Asia-Pacific

Virus will finally force politicians to spend

27 February 2020

Central bankers don’t have the tools to combat the economic damage. Rather than relying on them again, governments will have to raid their coffers to safeguard public health and prop up growth. That will do short-term good, but could further distract from long-standing problems.

Breakdown: Coronavirus goes global

27 February 2020

China’s draconian efforts have slowed the new disease, but it’s now spreading worldwide. Competent and open government is the best defense against hospitals and society being overwhelmed. Nations may have to deal with recurring outbreaks. Breakingviews explains what to expect.

StanChart leaves investors secure in their gloom

27 February 2020

Boss Bill Winters scrapped a year-old target of lifting return on tangible equity to 10% by 2021, citing low rates and the coronavirus. A $500 mln buyback helps, but there is little sense of when profitability might reach the cost of capital. That cements a cut-price valuation.

Viewsroom: Hong Kong in the time of Covid-19

27 February 2020

Small businesses are hurting, while bankers sit idle and families struggle with school closures and other containment efforts. Despite having only some 80 coronavirus cases, life – as well as retail, tourism and real estate – feels noticeably different in the Asian financial hub.

Budweiser gets a bitter taste of breakups

27 February 2020

Covid-19 may cost AB InBev’s Asia spinoff $170 mln in EBITDA from China for January and February. That’s some $3 bln of implied enterprise value, before factoring in the rest of the year or the region. There’s a price to pay for sprawl, but a narrower focus brings its own risks.

Companies will be first line of U.S. virus defense

26 February 2020

The White House is downplaying the spread of the coronavirus, perhaps to calm markets. If there’s an outbreak, it may be up to CEOs to make calls that would hurt the economy, like closing factories. It would follow the trend of firms stepping up where government has left a void.

Apple scores another unwanted first on China

26 February 2020

After sounding the alarm earlier than peers on the impact of coronavirus on manufacturing, the $1.3 trln iPhone maker just got a clear warning from shareholders on human rights. CEO Tim Cook has kept divergent stakeholders onside pretty successfully, but that’s becoming harder.

Rio Tinto’s green pivot suffers by new comparisons

26 February 2020

The miner wants carbon emissions to be net zero by 2050. That’s good, but unlike BP’s recent goal it doesn’t include CO2 produced by customers. A post-virus stimulus from Beijing will be a boon to the China-dependent Rio, but could strengthen the case for greener credentials.

Hong Kong applies Band-Aids to virus-related ills

26 February 2020

The city rolled out a $15 bln support package as it lurches into recession. Employers get more than workers, but there are handouts for all. It’s a move in the right direction for a notoriously tight-fisted government. It may soon need stronger financial medicine, however.

Nio’s $1.4 bln lifeline may pave a smoother road

26 February 2020

The cash-strapped U.S.-listed Chinese electric-car maker is close to securing funding from a municipal government in Anhui. Similar past agreements have failed to materialise but this one, with official ties, is a more promising immediate and longer-term pillar of support.

South Korea could spend more on picking itself up

26 February 2020

The central bank is expected to cut rates 25 bps to 1%, a record low, but that will have muted impact if consumers stay at home on virus fears and more. Low government debt gives President Moon Jae-in space to deliver a bold spending plan including tax breaks and income support.

Super-app M&A would be sign of more rational times

25 February 2020

A mooted merger of Gojek and Grab could create a $23 bln Southeast Asian food-delivery-to-ride-hailing giant. Strategic investors are still keen to write cheques, but easy money from SoftBank and others is drying up fast. Consolidation is the best path to continued rapid growth.

Unizo check-in borders on being inhospitable

25 February 2020

Bids for the Japanese hotelier have reached $1.9 bln, and could go even higher. The company is already loaded with debt, meaning that any buyout will require some serious housekeeping to generate a solid return. Blackstone, Lone Star or Fortress may be sweating their equity.

Virus aid one-upmanship spreads across China tech

24 February 2020

Meituan Dianping is subsidising takeout while smartphone-maker Xiaomi may diversify into medical equipment to help fight the outbreak. Such moves are laudable, given China’s poor track record in philanthropy. The financial impact on companies, though, looks less certain.

Chinese consumers imperil V-shaped virus rebound

24 February 2020

The slowdown in new Covid-19 cases outside Hubei has fed investor optimism. Local stock prices are trading at pre-outbreak levels, helped by stimulus efforts. But even if the epidemic has peaked, which is far from certain, stress in the private sector hints at a slower recovery.

India-born CEOs take one step back, two forward

21 February 2020

The governance mess at Gulf hospital operator NMC has put an Indian executive on the map for the wrong reason. But the country’s huge business diaspora is taking charge of giant firms like IBM. The international influence highlights a dearth of local opportunity.

Review: Hong Kong activist waves red flag on China

21 February 2020

Joshua Wong was imprisoned last year for organising protests in 2014. In "Unfree Speech", he blames inept political leaders for the latest violence. He also makes a convincing case that China's tightening grip on the financial hub is part of a broader threat to global democracy.

Speedway could leave 7-Eleven with overfull tank

20 February 2020

The convenience store chain’s Japanese owner Seven & i may buy Marathon’s gas station business for $22 bln. If it does so with cash, then the acquisition would load it up with debt for what looks like a measly return. That might be why investors sent the shares down 9%.

Thai IPO tests waning market enthusiasm

20 February 2020

Central Retail shares opened flat on their debut. Cornerstone investors helped it price near the top of its range, although the economic timing couldn’t be worse. Thailand’s listing market has stayed hot even as post-IPO performance has cooled. One of these trends can’t last.

HNA journey lurches to fitting return home

20 February 2020

The Chinese conglomerate was already cash-strapped before the coronavirus hammered travel. Selling assets has been a struggle, leaving $80 bln of debt piled up. A government bailout in the making should imprint a strong reminder about the risks of costly overseas adventures.