KUALA LUMPUR (Oct 14): The equity market in Asia Pacific “looks very cheap” compared to the US and Europe based on price earnings ratio and price to book valuation, said Eastspring Investments Bhd’s chief investment officer Chen Fan Fai.

"Asia looks cheap as compared to other developed markets. So at some point, investors will come around in the view that that they should pay more attention to Asia," he told pressmen at the Eastspring Investments' launch of the Asia Pacific Ex-Japan Target Return Fund today.

Chen said Asia as a whole is still the highest economic growth region, noting that the growth rate is relatively stable at about 6%.

He said while growth in the US market is slowing down and Europe is not growing, Asia is sustaining itself with a high growth rate coupled with very low valuation.

"When you sum these up, what it points to is that you should be looking at Asia," he reiterated.

Chen sees the Asia Pacific region to achieve GDP growth of between 6% to 6.2% this year. He forecast earnings growth to achieve 10% to 12%.

On the domestic front, he noted earnings forecast ranges from 10% to 11% based on analysts' consensus.

But Chen sees a downside risk on the cost side due to the impending implementation of the Goods and Services Tax (GST) next year.