Mobius favours China consumer firms, frontier mkt Nigeria

* Says govt focus positive for China consumer firms

* Concerned by potential steps to restrict trade, investment

HONG KONG, Dec 6 (BestGrowthStock) – Firms that can tap China’s
rising consumer spending are the top picks for Templeton fund
manager Mark Mobius over the next 12 months, as the world’s most
populous nation aims to boost consumption.

The veteran emerging markets specialist, who spoke to Reuters
Insider, said firms in sectors such as food, clothing,
restaurants and services, could pose good investment
opportunities as the consumers in China get wealthier.

“Per capita income is moving up at a very rapid rate. The
government wants more consumption locally. And there are more
consumers in China than probably anywhere else, except in India.
So, that’s a place to be,” said Mobius, who oversees more than
$40 billion as chairman of Franklin Templeton’s Emerging Markets
Group.

Speaking to Reuters Insider on Friday, he said the increase
in money supply will result in higher inflation, but that will be
tempered by rising productivity in both China and India.

Inflation will not be as bad as people may expect and the
policy tightening measures are not going to be excessive and
general, he said.

“In other words, they don’t want to kill the growth that we
have seen. But at the same time, they want to attack those
pockets of excess, and that’s the way they will handle it,” he
said.

Mobius is more concerned about any step that could restrict
trade and investment, he said.

“As you know, there had been noises in the U.S. and in Europe
about that. And if this comes to pass, then it will not be good
for anyone, including emerging markets, of course.”

The fund manager said he was very confident about China’s
long-term potential as the economy turns more diversified and
pockets of opportunity emerge in different parts of the country.

“You are going to see the economy moving from the coast to
the interior. So the opportunities are going to be boundless.”

EMERGING MARKETS

Aside from opportunities in the so-called BRIC countries —
Brazil, Russia, India and China — the veteran money manager sees
favorable prospects in frontier markets, citing resource-rich
Nigeria a his top bet.

“I know it’s way out in terms of people’s minds. The risks
are there of course. But it’s a big country, it’s one of the
biggest in Africa, and it’s a fast-growing country, so I think
there’s a great opportunity there,” he said.

The money manager, who has made his name by picking stocks in
the emerging markets, said the biggest risk was that too much
money would be invested in the market, chasing too few stocks.

The good news in 2010 was that initial public offerings and
secondary issues are expected to double the amount they raised in
2009 and flows are coming in to funds.

“But that balance is very, very important because you’ve got
to get this money in a home where it’s relatively safe. And some
of these IPOs are in pretty good shape, so that’s something we
have to watch very carefully,” he said.
(Reporting by Reuters Insider and Nishant Kumar; Editing by Ken
Wills)

Mobius favours China consumer firms, frontier mkt Nigeria