Emerging markets investment guru Mark Mobius says the long-term story for China is still very bright, despite the sharp decline in Chinese stocks this year.
Mobius notes that prices of H shares (Chinese companies listed in Hong Kong) have been hit as a result of the declines on the Shanghai domestic market. "Now, you can pick up these stocks (H shares) at single digit price-to-earnings ratios," Mobius told CNBC's Asia Squawk Box Tuesday, and that's a substantial discount.
"Our best success in China has been in the private equity area," Mobius, executive chairman at Templeton Asset Management said. "For example, China High Speed -- we've went up 17 times in that stock."
"The other side is consumers. We'd love to get more exposure to consumers" Mobius said. Giordano and Esprit are two very interesting companies going forward if they can establish a strong presence in China, he added. (Watch the complete Mark Mobius interview on emerging markets.)
Mobius is also very keen on Russia. "I joked with someone the other day that we should put Putin up as president of the United States ... he's done the right thing for Russia at the right time," Mobius said.
He feels that the problems in Georgia have not diminished Russia's appeal as an investment. In some ways -- because Russia is now using its weight as an energy supplier -- this has strengthened its position at the bargaining table with Europe, Mobius added.