Aberdeen Asian Income Fund half-year results: 30.9% share price total return and a 6.3% yield

Aberdeen Asian Income Fund Limited has delivered a punchy first half, with both its net asset value and share price ahead of the MSCI AC Asia Pacific ex Japan Index.

In its original company announcement, the company reported a 30.9% share price total return for the six months to 30 June 2026, compared with a 25.7% total return from the index. Net asset value total return was 28.0%.

For retail investors, the headline is fairly simple: the fund had a strong period, its shares performed better than the portfolio value, and its dividend yield remained high at 6.3% on an annualised basis.

But the detail matters, because the performance was heavily helped by Asian technology stocks, particularly those linked to artificial intelligence demand.

The key numbers

Net asset value, or NAV, is the value of the fund's assets after liabilities. Total return includes both capital growth and dividends reinvested.

Measure	Six months to 30 June 2026	Year to 31 December 2025
NAV total return	28.0%	22.2%
Share price total return	30.9%	30.0%
MSCI AC Asia Pacific ex Japan Index total return	25.7%	21.3%
Dividend yield	6.3%	6.2%
Revenue earnings per share	12.36p	14.73p
Net gearing	7.6%	4.7%
Discount to NAV	5.7%	7.6%
Ongoing charges	0.85% forecast	0.92%

That is a clean set of half-year figures. The fund beat the index on both NAV and share price total return, the discount narrowed, revenue earnings rose against the first half of 2025, and forecast ongoing charges fell.

The share price return was particularly strong because the discount narrowed from 7.6% at the start of the period to 5.7% at 30 June. A discount means the shares trade below the value of the underlying portfolio. When that gap narrows, shareholders can receive an extra boost on top of the portfolio return.

Investors can follow the company page for Aberdeen Asian Income Fund Limited for more updates.

Technology drove the first-half gains

The Chair, Jane Routledge, said performance was driven principally by exposure to information technology, especially companies linked to artificial intelligence, or AI, demand and related supply chains.

Semiconductor and hardware holdings in Taiwan and South Korea were especially strong. The RNS named MediaTek, Taiwan Union Technology and Samsung Electronics as key contributors. Other AI-enabling technology companies also performed well, including Grand Process Technology and ASE Technology.

The portfolio's largest holdings at 30 June 2026 underline that tilt. Taiwan Semiconductor Manufacturing Company was the top position at £73.6 million, representing 13.5% of total assets. Samsung Electronics was second at £64.6 million, or 11.8%, followed by SK Hynix at £39.0 million, or 7.1%.

The top ten holdings accounted for 51.3% of total assets, while the top twenty represented 67.4%.

That concentration is not automatically a problem. It can be useful when the fund's best ideas are working. But it does mean investors should understand what has been powering returns. In this period, technology exposure did a lot of heavy lifting.

Where the portfolio struggled

The report was not all victory laps.

The company said gains were partly offset by weaker performance in areas more exposed to domestic demand. Consumer and financial holdings in China detracted, reflecting weak consumer confidence and the continued negative wealth effect from the property downturn.

That is an important counterpoint. Asian equity income is not a single-theme story. The portfolio has exposure across countries and sectors, and not all of those areas are moving in the same direction.

The Chair also noted that market volatility in AI, semiconductor and related technology stocks has increased since the period end. That is not a forecast of trouble, but it is a useful reminder that the same area that helped returns can also introduce swings.

Dividends: higher, but linked to NAV

Aberdeen Asian Income Fund's enhanced dividend policy was introduced at the beginning of 2025. Under the policy, the dividend is set at 1.5625% per quarter of NAV, equivalent to approximately 6.25% of NAV per year.

For 2026, the first and second interim dividends declared were 4.47p and 5.55p per share respectively. The second interim dividend is payable on 21 August 2026 to shareholders on the register on 24 July 2026.

Based on the share price of 335p at 30 June 2026, and the first and second interim dividends already declared, the annualised share price dividend yield was 6.3%.

The positive point is that strong NAV growth has fed through into higher quarterly dividends. The first and second interim dividends for the current financial year increased in aggregate by more than 30% compared with 2025.

The caveat is equally important. Because dividends are linked to NAV, they can fall if the NAV falls. The Board said there may be periods when the NAV, and therefore the dividend, declines.

The company also repeated that, in years when net revenue is below the level required for a fully covered dividend, dividends may be funded from a combination of revenue and capital reserves. In plain English, the fund may use reserves rather than current-year income alone to support payments.

That is allowed within the investment company structure, but income-focused investors should not treat the dividend as fixed.

Portfolio changes show a broader search for income and growth

During the period, the Investment Manager added selectively beyond information technology, including financials, industrials and consumer companies with cash generation and long-term dividend potential.

New or added positions included Aristocrat Leisure, Vietnamese electronics retailer Dien May Xanh, Santos, Contemporary Amperex Technology and Ventia. Within technology, Hon Hai Precision Industry and Grand Process Technology were added.

Exits focused on lower-conviction holdings and selected real estate positions. The fund sold Centuria Industrial REIT, Centurion Accommodation REIT and Charter Hall Long Wale REIT.

This matters because the Board is keen to present the fund as diversified rather than simply an AI and semiconductor vehicle. The repositioning was undertaken ahead of recent weakness in AI and semiconductor stocks, according to the RNS.

Gearing has risen

Net gearing increased from 4.7% at 31 December 2025 to 7.6% at 30 June 2026. Gearing means borrowing money to invest, which can amplify gains when markets rise and magnify losses when markets fall.

The company has a £50 million evergreen loan facility with Bank of Nova Scotia, London Branch. At the period end, £40.7 million was drawn. The facility can potentially be increased to £70 million, subject to lender credit approval.

The higher gearing was helpful in a rising market, but it is still a risk factor for investors to keep on the checklist, particularly after such a strong run.

Why this RNS matters for investors

The positives are clear. Aberdeen Asian Income Fund outperformed its benchmark over six months, one year, three years and five years on both NAV and share price total return. Revenue earnings per share rose to 12.36p from 8.75p in the first half of 2025. The discount narrowed, and the annualised yield remained attractive at 6.3%.

The risks are also plain enough. The recent performance has been helped by AI-related technology holdings, an area the company says has seen increased volatility since the period end. The dividend policy is linked to NAV, so payouts can move down as well as up. Gearing has increased. China consumer and financial holdings detracted, showing that parts of the Asian opportunity set remain difficult.

For investors already watching Asian income funds, this is a strong half-year report. The more nuanced question is how much of the recent return reflects sustainable broad-based portfolio strength, and how much reflects a powerful run in technology and semiconductor names.

The next test is whether the fund can keep delivering income and capital growth if market leadership broadens, or if the AI trade becomes choppier from here.