Vedas Group Asia looks past market fads to find the next growth cycle

Key Points

Singapore single-family office Vedas Group Asia is looking beyond the current AI trade towards semiconductors, cybersecurity, biotech and financial infrastructure, while remaining prepared to rotate as those opportunities mature. “We don't have an animal spirits mindset,” principal Sridhar Chityala told AsianInvestor. “We just try to take our own approach in terms of our beliefs and our experiences.”

Sridhar Chityala
Vedas Group Asia

The family office's public-market research currently centres on five broad sectors: consumer staples, fintech-adjacent businesses, biotechnology, cybersecurity and semiconductors.

However, these are not intended to be permanent portfolio positions. “We think where the world will be in five years and what some of the challenges will be,” Chityala said. That means identifying structural change early, following where economic demand is likely to move and then reassessing the opportunity as an industry develops.

While many investors have spent the past two years crowding into AI-related trades, Vedas argues that the more durable opportunities often emerge further down the value chain. Rather than backing a particular technology or market theme, the family office seeks to identify structural shifts that reshape how businesses generate revenue, then position capital in the industries and infrastructure most likely to benefit as those changes unfold.

FOLLOWING THE REVENUE TRAIL

Vedas began examining semiconductors before generative AI turned chips into one of the market’s dominant investment themes. Its thesis was broader: computing was moving into electric vehicles, charging infrastructure, connected devices and embedded systems, creating demand for processing capacity across a growing number of industries.

The family office is now looking further along that chain, considering elements such as memory, embedded computing and the components required to enable more computing to move into vehicles and devices.

Chityala pointed to the current shortage of memory as an example of why investors need to understand where demand is actually travelling through a value chain rather than simply following its most visible part. That approach also means continually questioning what the market may be overlooking. “Nothing is permanent,” Chityala said. The question is which structural changes could strengthen, weaken or displace them over the next several years.

FINTECH MOVES BEYOND FINANCE

For fintech, it looks at the infrastructure enabling financial activity, including transaction technology, data, cybersecurity and computing.

Chityala is sceptical of repeated claims that each new wave of technology will overturn established financial products. “We have been hearing for 30, 40 years [that] payments are going to be disrupted, credit cards are going to be disrupted, mortgage is going to be disrupted,” he said.

Instead, Chityala makes a distinction between the technology itself and the economic opportunity it creates. “What we are buying into is not technology. What we are buying into is that segment of the market share,” he said. That is why Vedas includes fintech-adjacent businesses within its investment framework.

As financial activity becomes increasingly digital, cybersecurity becomes part of the financial infrastructure itself. More sophisticated computing and AI can also make cyber threats harder to identify and remediate, increasing the importance of security technology around financial networks.

Chityala is also particularly interested in real-time payment infrastructure and the ability to bring customer, payment and transaction information together more quickly.

For Vedas, that shifts the investment question away from identifying the next fashionable fintech company towards understanding which parts of financial infrastructure become more valuable as transactions themselves change.

It comes back to what Chityala sees as the discipline required in increasingly disrupted markets: going deeper into businesses to understand “what the revenue drivers are and where the revenues are flowing from” and then pursuing that revenue through the value chain.