As the Chinese e-commerce giant launches its IPO, investors must decide what the shares are worth. Growth, profitability and stock market multiples are a factor. So are potential new businesses, though shaky governance merits a discount. Breakingviews spells out the key numbers.
Plans to cut cash salaries for state sector bosses by up to half may sting. But top executives in effect get another currency – political stock. If China’s ruling party had a share price, it would be rising. The trouble is, outsiders can’t easily see what that stock is worth.
International tension has helped stabilise the gold price after a 2013 plunge. But the fundamentals are bad. ETF redemptions persist while bar and coin investment has dropped heavily. Jewellery demand remains soft. Consumers want cheaper gold. They are likely to get it next year.
Chipping away at giants like Baidu and Alibaba means finding a niche. The rapid growth of JD, VIPShop, Qihoo, and YY shows there’s room for new models, and foreign investors are happy to fund them. But the line between healthy competition and profit-eroding rivalry is thin.
The new Indian leader has bagged a fat five-year investment commitment from his Japanese counterpart. India will buy foreign-made equipment in return for creating local jobs. Japan’s promise will embolden Narendra Modi to look for similar deals with China and others.
Citizens in the former colony have two options: choose between Beijing-approved chief executive candidates, or don’t vote at all. The new ruling leaves little room for compromise and risks a showdown with protesters. China’s leaders seem to care ever less what the world thinks.
Criticism is mounting against the $1-a-day threshold, a legacy of industrial-age thinking that equated penury with calorie deficiency. That’s too narrow. Being unable to afford education, medication or old-age security counts as deprivation. So does exclusion from modern jobs.