis presented regarding Baidu's performance or outlook.

Baidu Inc is mentioned in the context of its performance, contributing positively to the Fund's returns. However, there is no explicit directional argument made about the company's future prospects or valuation.