5 Best China Stocks to Buy Now

2. Pinduoduo Inc. (NASDAQ:PDD)

Number of Hedge Fund Holders: 49

As the Chinese government announced to make its home-grown internet in the coming years, Pinduoduo Inc. (NASDAQ:PDD), an agriculture-focused technology platform, remains one of the best China stocks to buy now. Recently, Barclays initiated its coverage on Pinduoduo Inc. (NASDAQ:PDD) with an Equal Weight rating and a $130 price target, highlighting the positive growth in China’s tech sector.

In Q2, 49 hedge funds tracked by Insider Monkey reported owning stakes in Pinduoduo Inc. (NASDAQ:PDD), down from 56 in the previous quarter. The total value of these stakes is over $5.2 billion. In Q3, Tiger Global Management is the largest shareholder of Pinduoduo Inc. (NASDAQ:PDD), with shares worth $1.2 billion.

Baillie Gifford mentioned Pinduoduo Inc. (NASDAQ:PDD) in its Q2 2021 investor letter. Here is what the firm has to say:

“As many countries enjoy a relaxation of Covid restrictions, Mr Market is focussed on short-term beneficiaries of ‘the pleasure after the plague’. There are interesting parallels with the Roaring 20s here, but to our minds, they extend beyond post-pandemic hedonism. Much of the new wealth created in the 1920s was patchily distributed and accompanied by a pervasive sense that the older generation had let down younger people. In 1920, John F. Carter, an irate 23-year-old wrote “the older generation had certainly pretty well ruined this world before passing it on to us. We have been forced to live in an atmosphere of ‘tomorrow we die,’ and so, naturally, we drank and were merry.”

In a similar vein, some of the greatest Growth opportunities are materialising from the companies that are shifting humankind towards more sustainable ways of consuming by driving efficiencies and eliminating surplus. Pinduoduo’s ‘farm to table’ platform is one example – cutting out huge waste in farm produce and short circuiting layers of infrastructure by matching Chinese food supply and demand through a group buying model. In a similar vein, Meituan is well on the way to developing China’s primary ‘Software as a Service’ ecosystem for food distribution which we believe has a strong chance of replacing wasteful wet markets as the primary channel for transacting in produce.

Pinduoduo’s share price pulled back following news that Chinese regulators are investigating possible anti-competitive activities by the country’s large online companies. However, Pinduoduo appears well placed to navigate such regulatory scrutiny in the long-term, helped in part by its community buying business model that benefits consumers, manufacturers and farmers alike. Its business fundamentals are stellar– the company remains the largest Chinese e-commerce platform, with over 820 million annual active users (surpassing Alibaba and JD.com), while revenue growth increased by 239% over the previous year.”