Michael Burry’s investment firm doubled down on its bets on JD.com Inc and Alibaba Group Holding Ltd. in the first quarter as Chinese equities bottomed out.

JD.com was Scion Asset Management’s top holding after the firm boosted its stake in the e-commerce operator by 80% during the period, according to the most recent 13F filing. Alibaba was its second-biggest position with total value at around $9 million, after the firm added a further 50,000 shares.

Burry, made famous by the book The Big Short, has been making a return to Chinese tech shares after exiting them at one point in 2023. The wagers appear to be paying off, as Chinese policymakers’ efforts to stem a rout and signs of improvement in earnings spur a rebound in the troubled market. JD.com’s US-listed shares have climbed more than 16% this year while Alibaba’s have increased about 4.5%.

Baidu Inc.’s American Depositary Receipts, which Burry added a small $4.2 million stake, are still down 7% this year.  

Global investors have been making a cautious return to the Chinese stock market as cheap valuations and Beijing’s policy support allowed a number of equity benchmarks to roar into bull markets. A sustainable growth in earnings is seen as crucial for the rebound to continue. Tencent Holdings Ltd. beat earnings estimates while Alibaba reported weaker-than-expected profitability.

Burry, who rose to fame predicting the 2008 US housing crash, has been moving in and out of his China tech bets over the past years. He snapped up shares of New York-listed Alibaba and JD.com at the end of 2022 as China was emerging from the pandemic. He ended up closing out his positions in the second quarter of 2023, only to reopen them months later.

This article was provided by Bloomberg News.