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Thursday, 24 April 2014


China’s state firm shakeup gets it only half right

24 April 2014

Private shareholders can bring extra discipline to the country’s 150,000 state-owned enterprises. CITIC and Sinopec have set the ball rolling. But for real efficiency, SOEs need to pay market rates for debt as well as equity. The key is to get on with half-finished bank reforms.

Edward Hadas: Inheritance can be less unequal

23 April 2014

Family is a big part of destiny, even when opportunities are supposed to be equal. Since children tend to take after their parents, the elite tend to be self-perpetuating, and poor kids will tend to become poor adults. Still, there are ways to soften the injustices of birth. 

A Sinopec gas station is seen behind traffic lights in Hong Kong April 26, 2010

Sinopec retail sale is key to topping up its value

23 April 2014

The state-owned Chinese oil group is seeking investors for up to 30 pct of its petrol station arm. Though comparisons are tricky, multiples for other operators suggest a valuation of at least $50bln. A sale at that level could prompt a revaluation of the rest of Sinopec.

Asia inflation surprises drive bond yields

Missing inflation could make Asian bonds frothier

21 April 2014

Prices of goods in the region are rising more slowly than expected. Inflation drives bond yields up; a lack of it could send them downward, even though the U.S. Fed is threatening to edge up rates around the world. Asian debt is already pricey – it may get yet more expensive.

A pig breaks out of a swinery before being sold on a street in Zhulin county of Jiaxing, Zhejiang province March 15, 2013.

WH Group’s chopped IPO still looks unappetising

23 April 2014

The Chinese pork producer is slashing its offering to as little as $1.3 billion. But its reluctance to cut the share price won’t tempt investors turned off by the fat valuation. With an overhang of private equity shareholders and a hefty debt burden the IPO remains a tough sell.

Soldiers of the People's Liberation Army's guard of honour hold flags in front of Beijing's Tiananmen Square during the official welcoming ceremony for Serbian President Tomislav Nikolic outside the Great Hall of the People in Beijing August 26, 2013.

Graft purges don’t hurt shareholders - insiders do

22 April 2014

The sacking of China Resources’ chairman will worry other state company bosses. But shareholders in Chinese groups have less to fear from government crackdowns on powerful individuals than the culture of treating outside investors as an afterthought. This remains unaddressed.

Men attend the recording of an episode of "Meet you on Saturday", a matchmaking television programme, at a local local television station in Shanghai July 28, 2013.

Chinese internet TV makes investors boggle-eyed

21 April 2014

Valuations are soaring despite a global tech sell-off, as companies eye an audience that could hit 77 million by 2015. But it’s unclear how China’s couch potatoes will generate profit: investors like Alibaba founder Jack Ma are ploughing in time and money for uncertain returns.