SINGAPORE, July 9 - Fund managers in Asia voiced guarded optimism about artificial intelligence at a conference in Singapore, saying they are directing capital both to firms that could benefit from AI adoption and to businesses they consider more resilient to its disruptive effects.
Speakers noted that global markets have climbed to record levels driven largely by enthusiasm for AI. Yet they said questions have emerged over whether the rapid profit gains can be sustained and whether the heavy investments in AI infrastructure will generate strong returns.
Those doubts were evident at a regional investment event in Singapore where executives managing large pools of capital discussed how they are assembling portfolios in an AI era. Rohit Sipahimalani, chief investment officer at Temasek, described a twofold approach in an interview at the event.
"You want to ride that trend," Sipahimalani said, noting Temasek aims to increase its AI investment. He also emphasised the risk of AI-driven disruption to many businesses. "But the equally big issue is disruption because of AI to many other businesses... We’ve increased our exposure to businesses that are more around hard assets, which are likely to be less disrupted by AI," he said.
Temasek, which holds stakes in Anthropic and OpenAI, is planning a substantial rise in its AI allocation. The firm said on Wednesday it is targeting an increase in exposure to AI-related investments to as much as 15% over five years from 6% at present.
"You’ve got to look at the entire value chain," Sipahimalani added, distinguishing between areas displaying froth and those delivering tangible cash flows. "There are some areas where there’s froth, the other areas where there’s real cash flows." He said the investor tries to play across the full spectrum of opportunities.
Investors have long expressed scepticism about outsized gains in AI and semiconductor equities, warning that steep valuations and volatile selloffs could point to speculative excess. In response, some managers are moving further down the AI value chain, focusing on enabling technologies and infrastructure rather than headline-facing applications.
Stephanie Hui, head of private and growth equity for Asia-Pacific at Goldman Sachs Asset Management, characterised the current moment as too early to predict which AI applications will prevail. "I am not smart enough to tell you today which applications are going to be winning, it’s way too early," she said during a panel. She described her firm’s strategy as looking for simpler plays that facilitate AI deployment rather than betting on the front-end winners.
Hui said her firm has invested in a company that specialises in liquid cooling as well as in data centres, explaining: "We are not going for the front end at this moment... We are going for the simple stuff that facilitates an end proxy for AI adoption."
While panelists broadly agreed that AI remains a dominant market theme, they also flagged caution about the scale of capital being directed into the sector and the potential for an AI-driven market bubble.
Fred Hu, chairman of China’s Primavera Capital Group, said he supports the AI revolution but warned that rising valuations and growing capital flows into AI prompt a fundamental question: "how much is enough." He cautioned against excessive enthusiasm in the markets as AI investment intensifies.
Satoshi Ueyama of Bain Capital Japan said investment opportunities are abundant but stressed that AI infrastructure projects require actual end-users to justify the expense. Ueyama said his firm concentrates on identifying AI-enabled winners across sectors, including services and consumer applications.
"AI is real but at the same time there’s no denying some parts of the markets are over-excited... Not all AI investment is going to be successful at this stage," Ueyama said at the panel in Singapore.
Overall, speakers signalled a balanced stance: they intend to participate in AI-driven growth while increasing allocations to companies and asset types thought to be less exposed to technological disruption, and by targeting segments of the value chain where cash flows are more evident.